Nelson Plan: Use Local Match
U.S. Sen. Bill Nelson cranked up the hopes of many Democrats last week by hinting that he had a plan that might revive the moribund Medicaid expansion in Florida, which would cover those too poor to qualify for tax credits on Healthcare.gov.
Now, the idea has taken shape with the release of a letter from Nelson, D-FL, to a high-level federal health official. It says that maybe state Republicans who object to expansion of Medicaid as called for under the Affordable Care Act might budge if the match money required after the first three years were supplied by local hospital districts.
The plan faces tough sledding, in that the leaders of the Florida House and Senate want to use that hospital district money -- much of it from Miami-Dade and Broward Counties -- to pull down federal match that would be given to HMOs participating in Medicaid statewide managed care.
Dated March 26, Nelson's letter is addressed to Marilyn Tavenner, chief of the Centers for Medicare and Medicaid Services (CMS):
"As a result of your willingness to consider innovative plans, stakeholders in Florida have embraced the challenge and worked to develop a potential solution that would use local dollars to support statewide Medicaid expansion when the full federal financing for the expansion population expires at the beginning of 2017. It is estimated that every day the state of Florida does not expand Medicaid, we lose out on $7 million in federal funding. And every day we hesitate, this year’s state legislative session draws closer to its close.
"According to initial estimates, the plan would provide coverage to all of the 1.2 million Floridians who fall under 138 percent of poverty – 764,000 of which have no option for affordable coverage at this time.
"Many states use intergovernmental transfers, known as IGTs, to help finance their “state share” of Medicaid expenditures. Under this proposal, local IGTs would be transferred to the state Medicaid agency, in compliance with federal requirements, to pay for any state cost as it relates to Medicaid expansion after the 100 percent federal financing for the expansion population expires.
"Some elected leaders in Florida who object to Medicaid expansion do so because they believe it could put additional burden on state finances. This plan eliminates that concern since the cost of health care would be covered through IGTs, thereby removing the state’s fiscal obligation.
"Other objections have focused on a lack of flexibility from CMS. Your track record of allowing states to adopt delivery models that best suit their unique preferences should alleviate that concern. From Arkansas to Michigan, you and your team have worked to allow states to bring new beneficiaries into Medicaid in a way that didn’t follow the traditional path but delivered the desired result.
"I think you would agree that such a locally financed plan is worth formal consideration and I will continue to work with interested parties to encourage the state to officially offer such a plan.
"Additionally, I would like to thank you for the work you continue to do on our state Section 1115 Medicaid waiver extension. It is very important that the waiver proposal and the above concept for Medicaid expansion be considered separately. In fact, I respectfully request that you finalize a one-year Section 1115 Medicaid waiver extension at current funding levels as soon as possible.
"I hope that you can provide an indication as to whether HHS would consider further, formal discussions with the state on such a plan. I look forward to working with you to break the stalemate and allow for Medicaid expansion in Florida."