Florida lawmakers have agreed to shut down an endowment fund named after former Gov. Lawton Chiles as part of final budget-related negotiations in the closing days of the 2021 legislative session.
The House and Senate have also agreed to require nursing homes to file financial statements with the state.
Both decisions were made Wednesday in a final meeting between Senate Appropriations Chairwoman Kelli Stargel, R-Lakeland, and House Appropriations Chairman Jay Trumbull, R-Panama City. They signed off on so-called “conforming” bills that authorize changes in state law that go along with a new state budget that will be voted on Friday.
The Chiles fund was created in 1999 at the urging of then-Gov. Jeb Bush and included proceeds from a landmark legal settlement in the 1990s between the state and tobacco companies. It was named after Florida’s last Democratic governor, who pushed for the lawsuit that led to payments from major cigarette makers.
The fund was aimed at providing perpetual support for health care programs and biomedical research. But Trumbull defended scuttling the endowment and folding the money into the state’s budget stabilization fund, which is a reserve. The fund had a market value of $958.4 million at the end of 2020, according to a House staff analysis.
“It all goes back to making sure we have ample reserves,” Trumbull said.
The Senate also agreed to a proposal by the House to require nursing homes --- and their home offices --- to file financial statements with the state within three months of the end of their fiscal year.
The filings must be based on internal financial reports certified as complete and accurate by the nursing homes’ chief financial officers. The filings must include fiscal year-end balance sheets, income statements, statements of cash flow and statements of retained earnings.
The proposal initially would have required the financial reports to be audited by independent certified public accountants.
The state’s largest nursing-home group, the Florida Health Care Association, said requiring financial statements to be independently audited would have substantially driven up regulatory costs.
“We recognize the importance of transparency and the need to make data available. Currently, state and federal requirements call for nursing centers to submit Medicaid and Medicare cost reports and daily staffing data,” Florida Health Care Association President and CEO Emmett Reed said in a prepared statement to The News Service of Florida. “Adding independent audits to coincide with financial reports would have cost the long term care profession between ($16 million and $20 million) annually, and we believe that money can be better spent on paying long term care staff and improving resident quality of life. We appreciate lawmakers for removing that component and understanding the financial and administrative burden that it would have imposed.”
Hospitals have long been required to file similar reports, but this is the first time the state has required nursing homes to do the same.
“We get asked a significant amount by members, by staff and others about specific issues related to the financial viability of nursing homes, so one requirement we put in this language was to have them report financials every year, sort of like hospitals do to have it very clear on where we are spending taxpayer dollars,” Trumbull said.
Trumbull and Stargel said they weren’t sure why the state hasn’t required nursing homes to report the information all along.
“We thought it was a good idea,” Stargel said.
