Florida is scheduled to lose $1 billion in federal health funds at the end of June, a hole in the state budget the Legislature must fill in its upcoming session if a settlement isn't reached between the administrations of Gov. Rick Scott and President Barack Obama.
The state has known for about a year about the impending cut in funding to cover uninsured, low-income hospital patients, but Scott has included the money in his proposed 2015-16 budget, which takes effect July 1. The hospitals are using the issue to bolster arguments to expand Medicaid during the 60-day Legislative session that begins Tuesday.
The fight is largely over the state's refusal to expand its Medicaid program to cover about 1 million uninsured Floridians under the Affordable Care Act. Republican House Speaker Steve Crisafulli and other leaders have refused to consider the expansion, which the federal government would fully fund through 2016 and pay roughly 90% after that. They say they don't want to expand an already broken system and also worry the federal government won't follow through on its payment promise, leaving the state to foot the bill.
As a possible compromise, a coalition of business leaders, health advocates, hospitals and some Republicans are supporting a plan that would accept Medicaid money and give it to consumers so they could purchase private insurance. Called "A Healthy Florida Works," the plan would also require consumers to pay monthly premiums to encourage accountability.
Hospitals say they need both the federal funds and Medicaid expansion because Medicaid covers less than half the cost of providing the care.
"It is not a one or the other situation," said Tony Carvalho, president of the Safety Net Hospital Alliance of Florida, a coalition of 14 hospitals that treat the needy.
Scott, a Republican who entered politics opposing the healthcare law, is also unlikely to lend support, saying only that he won't stand in the way if the Legislature passes Medicaid expansion.
Senate leaders say they are open to a dialogue on Medicaid and Sen. Aaron Bean's committee will look at the "A Healthy Florida Works" plan during the first week of the session.
"The Senate has certainly shown a willingness to look for free-market options on this," said Senate President Andy Gardiner, R-Orlando, but noted there's been no discussion with the House. "It might just be a workshop discussion or it could turn into a committee bill."
Medicaid expansion supporters thought the loss of the low-income funds could provide the catalyst needed to convince Republican lawmakers to expand Medicaid rather than dipping into the stage budget.
State health officials said they met with federal officials last week and are continuing conversations, but offered no other details, and it's unclear whether the state has a contingency plan. But recently, there's been growing speculation that the funds may continue in another form, making it tricky for lawmakers to budget.
Scott spokeswoman Jackie Schutz said the administration would be "extremely disappointed" if no deal is reached with the Obama administration on funding.
"Florida taxpayers fund our federal government and deserve to see a return on their investment - and we want to see it continue to provide health care for those who need it," she said.
The CMS said it would not extend the fund "in its current form beyond June," but said in a statement it will work with the state on alternatives.
Yet the state Agency for Health Care Administration, which oversees Medicaid and the hospital grant, remains optimistic. Spokeswoman Shelisha Coleman said in an email that "the federal government will surely not stop funding."