By Marissa Evans, CQ Roll Call
May 13, 2015 -- Florida is about to lose federal support for its program to reimburse hospitals for caring for uninsured and indigent patients, and that worries road builders and educators.
That's because the loss of $1.3 billion for the state's so-called Low Income Pool, or LIP—which the administration of Republican Gov. Rick Scott has seen coming for almost a year—will blow a hole in the state budget and could mean less money for other state obligations, including transportation and education.
"When you just look at the amount of dollars related to LIP, some of it is going to have to be made up somewhere and there [are] just not that many options," said Bob Burleson, president of the Florida Transportation Builders Association. Even though the state legislature last year declined to expand Medicaid under the 2010 health care law, Florida officials were able to convince the federal agency that allocates Medicaid funds to the states to continue funding LIP for one more year.
That year is up on June 30, and the Scott administration is trying to convince the Centers for Medicare and Medicaid Services (CMS) to continue funding the program. CMS has another idea: Use the potential $51 billion in federal funds stemming from Medicaid expansion to help fill the LIP funding hole.
The Florida Senate has voted to do just that, while the more conservative House remains opposed. Both chambers are controlled by Republicans.
Scott's administration is negotiating with federal officials to continue the funding. An indication of the progress of those talks may have come on April 28 when he sued CMS for the funding. The governor has also visited Florida's congressional delegation in Washington to build support and, he said, convinced the House Energy and Commerce Committee to hold an as-yet-unscheduled hearing about the issue.
"Every day that passes without the Obama administration reversing course and continuing the Low Income Pool funding in Florida is just more proof that this absolutely is coercion," Scott said in a recent news release. "They will withhold these funds until we do exactly what they say."
Health care experts including Joan Alker, executive director of Georgetown University's Center for Children and Families, say the Scott administration has been in denial about the end of LIP funding.
"They didn't want to talk about Medicaid expansion and there's an inherent contradiction," Alker said. "'We want federal LIP dollars but we don't want federal Medicaid expansion dollars.' There's no rhyme or reason because [Medicaid expansion funding] would be larger and would cover people and would be much more reliable."
CMS Acting Director Vikki Wachino has told Florida officials that federal support of the LIP program will be based on three things: Use of Medicaid expansion dollars to cover uncompensated care, using Medicaid payments toward program beneficiaries, and adequate provider payment rates.
"We believe the future of the LIP, sufficient provider rates, and Medicaid expansion are linked in considering a solution for Florida's low-income citizens, safety-net providers, and taxpayers," Wachino wrote in an April 14 letter to Justin Senior, Florida's Deputy Secretary of Medicaid.
While Florida officials say that without LIP there would be more than $1 billion in uncompensated care and children's hospitals would lose $125 million, other groups with a stake in the budget have their own concerns.
Burleson, of the transportation builders group, says while he's concerned about what will happen with LIP funding, he's taken some comfort that the two chambers fully funded the state Department of Transportation and there were no cuts or money taken from the transportation trust fund during the first legislative session.
But Mark Pudlow, a spokesperson for the Florida Education Association, says that while he hasn't heard about any specific education programs or funding amounts that could be slashed if the House and Senate have to plug up the LIP funding gap, educators are still worried, especially as schools struggle to meet standardized testing requirements.
"We remain near the bottom when compared to other states as far as spending on public education is concerned," Pudlow said.
Pudlow said that the House and Senate proposed education budgets were similar but it's a toss-up now on how it'll turn out with the special session starting June 1.
"If there is a compromise it's going to potentially impact education funding in a state where we haven't funded education lavishly," he said.