This second-ever procurement period coincides with fresh speculation that Florida could expand its Medicaid rolls, which already support more than 4 million people. There is also debate over the efficacy of the $1.5 billion Low Income Pool funded by the Trump administration as an alternative safeguard for uncompensated care costs on safety-net providers.
Florida has been on the watchlist of states that may expand Medicaid if a Democrat or amenable Republican wins the gubernatorial race. Republican Gov. Rick Scott rejected Medicaid expansion in 2015 after it was approved by the state Senate and opposed by the state House.
Jeff Myers, president of the trade group Medicaid Health Plans of America, said he sees the odds for expansion improving with Florida's push to move more of the high-cost patients to managed care through this latest bid process.
Advocates say expansion could save the state money. A January report from the Florida Policy Institute projected the state would net about $500 million if it expands Medicaid because it would score federal dollars via an enhanced match. Florida currently receives a 61% federal match for its traditional Medicaid population and could rake in a 90% match after expansion.
Medicaid insurance for people who now fall into the so-called "coverage gap" would cover mental health and substance use treatment, as well as uncompensated care costs, that currently come out of the state's general revenue funds, the study said. Florida also would get additional revenue from new provider taxes.
Proponents of expansion are also pointing to what they see as the inadequacy of Florida's Low Income Pool. This pool was viewed as an alternative to expansion to shoulder some of the uncompensated care costs loaded onto safety net providers. The state faced off with the Obama administration over the issue when officials argued the pool was extraneous when the state had the option to expand. Under Obama, the CMS started to wind down the federal funding and last year gave the state just $600 million.
A Kaiser Family Foundation analysis reported that Florida could have received as much as $51 billion from the federal government over 10 years if it had expanded Medicaid instead.
The Trump administration renewed the state's 1115 Medicaid waiver to extend its managed-care effort, along with the low-income pool. As part of this renewal, CMS Administrator Seema Verma approved $1.5 billion annually for the term of the five-year waiver.
Not all the funding has made it to the state, according to Anne Swerlick of the Florida Policy Institute. Providers haven't been able to draw down even half of the federal money because local entities, rather than the state, have to cough up the matching funds through hospital taxes.
Following a 30-day comment period, the state's health department will apply to the CMS for an amendment to its managed-care waiver so officials can break with the federal requirements of a 90-day retroactive enrollment grace period for Medicaid enrollees.
State lawmakers have approved a measure to allow for the waiver application for the change, which officials want to implement by July 1, and the health department is projecting state savings of $98 million annually and likely cutting about 39,000 from the rolls.
Patient advocates say the policy would hurt the most vulnerable patients, even though it exempts pregnant women and children.
"The Florida program is so lean; what we're talking about is people with disabilities and seniors," Swirlick said. "They are the most affected by this."
The Florida Policy Institute also noted that safety-net hospitals and other providers would likely see a spike in uncompensated costs, which now total about $2.4 billion annually.
In its comment letter on the proposed waiver amendment, the Florida Policy Institute cited an estimate from the Florida Chamber of Commerce that "insured Floridians are already paying about an extra $2,000 for every hospital stay to cover the cost of the uninsured."
Molina Healthcare failed to win a Florida Medicaid contract in this procurement. The company served about 360,000 Medicaid members in eight of 11 regions throughout Florida and was only selected to negotiate for a new managed-care contract effective in 2019 in one region where it currently serves 59,000 members.
