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Legislature 2004

Gov. Bush begins Medicaid test

An effort to transform the $14-billion program starts with items scattered in this year's budget, which surprises some.

By ALISA ULFERTS
Published April 30, 2004

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TALLAHASSEE - The Medicaid revolution has begun.

Officially, Gov. Jeb Bush's plan to dramatically transform the state's $14-billion health care program for the poor will take months, even years.

But to the surprise of many lawmakers, the seeds of the governor's effort already are scattered through the state budget the Legislature is expected to approve before it adjourns tonight.

The most controversial: a study that will lead to an experiment that will turn over Medicaid long-term care to HMOs in some counties that have not been determined.

Under that approach, all Medicaid services for seniors, including nursing homes, assisted living homes, adult day care and home-delivered meals, would be coordinated by managed care organizations.

Also set: statewide expansion of another experiment directing Medicaid psychiatric patients to HMOs.

Those issues have caused the most angst among lawmakers. But they are far from the only changes to the state-federal health care program that are embedded in the budget.

Others include plans to move some Medicaid patients into affordable but bare bones private health insurance plans, preauthorization of some services like home health care and a pilot project to move some HIV patients into managed care.

All the changes require federal approval. But the governor expects support from his brother, President Bush.

He already has the support of legislative leaders.

"Sooner or later we have to get a handle on these costs," said Senate President Jim King, R-Jacksonville, who is counting on Gov. Bush's Medicaid changes to help control costs, which have doubled in the past six years.

Bush's ultimate plan is to end Medicaid as an entitlement, at least in Florida. That likely would involve a cap on federal payments to the state, which would help stabilize costs but end the guarantee of coverage for all residents who qualify.

The governor suggested that approach nationally last year but failed to convince other governors and Congress. So he decided to use Florida as a Medicaid test tube.

But some lawmakers complain that too many changes are being made behind closed doors.

One example is the plan to have as many as 600,000 Medicaid patients get mental health care through HMOs.

"There was no legislation to be discussed in the Senate, so I felt confident the issue was dead," said Sen. Walter "Skip" Campbell, D-Ft. Lauderdale.

It's not uncommon for state health officials, and businesses vying for state health contracts, to insert smaller pilot projects in the state budget.

But this year, lawmakers say the budget's pilot projects are much larger than anything attempted before. They amount to major policy changes that went almost unnoticed because they were written into the state's 389-page spending plan, not debated individually in public committee meetings.

Some lawmakers and lobbyists misuse the budget process, said Sen. Tom Lee, R-Brandon, who supports some of the Medicaid proposals: "They stick their stuff in the budget in the last week, and I have always thought that was wrong." Part of Bush's vision for a new Medicaid involves shifting some of its healthier patients into private, low-premium, bare bones insurance plans.

The budget calls for a pilot project to make such plans available to Medicaid patients in Palm Beach and Miami-Dade counties.

"It's a way to make flexibility available for the healthier people," said Christine Osterlund, a spokeswoman for the Agency for Health Care Administration.

Adding more healthy people, such as kids, into the private market has the dual purpose of spreading risk around a larger pool of people and lowering costs for everyone, including the state, officials say.

Another budget item would study how some people use certain services, like physical therapy or home health care, to develop a procedure similar to the gatekeeper function of an HMO.

"It's to make sure that the services we are contracting for are appropriate," Osterlund said. The state would not deny services; rather, the intent is to make sure patients get enough to ensure they stay as healthy as possible, which is better for them and cheaper for the state, Osterlund said.

State health officials say doing nothing would mean budget cuts to health care providers.

Nursing home costs are a big reason for the escalating Medicaid budget. Now, payments will be cut 5 percent. The budget deal also limits so-called bed-hold days, when the state pays a nursing home to keep a bed available for a patient in the hospital.

"Some of you may not agree that reform is needed, or at least the fundamental reform the governor is proposing," state Medicaid director Bob Sharpe told Medicaid care providers and patient advocates Thursday. "But you all looked at the budget. You know that providers are the ones who took the hits this year."

- Times staff writers Stephen Nohlgren and Jennifer Liberto contributed to this report.

[Last modified April 30, 2004, 01:05:39]


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