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Senate Approves Healthcare Funding For More Low Income Residents

World Bank Photo Collection/flickr

We’re midway through the Legislative session in Tallahassee. The only thing lawmakers are required to do is craft a budget for the fiscal year, which begins July 1. But the House and Senate have some big differences in their proposed budgets. The biggest difference is a $5-billion gap regarding healthcare costs.

The Senate has a plan to continue receiving federal money to pay for healthcare for low-income people.

The proposal involves restructuring what’s called the Low Income Pool, also known as LIP. The idea is to distribute federal money more broadly, benefiting more hospitals that treat a high number of poor and uninsured patients.

Florida will lose more than $2 billion in funding starting in July if the federal government doesn’t accept the new plan.

Senate budget chief Tom Lee told senators they’ve been dealt a difficult hand.

“We have a substantial healthcare funding problem in the form of a stalemate on this Low Income Pool that is so important to help our safety net hospitals and hospitals ... in our state deal with the unreimbursed care.”

House leaders say they want the LIP program to continue, but Lee noted they haven’t included the funds in their budget proposal.

“We do have an obligation to recognize that funding gap, the ... hundreds of millions of dollars that our safety net hospitals will lose back in our communities. We cannot ignore that.” 

South Florida is especially vulnerable to the loss. Sen. Rene Garcia, R-Hialeah, just got back from a trip to Washington for a meeting with federal health officials.

“When some folks say ‘well, what’s the big deal with LIP? What’s the big deal? These are federal dollars that are flowing through.’  To two counties in this state – our friends in Broward and our friends in Miami-Dade County, this could cost us collectively $500 million if we don’t get this LIP model approved.”

The Senate also wants to use nearly $3 billion in federal money available under the Affordable Care Act for an alternative to Medicaid expansion.  The funds would be used to create the state-run Florida Health Insurance Affordability Exchange. It would offer private market insurance at a low cost for those who meet certain work and educational requirements. 

Garcia says nearly a million low income residents who don’t qualify for Medicaid would be insured.

“That fix revolves around making sure that individuals under 133 percent of the poverty line have access to affordable health insurance through our model.”

The LIP renewal may hinge on whether Florida enacts some sort of Medicaid expansion. But House leaders say they won’t consider any plan that might put more people into what they say is a broken Medicaid system.

If lawmakers don’t agree on a solution for both LIP and for Medicaid, Garcia says they have three choices: cut local services, close some hospitals, or increase taxes.

Sen. Garrett Richter, R-Naples, also made the trip to Washington to meet with health officials. He says the funding problem isn’t going to solve itself if the government allows the program to expire.

“My takeaway on that meeting was that we still have a serious issue to resolve, that our federal partners are going to keep an open mind. They understand that the Senate is pursuing a responsible solution.”

Senate President Andy Gardiner requested the meetings in Washington. He says Florida’s healthcare crisis is the driving force behind the Legislature’s budget decisions.

“Nobody can ever say the Senate didn’t offer up solutions. Nobody can ever say we weren’t prepared to go to the table and negotiate a modified LIP model or negotiate a free market approach to Medicaid expansion. If we’re going to make decisions on taxes, education spending, it’s important that we address the $2.2 billion hole in our budget.”

The Senate unanimously approved its budget proposal Wednesday. A few hours later - in a surprise move - lawmakers learned that the federal government has suspended negotiations with Florida health officials for at least two weeks.

That makes it less likely that the Legislature will finish its budget work on time. The session ends May 1st.