Federal decision helps bolster state coffers

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Each month the extension is in effect frees up about $130 million in state money.

Florida lawmakers have gotten a well-timed budget break thanks to a decision by the federal government to extend the nation’s public-health emergency due to the COVID-19 pandemic.

U.S. Health and Human Services Secretary Alex Azar extended the public-health emergency last week.

Azar’s decision means the federal government will continue to allocate a 6.2 percentage-point increase in money for Medicaid, the joint federal-state health care program. Before the extension, the additional funding was slated to expire in March.

Justin Senior, chief executive officer of the Safety Net Hospital Alliance of Florida, estimated that each month the extension is in effect frees up about $130 million in state money that would otherwise be needed to fund Medicaid. Senior’s association represents 14 of the state’s public, teaching and children’s hospitals.

“That’s a huge boost to the budget, both this year and potentially next year, that can help lawmakers avoid cutting health care in the middle of a pandemic,” said Senior, a former secretary of the state Agency for Health Care Administration, which runs much of the Medicaid program.

The good budget news came as lawmakers return to Tallahassee this week for the first round of committee meetings before the March 2 start of the 2021 Legislative Session. With the pandemic reducing state tax revenues, finding a way to balance the budget will be a major issue during the Session.

Recognizing the national economic problems caused by the pandemic, Congress initially agreed in March to boost the federal Medicaid match for all states by 6.2 percentage points.

The decision by Azar to extend the emergency means that Florida should continue to receive the increased federal funding through the June 30 end of the state’s 2020-2021 fiscal year.

Medicaid provides health coverage to poor, elderly and disabled people. Enrollment in the program is countercyclical, increasing in tough economic times when there is reduced state tax revenue to help pay for it. When the economy is thriving and money to fund the program is available, enrollment decreases.

Before the COVID-19 pandemic, enrollment in Florida’s Medicaid program had usually been below 3.9 million people. As of Nov. 30, 4.475 million Floridians were enrolled in the program, a nearly 19% increase from the 3.76 million who were enrolled in March 2020, prior to the economic shutdown associated with the pandemic.

While enrollment in Medicaid programs is increasing nationwide, Florida, which did not expand Medicaid eligibility under the federal Affordable Care Act, has seen some of the largest increases, according to Tom Wallace, the state Agency for Health Care Administration’s assistant deputy secretary for Medicaid finance analytics.

The Medicaid program does not cover all low-income Floridians and has different eligibility criteria based on age, income and assets and medical conditions. But increases have been seen in nearly every eligibility category, from children to poor seniors, according to Amy Baker, coordinator of the Legislature’s Office of Economic & Demographic Research.

While the federal extension means additional funds for the state, it also means additional restrictions. During the pandemic, state Medicaid officials cannot alter the program to make enrollment more restrictive than what it was prior to January 2020.

Additionally, so long as the public health emergency continues, the state is largely precluded from disenrolling anyone who was enrolled in Medicaid on March 18 or who enrolled due to the pandemic, with some limited exceptions. For instance, states can disenroll people who have been incarcerated or people who were presumed to be eligible for Medicaid but were ultimately determined ineligible.


Republished with permission from the News Service of Florida

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