Hospital leaders are criticizing state proposals to cut Medicaid funds

Hospital leaders are voicing concerns about budget proposals in the state House and Senate that would cut funding for hospitals that treat the most vulnerable patients.

Both chambers’ budgets would eliminate about $300 million for what is known as the “critical care fund." This money is used to give automatic rate enhancements to a group of safety net hospitals in the state that treat large numbers of Medicaid patients, who include Florida’s elderly, children, low-income families and people with disabilities.

The House also recommended cutting $100 million in state Medicaid reimbursement money to all hospitals, which is matched by federal funds, and would divert that money instead to higher education to train future nurses.

Lawmakers argue hospitals are doing well financially and have access to federal Medicaid funding through a new program known as Direct Provider Payment.

Mary Mayhew, president and CEO of the Florida Hospital Association said that money was meant to supplement state dollars, not replace them.

“So we are very concerned that that is being used as an excuse to cut reimbursement rates and the state funding for patient care,” she said. “…And this is at a time when the state has over $7 billion in additional unbudgeted revenue and surplus in the Medicaid program."

Mayhew said she appreciates efforts to address the staffing shortage hospitals are facing, worsened by the coronavirus pandemic, but she said cutting funding at the same time won't solve the problem.

“The funding that we receive for the care provided to Medicaid patients helps to pay the salaries of the nurses, the doctors, the physical therapists, the respiratory therapists,” she said. “So cutting that funding to provide to the Department of Education is worse than a zero-sum gain, you are actually digging a deeper hole for hospital as we try to address the severity of the workforce shortage.”

Lawmakers in both chambers will negotiate over the next couple weeks and must come to an agreement on a final budget by the time the legislative session ends on March 11.

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