'Transformational' Medicaid overhaul set for passage

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With a sponsor calling it the ?ost significant transformational change?since Florida? Medicaid program started, lawmakers will vote Friday on a long-awaited proposal to shift almost all beneficiaries into managed-care plans, reports Jim Saunders of the News Service of Florida.

Senate leaders on Thursday unveiled the proposal — which covers 215 pages over two bills — after days of behind-the-scenes negotiations with the House.

Sen. Joe Negron, a Stuart Republican who is the chief sponsor, said the proposal would help limit the Medicaid program? costs, while also improving care for beneficiaries.

? don? see Medicaid as a government program,? Negron said during a lengthy discussion on the Senate floor. ?o me, Medicaid is about the people who are receiving the benefits.?

The Senate and House are expected to approve the proposal Friday, the final day of the 60-day legislative session. But it still would need federal approval and, even in the best case, would not start taking effect until next year.

The proposal also includes numerous controversial pieces, such as limiting the liability of doctors and hospitals when they treat Medicaid patients. Except in egregious circumstances, pain-and-suffering damages would be limited to $300,000 in malpractice cases brought by Medicaid beneficiaries.

Sen. Arthenia Joyner, D-Tampa, criticized the limit, which she said unfairly targets the low-income people who qualify for Medicaid.

?hy is it that their pain and suffering is devalued?? Joyner asked.

But Negron described the limits as a ?rade-off?for doctors and hospitals that carry out the Medicaid program for the state. Also, many medical providers complain they do not get paid adequately to care for Medicaid beneficiaries.

The bills (HB 7107 and HB 7109) emerged as a compromise after the House and Senate put together different plans for overhauling the $20 billion Medicaid system. Republican leaders made such an overhaul a top priority, as Medicaid costs have soared in recent years.

Under the proposal, beneficiaries will eventually be required to enroll in HMOs or provider-service networks, another type of managed care. The requirement will affect seniors who need long-term care and a broader group of beneficiaries such as women and children — but not people with developmental disabilities, according to Negron.

Michael Garner, president of the Florida Association of Health Plans, said his HMO-industry group was reviewing details of the proposal Thursday. But like Negron, he said the Legislature? overall approach would improve access to care and help hold down costs.

?he bigger point is that you have a program with a horrific (financial) problem on its shoulders, and you have to fix it,? Garner said.

The proposal calls for carving the state into 11 regions, with HMOs and provider-service networks competing for contracts in each area. The proposal includes an October 2013 target for fully implementing the long-term care portion and an October 2014 target for the broader Medicaid population.

In what likely will be a controversial move, House and Senate negotiators decided against including what is known as a ?edical loss ratio? in the proposal. Such ratios require HMOs to spend certain percentages of the money they receive on patient care.

Federal officials sent a letter to Florida last week indicating they wanted a medical-loss ratio to be used. But legislative leaders instead took a different approach, proposing that HMOs share with the state any profits above 5 percent.

The insurance industry generally does not like medical-loss ratios, at least in part because of questions about which expenses should be counted as patient care. But longtime social-services lobbyist Karen Woodall said the legislative proposal needs a medical-loss ratio, and she is concerned health plans will squeeze benefits as a way to boost profit.

?here do you get that from?? Woodall asked. ?ou get that from limiting benefits.?

Dozens of health-care lobbyists have closely watched the Medicaid issue throughout the legislative session, and the compromise proposal will affect various parts of the industry.

For example, nursing homes were concerned that a shift to managed care would lead them to lose a portion of the money they receive to care for Medicaid beneficiaries. The proposal, however, helps ease that concern because it would require managed-care plans to pass through the amount of Medicaid payments that nursing homes otherwise would receive from the state.

Nursing homes, however, unsuccessfully lobbied to get liability protections included in the bill. With doctors and hospitals getting such protections, industry lobbyist Bob Asztalos said he fears nursing homes will become a ?igger target?for personal-injury attorneys filing lawsuits.

Hospitals, meanwhile, want to help create provider-service networks that would compete with HMOs. Several details in the bill could affect the ability of the networks to form and be financially viable.

But Tony Carvalho, president of the Safety Net Hospital Alliance of Florida, said the proposal is only a first step toward revamping the Medicaid system. Along with needing federal approval, the proposal could undergo changes when lawmakers meet next year.

?his bill is not the end of reform and the whole decision-making process,? Carvalho said.

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.