Rick Scott builds health care budget with $2 billion in money that may not be there

Florida Gov. Rick Scott released his $77 billion proposed budget for fiscal year 2015-16 on Wednesday that is built in part on the assumption that Florida will receive $2 billion in federal health care dollars to help treat the poor and underinsured, mostly at Florida hospitals.

Addressing a group of reporters at The Associated Press legislative planning session Scott said “we are hoping we can continue working with the federal government with regard to that.”

In all the health and human services portion of Scott’s budget totals nearly $32 billion.

Florida was put on notice one year ago that the “Low Income Pool” would expire June 30, 2015. Commonly called LIP, the money is mostly a combination of local dollars–called intergovernmental transfers– and federal matching dollars.

House and Senate legislative leaders said it was too early to comment on how their budgets would be developed and whether they would include the money in their proposed spending plans for the upcoming fiscal year.

House Minority Leader Mark Pafford said LIP was important and that building the budget with the dollars that haven’t been committed could result in a budgetary hole.

Hospital lobbyist Jan Gorrie said the industry is thrilled the governor included the $2 billion in his budget recommendations and that there’s optimism “something can be worked out with the feds before the end of the state budget process.”

LIP is made possible by a sweeping Medicaid waiver that allows the state to operate a mandatory Medicaid managed care program. That waiver expires June 30, 2017.

Gorrie said the hope is to get the full $2 billion–or more–through 2017 “and game plan as to how we transform things for the next waiver period.”

Medicaid Deputy Secretary Justin Senior and Assistant Deputy Secretary for Medicaid Finance, Stacey Lampkin, spoke with CMS last week for about 20 minutes and is scheduled to talk again next week, said agency spokesperson Shelisha Coleman.

The federal government last year required the state to contract with an independent third party to analyze the LIP program and recommend reforms so the state could move away from an “over reliance on supplemental payments” and toward a managed care or fee for service system, instead.

That analysis was prepared and submitted to the state and federal government January 15.

The governor’s budget does not contain any proposal for Medicaid expansion as allowed under the federal health care law commonly called Obamacare.

When asked about Medicaid expansion Scott avoided directly answering the question. “I continue to feel good about what we accomplished in 2011 where we did historic Medicaid reform. We now have a plan our state taxpayers can afford and we have Medicaid recipients getting care.”

When asked a follow up questions about Medicaid expansion, the governor replied “I am going to focus on jobs and education.”

Some details of the health care budget include:

$30.2 million statewide decrease in aggregate Medicaid payments for prepaid health plans
eliminating 81 jobs from the Agency for Health Care Administration
eliminating 758 jobs from the Department of Health
eliminating 38 jobs from the Department of Children and Families
$1 million for a study to consider a prospective payment for hospital outpatient services as well as nursing home services. Currently these services are paid for on a cost basis. “This new patient centered initiative will further reward the delivery of high-value, quality-driven health care services in an efficient manner, to the benefit of both Medicaid recipients and Florida taxpayers,” Scott said in a press release