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House, Senate, and feds stick to their guns on Medicaid dollars as session slips away

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What started out smoothly a few months ago now appears to be falling apart as leading Republicans in the House and Senate began finger-pointing over a healthcare dispute that appears likely to derail the 2015 session.

The latest evidence that the May 1 session would not end on time came after the Department of Health and Human Services sent a letter to Medicaid Deputy Director Justin Senior outlining where the federal government stands on Low Income Pool negotiations with the state.

Senior told Florida Politics last month that he hoped to have a broad agreement with the Centers for Medicare and Medicaid Services where the federal government would advise Florida how much money it could expect to receive in Low Income Pool and the details surrounding the program could be worked out later.

But the April 14 letter explained why Medicaid expansion was better than an uncompensated care pool such as LIP and provided the state guidance on how much it could expect to get in supplemental Medicaid funds.

The letter triggered responses from House Speaker Steve Crisafulli and Senate President Andy Gardiner that made it clear the two chambers were unlikely to reach accord on the thorny issue of Medicaid funding and healthcare expansion any time soon.

Gardiner sent a lengthy message to senators, and the press, detailing how Florida got to this point. In the memo, Gardiner stresses that the federal government put the state on notice more than one year ago that Low Income Pool dollars would expire. Gardiner’s memo also tells senators that all discussions about the costs of uncompensated care between the state and CMS have excluded the costs of the people who would be eligible for a Medicaid expansion under the federal healthcare law.

Gardiner also told senators in his memo that while AHCA maintains its uncompensated care still would hover at $2.16 billion even with Medicaid expansion the federal government has questioned those figures.

Gardiner’s memo then lists a parade of horribles that would occur if LIP were to be phased out and no additional state funding used to supplement the loss. Hospitals, he said, would see an average 15 percent reduction in rates statewide and would lose $1.3 billion in funding.

“We should expect layoffs and less services. The programs most at risk are those with high costs and low margins. Cancer centers, dialysis units, transplant services, graduate medical education capacity, and other special services will be limited or may even close their doors as hospitals struggle to cover the high emergency room costs of uninsured Floridians who could qualify for expanded coverage.”

Gardiner notes that the cuts also would impact Medicaid HMOs, which would see a reduction in their rates and therefore could jeopardize the arrangements the HMOs have with healthcare providers.

“The bottom line is: more than ever, today’s correspondence from CMS highlights the link between LIP and expansion and the need to consider a comprehensive Florida solution,” he wrote.

Gardiner’s letter reiterated to his members why the Senate push to expand Medicaid through SB 7044 and include supplemental funding in its budget.

Likewise, Crisafuli’s statement has been consistent with what he has told reporters all session.

“The letter from CMS contains, at best, mixed messages about the federal government’s intentions on LIP funding. It is unthinkable that they would leave our state on the hook for over a billion dollars simply because they want a specific policy outcome.

“We believe the Florida Senate has provided inaccurate and false hope to Washington, D.C., and has muddled negotiations,” Crisafulli said, referring to the Senate passing a Medicaid expansion bill. “Let me be clear — the discussions about LIP and Medicaid expansion must be separate. The fact is, Medicaid expansion will not cover all of the Floridians that need LIP funds.

“We have long warned Floridians that the federal government is capable of holding states hostage based on untenable strings attached to federal funding. Nothing should give our state more pause than what has occurred today.

“We call upon those who truly care about creating a safety net for the neediest Floridians to join us in asking the federal government to fulfill their commitment to Florida by providing continued LIP funding in a new form.”

Gardiner and Crisafulli aren’t the only players who haven’t changed their message. The letter that CMS sent on Tuesday also is consistent with the message that the federal government has delivered for the past year, said Florida Hospital Association President and Chief Executive Officer Bruce Rueben.

“This is really just a reiteration of what they’ve been saying since last April,” Rueben said, adding that he went to Baltimore last April when Florida was able to secure LIP funding for the current fiscal year. “They told us that day they’d extend it one more time and never again.”

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