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Florida Legislature 2005 (click for ongoing coverage)

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Bush Medicaid plan is stalled in Legislature

Lawmakers are looking to save millions of dollars, not the billions the governor wants this session.

By ALISA ULFERTS
Published April 16, 2005

TALLAHASSEE - When it comes to the Florida Legislature, what Gov. Jeb Bush wants he often gets.

School vouchers. Corporate tax cuts. Hundreds of millions of dollars for a research institute.

But his plan to transform Medicaid into a government funded health insurance plan has run into unexpected opposition in the Republican controlled Legislature.

With three weeks left in the 2005 Legislature, lawmakers are more interested in small pilot projects, feasibility studies and smaller, money-saving plans that could save a couple of hundred million dollars, not billions, as Bush wants.

Big changes may have to wait until next year.

It marks a major step back for legislators, who last year gave Bush broad authority to negotiate changes with the federal government without knowing what he wanted to do.

Public hearings across the state opened lawmakers' eyes to the Herculean task before them. Now they want more time.

If nothing happens this year, Bush will have one more legislative session before he leaves office. But he will have less clout next year, when the race to pick his successor is in full swing.

Further endangering Bush's proposal is a significant rift between the House and Senate. The Senate suggested myriad small changes to buy time. The House has largely ignored short-term savings and proposed a plan similar Bush's but smaller in scope.

Neither side has shown much willingness to compromise.

Bush still hopes to get enough of his plan approved this year to begin testing its money-saving theories, but many observers say the proposal has lost much of the traction it needed to pass this year.

"I don't see anything passing beyond the pilot/demonstration projects," said Robert Wychulis of the Florida Association of Health Plans, the HMO trade group.

"Both sides at this point are looking more at analysis than implementation," Wychulis added.

Bush hasn't given up. He's always left open the possibility that his proposed changes could take two years, though he asked lawmakers to do it all this year. He sends officials with the state Agency for Health Care Administration to every legislative committee in which the topic is discussed to offer suggestions to move things along.

"I see the bills as a good place to start," state Medicaid director Tom Arnold said. "We'd still like to see the pilots expanded," Arnold added.

Across the nation, states are grappling with the same financial pressures: for the first time they will collectively spend more on Medicaid than on education. The federal government, which pays 61 percent of Florida's Medicaid tab, is also feeling the pinch. Washington wants to cut funding, states want more help from Uncle Sam.

From the start, Florida lawmakers have applauded Bush for taking on the issue but complained that his plan lacked detail. Bush himself called the plan a framework, and said he was relying on the health care industry to help flesh it out.

Rather than paying doctors and hospitals directly for treating Medicaid patients, Bush wants the state to pay HMOs and other health networks to cover the cost of caring for 2.3-million people. But he would largely allow the HMOs to decide on services.

To entice insurance companies to take some of Florida's sickest, poorest residents, Bush wants to cap Medicaid benefits as private insurance plans do. But the cap hasn't been set. Patients exceeding the cap would qualify for a special catastrophic fund, but exactly how that would work hasn't been determined.

Bush's goal is to rein in Medicaid's runaway costs, which will reach $17-billion in state and federal money next year if no changes are made. The program already gobbles more than a fourth of the state budget, though its growth rate is slowing down as the state's economy improves.

"I think the mind-set of the Senate is, step back, wait and take a deep breath," said Senate Democratic Leader Les Miller of Tampa.

The House and Senate have the same pilot project areas - Broward County for the urban area and Baker, Clay, Duval and Nassau counties for the rural area - in which managed care networks would get premiums to cover a Medicaid recipient's care.

Pensacola Republican Rep. Holly Benson, who's in charge of the House plan, said the bill might change to give AHCA more flexibility in choosing the pilot counties.

Like the governor's proposal, the House bill would allow some low-income Floridians to buy into Medicaid by paying a premium and some Medicaid patients to opt out of the program and have their private insurance subsidized by the state. Those who show good health habits, such as participating in a disease management program, could get extra money to cover services not covered under the new Medicaid program.

The House bill also would loan up to $500,000 to organizations that want to develop a network of health care services for Medicaid patients.

"I think we're seeing significant progress," Benson said of the House plan.

Advocates for the poor and disabled tend to favor the Senate plan. Besides being more cautious than the House bill, the Senate plan requires public notification for every change requiring federal approval.

"There are more checks and balances," Bob Sharpe, a former state Medicaid director and current director of the Florida Council for Behavioral Healthcare, said of the Senate plan.

The Senate plan includes further restrictions on prescriptions, oversight of doctors whose practices appear outside the norm and thus more expensive, and allows the state to increase what it spends in parts of Medicaid if that translates into savings for other parts of the program.

Senate sponsor Durell Peaden, R-Crestview, said he doesn't understand why the House is sticking so close to the governor's proposal.

"They're going to have to appreciate what we've put in our bill," Peaden said. "And if we pass something, it'll be that."

[Last modified April 16, 2005, 01:20:07]