Florida officials said late Wednesday that the federal government is suspending negotiations over the potential loss of more than $1 billion in money now flowing to the state's hospitals.
The move comes at a critical time: The Florida Legislature is trying to finalize a new state budget between now and the end of the session on May 1. Senate Republicans have vowed that they will not vote for a budget if it requires large cuts to hospitals.
Agency for Health Care Administration Secretary Liz Dudek said that federal officials are halting negotiations for at least two weeks because a top official is not available.
"This was sudden and disappointing news," Dudek said in a statement. She added that the decision to discontinue negotiations now "is troubling and could signal the abrupt end of this federal healthcare program in Florida."
Federal officials did not respond in detail to Dudek. But a spokesman for the Centers for Medicare and Medicaid Services said the federal government remains "in contact with the state."
The fate of the hospital program, known as the "low-income pool" and which reimburses hospitals for treating the poor and uninsured, has become the major dividing point between the House and Senate this session.
Florida has a projected budget surplus of more than $1 billion. Federal officials warned the state last year they would not extend the hospital money beyond this year. That led the Senate to craft a replacement program that it wants the federal government to consider.
Senate Republicans have also pushed to offer health care coverage to 800,000 Floridians that would draw down federal money linked to President Barack Obama's health care overhaul. Senate President Andy Gardiner sent two state senators to Washington, D.C., this week to share with federal officials what the Senate is proposing.
But House Republicans, who are opposed to any expansion of Medicaid, have contended that the federal government could renew the hospital money without expanding Medicaid coverage.
U.S. Sen. Bill Nelson, who has also talked to federal officials, disagrees and said the two issues are linked. Nelson, who met with legislative leaders at the Capitol on Thursday, told reporters that some of the hospital funding now goes to pay to treat patients who would be covered under Medicaid expansion. Nelson, a Democrat, said the "day of reckoning" is near and that legislators needed to act now.
"We shouldn't be playing a game of chicken when we are talking about the health care for over 1 million people in the state of Florida that do not have health care now," Nelson said.
House Speaker Steve Crisafulli put out a statement blasting the Centers for Medicare and Medicaid Services and federal officials for suspending negotiations with the state and said the state would not be "bullied."
"The federal government is doing everything they can to force Florida to expand Medicaid under the ObamaCare model," said Crisafulli.
Gardiner acknowledged that if talks between the federal government and state officials are suspended for two weeks it "becomes somewhat of a challenge" to wrap up work on a new state budget by the end of April. That could force legislators to finish work on a budget during a special session.
"At this time, the Senate believes it has done everything possible to advance solutions to the health care challenges facing Florida," Gardiner said in a statement. "The time has come to find common ground and present a unified solution that is best for Floridians. We hope others will join us at the table to discuss a way forward."
