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DeSantis Goes Light On Medicaid Cuts

DeSantis standing at a podium in front of US Flag
Florida Governor's Office
The Florida Channel
Leon County Judge John Cooper on June 30, 2022, in a screen grab from The Florida Channel.

As a congressman, Ron DeSantis carved out a name for himself railing against Medicaid spending. 

But as a newly elected governor, DeSantis released a $91.3 billion proposed spending plan Friday that, for the most part, maintains the status quo for Medicaid providers in Florida. The plan recommends that hospitals, HMOs and nursing homes be paid at levels state economists recommended in December for treating poor, elderly and disabled patients.

DeSantis’ proposed budget would allocate $29.1 billion to the state Agency for Health Care Administration, with about $112 million going to regulation of health-care facilities, ranging from hospices and nursing homes to hospitals and ambulatory surgical centers. The rest of the money is targeted toward Medicaid.

Florida law requires the governor to submit to the Legislature a proposed spending plan each year. It doesn’t have the weight of law but provides lawmakers with insight to the governor’s spending priorities for the upcoming year.

The DeSantis budget also would appropriate $3.3 billion to the Florida Department of Children and Families, $3.1 billion to the Florida Department of Health, $340 million to the Florida Department of Elder Affairs and $131 million to the Florida Department of Veterans’ Affairs.

Although DeSantis released his proposed budget Friday, he didn’t release what’s known as the “implementing bill,” which details proposed changes in law that are needed to carry out spending decisions.

While DeSantis’ proposed Medicaid budget is largely a continuation of the current-year spending plan, budget officials did not rule out the possibility that it could change if Mary Mayhew, DeSantis’ appointee to run the Agency for Health Care Administration, pushes for broad changes such as a Medicaid block-grant program.

DeSantis’ budget proposal would make permanent a $98 million reduction in Medicaid spending that was backed by the Legislature last year. The cut is a result of eliminating a “retroactivity” policy in which the state has picked up health-care bills while patients prepare to enroll in the Medicaid program.

Former Gov. Rick Scott’s administration received approval from the federal government to waive a requirement that the state absorb health-care bills of people while they gather information necessary to apply for Medicaid coverage. But in a letter to state officials, federal Centers for Medicare & Medicaid Services Administrator Seema Verma told state officials the reduction expires with the June 30 end of the current-year budget, unless the Legislature agrees to make the cut permanent. The annual legislative session will start March 5.

Senate President Bill Galvano, R-Bradenton, told reporters this week that the Senate has “not resolved what direction we’ll go” on the retroactivity issue.

House Speaker Jose Oliva, R-Miami Lakes, said the future of the $98 million cut, which impacts an estimated 39,000 elderly and disabled patients, was part of a larger legislative conversation.

Otherwise, DeSantis’s proposed budget includes enough Medicaid money to cover what economists predicted in December would be needed in the coming year if no changes were made in policies.

DeSantis’s choice to not make spending reductions in Medicaid distinguishes him from Scott, who left the governor’s office last month. In seven of his eight years as the state’s top executive, Scott recommended deep reductions in the amount of money Florida spends on hospitals.

The Safety Net Hospital Alliance of Florida released a statement Friday lauding DeSantis for his proposed spending plan.

“We are happy that the Governor DeSantis budget makes solid health care investments and demonstrates his commitment to protecting access for children and mothers in need to complex medical care,” Justin Senior, chief executive officer of the Safety Net Hospital Alliance of Florida, which represents public, children’s and teaching hospitals, said. Senior served as AHCA secretary under Scott.

DeSantis also included some new funding initiatives in his plan. For example, documents distributed by the DeSantis administration show that his proposed budget provides an additional $1.3 million to increase epidemiology and surveillance to address opioid-related issues.

The budget plan includes $1.2 million to implement an electronic-verification program for behavioral analysis providers, who treat children with autism. The governor’s office contends the money would help crack down on fraudulent billing in the program but didn’t have estimates of savings.

In addition, DeSantis’ budget recommends $6.5 million in state funding for capital improvements for state veterans’ nursing homes and $3.4 million for operating costs of the Lake Baldwin State Veterans’ Nursing Home in Orange County.