Medicaid Claims vs Reality

[Guest guest]

FYI

The Legislature's Medicaid ResolutionKey Claims vs. RealityOne of the aims of last month's special session of the Legislature was to set the tone for efforts to overhaul Medicaid during the upcoming regular session. Legislators adopted a “memorial” (resolution) urging Congress to give the State more flexibility to do as it sees fit with Medicaid. Although the memorial changed no laws or rules, the intent was to “send a message”. The message was that Florida wants federal money for Medicaid, but not the responsibility for protecting patients who must rely on it. Worse, the justification offered for that message was misleading and often inaccurate. For example:Memorial Claim #1: Decisions by the Legislature about funding Medicaid can be made only after considering “the ongoing tax burden placed on Floridians, the State's available resources and other State obligations.”Reality:• By this June, Florida will have received more than 6 billion extra in federal stimulus dollars to protect Medicaid during the recession. The Legislature, however, has used much of that money to replace State general revenue that had been invested in Medicaid. The money that was freed up was then shifted away from Medicaid for unrelated purposes. That created the false impression that Medicaid had dug a deep budget hole for Florida, when in fact the Legislature itself dug it. • Florida chooses to participate in Medicaid, and for good reason. Our participation in Medicaid not only ensures essential health care access, it also provides a major boost to the state's economy. Every dollar of State general revenue used to fund Medicaid draws down three dollars more in federal money. That doesn't even include the economic impact generated when Medicaid-funded providers like hospitals purchase supplies, hire workers, etc.• Medicaid expansion under the Affordable Care Act (ACA) will further improve Florida's budget situation, not make it worse. From 2014 through 2019, each State dollar invested in Medicaid coverage for the newly insured will bring in 16 federal dollars. Even after the State match rate reaches its maximum level in 2020, the State's return will be 9-to-1. Memorial Claim #2: The ACA requires coverage of at least 1.8 million new Medicaid recipients in Florida. That is an unfunded federal mandate that will crush Florida.Reality:• That claim is based on both inaccurate data and unrealistic assumptions. For one, it assumes that every low-income Floridian will become eligible for and enroll in Medicaid. However, many will in fact remain ineligible (e.g., undocumented immigrants). Others are already eligible but still won't sign up (and many are exempt from the “individual mandate”). Still others will have other sources of coverage such as a job or the new health insurance exchange.• Current enrollment in Florida Medicaid is just under 2.9 million. Based on reasonable assumptions, about 1.1 million more Floridians will enroll in Medicaid by 2019 because of Medicaid expansion.• Far from crushing Florida, expansion will increase total State spending on Medicaid by less than 2% from 2014 to 2020. If Medicaid didn't expand, Florida would pay more than that in the form of uncompensated care costs that are shifted to others.Memorial Claim #3: The ACA takes away the State's ability to set Medicaid eligibility requirements and undermines the federal-state Medicaid partnership. Reality:• Medicaid is and will continue to be a partnership. To protect the vulnerable, however, federal Medicaid law has always included minimum requirements. States have great flexibility beyond that bare minimum, however. • Although more Floridians must be made eligible for Medicaid under the ACA starting in 2014, the feds pay almost the entire cost of the expansion (see above). Savings due to lower uncompensated care costs for local and state governments more than cover the rest.• Under the ACA, the Legislature can't tighten current Medicaid eligibility rules. If they could, however, they would target people with catastrophic medical bills (Medically Needy). They would also likely target some seniors, pregnant women and youth. The memorial is the Legislature's complaint to Congress that it needs the authority to make such cruel cuts.• By contrast, legislators can still cut patient benefits as well as reduce payments to providers. Plans to do so again in 2011 are already under discussion. • The State already has some of the flexibility it's telling Congress it needs - in the Pilot counties for the Medicaid Reform experiment. That experiment, underway since 2006, has been fraught with problems. Yet the Legislature insists that it needs more flexibility. If they get it, many more recipients will be placed at even greater risk.