For weeks the administration of Florida Gov. Rick Scott has downplayed the expected loss of more than $1 billion in federal funds that goes to hospitals that treat the poor and uninsured.
But that changed on Friday as it is becoming more evident that the state must come up with an alternative solution in order to avoid making deep spending cuts in this year’s budget.
Scott’s main spokeswoman, Jackie Schutz, acknowledged that the federal government would not renew the low-income pool program that was first started under a waiver obtained by former Gov. Jeb Bush.
“It is disappointing that the federal government is not extending the federal LIP program which was started by the federal government in 2005 to help low income people in Florida access health care,” Schutz said. “We would be extremely disappointed if the federal government did not agree to an alternative funding solution soon.”
Schutz continued by saving that “we cannot afford to fund federal programs that are started by the federal government. Florida taxpayers fund our federal government and deserve to see a return on their investment – and we want to see it continue to provide healthcare for those who need it.”
The move is a turnaround from earlier in February when Scott’s budget director Cynthia Kelly tried to explained to legislators why Scott had included the LIP money in his budget recommendations. The federal government last year extend LIP but warned at the time it had no plans to extend the program – which allows the state to use local taxes and state money – to draw down extra money for the state’s hospitals.
The acknowledgement by the Scott administration that there is now a problem with LIP sets up what may be a contentious session. Florida expects to have a roughly $1 billion budget surplus, but Scott had wanted to use that money to increase school funding and cut taxes. Scott has proposed slashing taxes by nearly $700 million.
Some Republican legislators have already been sounding increasing skeptical about whether they would be able to cut taxes to the extent that Scott wants.
The demise of LIP could create additional pressure to expand Medicaid eligibility but so far House Republicans have remained staunchly opposed to the idea.