Guest Author
Medicaid is at a critical juncture. As they work on a federal budget, lawmakers in Washington are considering massive and unfair cuts to the program that would have cataclysmal consequences for our state’s most vulnerable and destabilize the world-class health care system Florida has built.
Make no mistake about the nature of the cuts. They are not an accounting tactic. They are not a tax cut. Nor are they a means of making Medicaid more efficient or cost-effective.
They are an extreme blow to a system of care that is already underfunded and is relied on by about one in five Florida residents, primarily pregnant women, low-income children, individuals with disabilities, and frail and vulnerable elderly. In some of our rural communities, Medicaid covers a third or more of all residents.
Base Medicaid payments cover less than 60 cents of every $1 in costs for hospitals to provide care to Medicaid enrollees, leaving them with a shortfall every time care is provided to a pregnant mom, a child with special health care needs, or a low-income senior citizen with cancer.
Hospitals rely on supplemental payments to make up some of this shortfall. Florida, like nearly every other state, uses the flexibility afforded by the federal government to finance the state’s required share of these payments. One way is through provider taxes on hospitals themselves. These taxes are aggregated and combined with federal Medicaid funds, with the payments then directed to hospitals through Medicaid managed care organizations based on Medicaid utilization.
Congress is considering curtailing these widely used provider taxes and limiting the amount of directed payment that hospitals receive. The result: more unfunded care costs and tough decisions.
If hospitals have to take on even more unreimbursed costs, they must make heartrending choices about reducing or eliminating resource-intensive services, such as trauma, pediatrics, labor and delivery, psychiatry or burn care. They could reduce or eliminate community-based services, such as mental health clinics. With the diminished availability of those community services, Medicaid enrollees will be forced to rely more heavily on the most expensive entry point to the health care system, the emergency department, driving up federal spending and not reducing it.
In our smaller communities, hospitals might have to close entirely.
And, the results won’t be evident only on a financial statement.
The consequences of these draconian cuts will be seen in the lack of a staffed nursing home bed for a low-income senior who can no longer live independently. They will be seen in potentially life-threatening delays for a child needing chemotherapy. They will be seen in a 30, 40 or even 50-mile drive for a mom to get to a hospital where she can safely deliver her baby. They will be seen in the continued cycle of crisis and desperation for a young man with schizophrenia who alternates between jail and the hospital emergency department.
Florida already ranks nearly dead last regarding per capita Medicaid spending. As a non-expansion state, it also covers Medicaid eligibles only at levels required by the federal government, except for somewhat enhanced eligibility for children, pregnant women and new moms. Florida Medicaid has no fat to trim, no bloat to eliminate, no waste to minimize.
The cuts Congress is considering will do nothing more than starve and enfeeble an already-lean system of care that is a lifeline for so many Floridians. Lawmakers still have the chance to reverse course and pursue other policies.
Our children, our elderly and our most vulnerable are counting on it.
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Mary C. Mayhew is president and CEO of the Florida Hospital Association.
