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Massive Medicaid Cuts Will Impact All Floridians

2008-04-11 09:07

The Florida Legislature's plans to cut hundreds of millions of dollars from Medicaid programs for the elderly, disabled and poor will put lives at risk and will negatively impact all Floridians, the leaders of Florida's safety net hospitals warned today.

Besides jeopardizing the health of Florida's most vulnerable citizens, the proposed cuts in state Medicaid spending will also wastefully forfeit as much as $280 million in federal matching funds and will lead to higher health care costs for all Floridians, the hospital leaders said.

As part of their effort to address the state's economic downturn, state legislators want to slash as much as $1.2 billion in crucial health and human services programs for the elderly, disabled, foster children and the poor. That includes cutting hundreds of millions of dollars from Medicaid programs that Florida's neediest citizens depend on to survive.

"It's time for all Floridians to ask themselves: Is this really the way you want your state to treat the most vulnerable people in your community?" said Tony Carvalho, President of the Safety Net Hospital Alliance of Florida. "And do you really think these drastic cuts won't impact you? The truth is, all Floridians will feel the effects of these huge Medicaid cuts."

By eliminating or restricting crucial Medicaid programs, legislators may be able to claim that they avoided raising taxes, tapping into trust funds, or using the state's "rainy day" reserves to ease the state budget shortfall, hospital leaders said. But in reality, all Floridians will bear the brunt of the Legislature's cost shift.

Local communities will be forced to raise local taxes for indigent care. More sick people will wind up in already overcrowded emergency rooms, forcing hospitals to provide even more free care, and driving up health costs for everyone else. Health premiums will rise, straining businesses and increasing the ranks of the uninsured in Florida -- where already, one in every four residents under 65 lacks coverage.

"Ironically, while the rest of the United States is debating ways to ensure that all Americans have health coverage, our Florida Legislature is heading in the opposite direction, reducing health coverage for our neediest citizens and increasing the uncompensated care in our health system," Carvalho said.

As part of the Medicaid cuts, legislators are targeting hospitals for huge cuts -- especially the state's safety net hospitals. While the Safety Net Hospital Alliance represents just 10 percent of all hospitals statewide, its members -- the bedrock public, children's, and teaching hospitals -- provide about 50 percent of all the Medicaid and charity care delivered in Florida. Yet, state lawmakers are eyeing safety net hospitals to bear nearly half of the total Medicaid cuts.

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Including budget cuts already made last fall, the state Senate is proposing about $637 million in total Medicaid cuts to hospitals -- including $287 million from safety net hospitals. Meanwhile, the state House is proposing $599 million in total hospital cuts -- $278 million would fall on safety net hospitals.

Two vital state Medicaid programs are especially at risk -- the Medically Needy program and the Medicaid Program for the Aged and Disabled.

Medically Needy is the only avenue for Florida's uninsured "working poor" to qualify for healthcare if they've been hit by a life-threatening illness, an organ transplant or a catastrophic injury. To qualify, a patient's income -- after deducting their medical expenses -- must fall below 22 percent of poverty guidelines, or just $2,160 in annual income for a single person. Nearly 20,000 Floridians depend on this catastrophic care each year. But many will lose their inpatient hospital or drug coverage if the Legislature moves forward with plans to eliminate or restrict the adult Medically Needy program.

The Aged and Disabled program serves low-income residents who are 65 or older, or are totally or permanently disabled. Many recipients receive institutional care, hospice services, or home- and community-based services. The state Senate wants to totally eliminate this program. If the Senate succeeds, 24,000 elderly and disabled people whose annual incomes fall below 88 percent of poverty guidelines -- that's $9,152 a year -- will lose their Medicaid coverage.

Additionally, legislators stand to forfeit $280 million in federal matching funds if they carry out the state Medicaid cuts to hospitals. That's because for every $1 the state cuts in state general revenue Medicaid funding, it loses $1.27 in federal funding for Florida's Medicaid programs.

With House and Senate leaders set to begin budget negotiations, time is running out for Florida's most at-risk citizens. Legislators have other reasonable options to avoid decimating these programs, but average citizens must speak out, safety net hospital leaders said.

"Safety net hospitals serve all patients, regardless of their ability to pay," Carvalho said. "Yet even safety net hospitals can't continue to offer the same level of services to our most vulnerable with budget cuts this large. We know that local communities and average citizens care about the less fortunate among them -- it's time for them to speak out."

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