By
Anne Swerlick
|
March 8, 2018

Medicaid Hospital Reimbursement Drives the Legislature into Overtime

Medicaid Hospital Reimbursement Drives the Legislature into Overtime

Session will not be ending on time. The chambers have purportedly reached a budget agreement, meaning that what was being reported as the final stumbling block, Medicaid hospital reimbursement, has been resolved. Unfortunately, this resolution comes too late to pass a budget and complete the session by March 9.

The Florida House and Senate took very different approaches to the hospital reimbursement issue; however, the House version has prevailed and will become part of the final budget.

The Florida House proposal would continue the current model, providing $318 million in enhanced Medicaid payments to 28 hospitals that serve large numbers of Medicaid patients. The Senate proposed to eliminate these targeted enhanced payments and instead fold the dollars into base rates that flow to all hospitals serving Medicaid patients.

Hospitals are not on the same page with these proposals. Under the Senate model, public, teaching and children’s hospitals comprising the Safety Net Hospital Alliance would have millions to lose. Miami’s Jackson Health System alone would take a $59 million cut. In contrast, for-profit chains, like Hospital Corporation of America (HCA) and Tenet are slated to gain $44 million.

Rural hospitals endorsed the Senate proposal. It included an extra $50 million over current year funding, which could have helped make up for the more than $11 million cut these hospitals are absorbing this fiscal year.

One point of agreement is that Florida Medicaid reimbursement rates are too low. The 2015 Navigant study noted, “Florida’s Medicaid program is not funded to the level that programs of similar size across the nation are funded, resulting in below average payments to providers throughout the state.”

Nothing has happened to change this fact. Indeed, since that study, funding has only decreased, with hospitals taking a $521 million cut just last session.

Yet, the Legislature continues to resist a proven way to fundamentally change this picture: Medicaid expansion. Expansion has been shown to improve hospital finances and reduce closures, particularly in rural areas and those with large numbers of uninsured adults.

In the meantime, the 2018 Legislature will no doubt come up with another short-term band aid and keep kicking the can down the road. Surely, the extra taxpayer dollars spent on legislative overtime to fix this problem could be better invested in long term solutions to truly improve access to health care for all Floridians.

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