House, Senate HHS budgets avoid cuts

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With a brighter state budget picture, the House and Senate likely will spare hospitals and nursing homes from Medicaid rate cuts that have repeatedly posed threats in recent years, reports Jim Saunders of the News Service of Florida.

In releasing initial budget proposals Wednesday for the 2013-14 fiscal year, however, key players in both chambers said they plan to move forward July 1 with a new system of paying for inpatient hospital care. Some hospitals that treat large numbers of Medicaid-funded patients have argued that the system — known as diagnosis related groups, or DRGs — should be delayed.

Senate Health and Human Services Appropriations Chairwoman Denise Grimsley and House Health Care Appropriations Chairman Matt Hudson noted that hospitals already use such a payment system for Medicare patients.

“I don’t have any concerns,” Grimsley said. “They can do it.”

Both chambers, however, want to tweak the planned payment system to help target additional money to hospitals that serve large numbers of pediatric patients. Also, the House budget proposal would provide $104 million to help hospitals adjust to the DRG system.

“We put in additional funds to ease that transition, because it obviously is of concern to the hospitals,” Hudson said.

The House and Senate are expected to publish full budget proposals later this week, but the documents released Wednesday indicate the House would spend about $31.3 billion on health and human services, while the Senate would spend nearly $30.8 billion. Those figures include budgets for six state agencies, with by far the largest share of the money going to Medicaid expenses.

With the state facing repeated budget shortfalls in recent years, health and human-services programs have tried to fend off cuts. Hospitals and nursing homes have often been targets, largely because they are paid billions of dollars to care for Medicaid beneficiaries. That continued in January, when Gov. Rick Scott released a budget proposal that called for a 2 percent cut in hospital inpatient rates.

The House and Senate appear poised to go along with Scott on other issues, such as providing services to more people with developmental disabilities and reducing a longstanding waiting list. Scott has made the issue a priority, though the House and Senate ultimately will have to agree on how much to spend on reducing the list.

The 2013-14 budget also will include money to carry out parts of the federal Affordable Care Act, better known as Obamacare. Both proposals released Wednesday include $677.7 million — all federal money — that is required to be used to increase Medicaid reimbursements to primary-care physicians.

Also, the House budget includes about $20.4 million in anticipation that the Affordable Care Act will lead to more people enrolling in Medicaid. Those people are already eligible for the program but have not enrolled. Analysts have repeatedly said they expect such increased enrollment as the Affordable Care Act fully takes effect in 2014.

Peter Schorsch is the President of Extensive Enterprises and is the publisher of some of Florida’s most influential new media websites, including SaintPetersBlog.com, FloridaPolitics.com, ContextFlorida.com, 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.