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Why are Safety Net Hospitals crying foul over $134 million in new funding?

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It’s hard to criticize Florida’s safety net hospitals. They are the last-resort centers that provide medical care to uninsured or under-insured people. Who could argue against doing everything possible for such a deserving cause, right?

But with those hospitals screaming about a proposed state funding formula, maybe we should all take a moment to catch our breath and look at the bigger picture.

What we’ll see is that all Florida hospitals – even the for-profit institutions so easy to demonize in this kind of discussion – will be feeling some pain from the federal government’s decision to trim Low Income Pool funding by $400 million. But we’ll also see that all Florida hospitals, including the squawking safety net ones, will still have the resources required to care for everyone who needs it.

Funding for uncompensated health care is parceled out through convoluted formulas, and an important part of the equation is Low Income Pool, or LIP, funding. These federal funds are supposed to offset the cost of uncompensated care, and both nonprofit and for-profit hospitals receive a portion of the funds.

Florida and the feds have been in squabbling over LIP funding for several years, and now the state is having to find a way to divvy up a shrinking pool of money amid ever-increasing health care costs.

Early this week, legislators proposed a formula for using the reduced LIP and other funding sources. Under this formula, the affected hospitals would be just fine. But now some of the safety net hospitals are pushing for change, even though everyone already knew hospitals would get less funding because of the feds’ decision to reduce LIP.

In fact, when you include the many factors incorporated into the Senate proposal, safety net hospitals stand to come out ahead of last year’s funding by more than $134 million – which is $30 million more than for-profit hospitals stand to gain under this plan.

Considering that Florida’s for-profit hospitals actually provide greater volumes of care to uninsured residents while also having the burden of paying taxes, the proposed formula actually provides a meaningful advantage to the state’s public hospitals… the ones who are clamoring for even more money.

This feels like the same old story when a legislative session heads into the home stretch. With just over a week left, lawmakers are being pressured to go back on decisions they already made and waste time that should be spent on other things.

Making an 11th-hour policy change that affects some $700 million in payments is extremely inappropriate, and is only being done this way because there’s no good policy argument for it – some interests just want to funnel money to certain hospitals.

Floridians have nothing to gain from this kind of political play. Legislators should recognize that they made a good decision on Monday about allocating LIP funding. Now they should move on to more important issues.

Peter Schorsch is the President of Extensive Enterprises and is the publisher of some of Florida’s most influential new media websites, including,,, and Sunburn, the morning read of what’s hot in Florida politics. SaintPetersBlog has for three years running been ranked by the Washington Post as the best state-based blog in Florida. In addition to his publishing efforts, Peter is a political consultant to several of the state’s largest governmental affairs and public relations firms. Peter lives in St. Petersburg with his wife, Michelle, and their daughter, Ella.

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