Northeast Florida’s largest public hospital and academic medical center sent Gov. Rick Scott a letter this week responding to his series of questions about the facility’s financial woes and why it has the dubious distinction of being most reliant on supplemental Medicaid dollars.
University of Health Florida Jacksonville Chief Executive Officer Russell E. Armistead’s letter (below) includes a confidential review by a national accounting firm prepared for the Jacksonville Civic Council that shows the hospital is “one of the most cost effective academic medical centers in the United States.”
The letter responds to the governor’s financial inquiries but it starts by advising Scott of one of the hospital’s guiding principles: “To treat all patients with dignity and respect, regardless of their ability to pay. Given that roughly 18 percent of all Jacksonville residents have no health insurance, we provide large amounts of charity care as part of our commitment to social responsibility.”
Scott sent Armistead a letter one week ago asking him to explain why the hospital was “extraordinarily reliant on federal (Medicaid) funds and what can be done to improve its financial viability.”
The governor asked Armistead to provide the answers so they can be considered by his newly created Commission on Healthcare and Hospital Financing. Scott created the nine member panel after a dysfunctional legislative session where the House of Representatives adjourned 72 hours early and without consulting the Florida Senate.
Armistead told Scott there are efforts being made to diversify the hospital’s payer mix and attract more commercial dollars, thereby lessening its reliance on Medicaid. That’s being accomplished through an off-campus expansion on the north side of Jacksonville, Armistead explained. The first phase of construction included an emergency department and 80,000 square feet of physician offices space. The second phase–and vital to the efforts to attract more commercially insured patients–is the construction and completion of inpatient hospital beds. The hospital already has the approval from the state to build the beds but hasn’t been able to do so because of finances.
LIP, Armistead said, or a similar alternative “is critical for our ability to finance the inpatient beds that will ultimately lead to an improved payer mix and less reliance on governmental funding.”
The federal government advised Florida this week that the state could tentatively expect the Low Income Pool to provide $1 billion in supplemental Medicaid payments to the state in fiscal year 2015-16 and another $600,000 in 2016-17. The $1 billion figure is less than half of what the state currently gets and brings the supplemental Medicaid program back to its original funding levels. The $600 million figure covers about 25 percent of overall uncompensated care costs in Florida.