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$1B in cuts in Senate HHS budget

When Sen. Joe Negron released a proposal Monday to cut at least $1 billion from health- and human-services programs, it was a first step in what likely will be a contentious budget process.

The proposal immediately drew criticism for deep cuts to hospital funding, mental-health services and the Medically Needy program. And Tuesday, Negron's House counterpart will release a budget proposal that will differ on key issues.

Negron, a Stuart Republican who is chairman of the Health and Human Services Appropriations Subcommittee, said the Senate proposal still calls for spending about $28 billion next year --- even with the cuts. That comes at a time when the state is struggling with an overall budget shortfall of nearly $3.8 billion.

"We can only spend the money we have,'' Negron said. "This budget reflects our considered judgment on priorities. I acknowledge that we had to make difficult choices. But $28 billion is a significant appropriation for health and human services for 19 million Floridians.''

But Senate Minority Leader Nan Rich, D-Weston, said the proposal would severely damage the health-care safety net in Florida. She said the Senate needs to set aside additional money for health and human services.

"The bottom line is, there's just not enough money here,'' said Rich, who is vice-chairwoman of Negron's committee.

The biggest clash could happen in the coming weeks when Senate and House negotiators try to reach agreement on a spending plan. House Health Care Appropriations Chairman Matt Hudson, R-Naples, would not disclose details of his budget proposal in advance of releasing it Tuesday.

But during an interview Monday, Hudson made clear that the House proposal will not include deep cuts to the Medically Needy program or to mental-health and substance-abuse services --- key elements of the Negron proposal.

The Medically Needy program serves people who have debilitating medical conditions but don't qualify for Medicaid. The Senate proposal would stop paying hospital and drug bills for the thousands of Medically Needy patients, while continuing to pay for less-expensive physician services.

Hudson and House Speaker Dean Cannon, R-Winter Park, are concerned that hospitals would get stuck providing uncompensated care to the patients if the state stops paying for it.

"The House budget will not adopt strategies to control Medicaid spending that result in cost shifts toward the other aspects of our state-funded health care infrastructure, including driving uncompensated care into our public hospitals and emergency departments,'' Cannon wrote in a memo to House members Monday.

The release of the Senate proposal is just the first of several steps in passing a health- and human-services spending plan for the fiscal year that starts July 1. The Senate and the House will approve different versions of the budget before negotiating a final agreement, likely near the end of the 60-day legislative session.

Negron said the Senate proposal would cut about $1 billion in state general-revenue funding for health and human services. But the actual amount of cuts likely is hundreds of millions of dollars more because the state also would lose federal matching money for many of the cuts.

Senate staff members were working on a bottom-line number Monday, but Negron said the total probably would be roughly $1.5 billion.

The biggest chunk of cuts, about $438 million, would come from 10 percent reductions in Medicaid rates for hospitals.

Nursing homes, meanwhile, would face 5 percent Medicaid rate reductions, totaling $144 million. The hospital and nursing-home totals include state and federal money.

Other cuts would dramatically reduce state funding for outpatient mental-health and substance-abuse programs. As an example, the proposal would eliminate $27.2 million for adult substance-abuse services.

Negron said the budget proposal prioritizes spending in areas such as substance abuse. While it would eliminate services for adults, the proposal would continue paying for substance-abuse treatment for teens --- which Negron said is a higher priority.

Similarly, while the proposal would cut funding for many mental-health programs, it would continue paying for so-called "crisis beds" needed for emergency inpatient treatment.

But Karen Koch, vice president of the Florida Council for Community Mental Health, said the mental-health cuts still would have "pretty devastating" effects.

"We may have crisis beds, but (with the outpatient cuts), we have no place to discharge them after the crisis,'' Koch said.

The Senate proposal also includes dozens of other types of cuts across the health- and human-services budget. Those cuts range from a $14 million reduction in fees for pharmacists who dispense Medicaid prescriptions to chopping $4.8 million in funding for the Florida Area Health Education Centers.

Those so-called AHECs are affiliated with medical schools and are involved in tobacco cessation and other community-health programs across the state. Rich described that proposal as a "big loss.''

"We know the value of preventive health care, and the tobacco program is the perfect example,'' Andree Aubrey, president of the Florida AHEC Network, said during a recent interview.

--Capital Bureau Chief Jim Saunders can be reached at 850-228-0963 or by e-mail at jim.saunders@healthnewsflorida.org.