January 26, 2010

January 26, 2010
Medicaid Troubles

Welcome to another day in my life. Today is Tuesday and I hope you are having a safe and great week so far.

I got off to a late start today. I spent another night with horrible headaches which make it almost impossible to sleep well. Even though they have doubled my blood pressure medications, I still feel like my head is going to explode at times. What I would give for a whole day without headaches. Luckily, I go to see my doctor again in a week while I am in Jacksonville.

But I am not the only one in trouble, I recently read some very disturbing news concerning Medicaid in Florida. But then with the way things are going on in our country, I guess I should not be surprised.

Put aside the furor about national health care reform. Florida leaders have a more immediate problem.

With jobs disappearing and incomes sinking, Floridians are increasingly turning to the government run Medicaid program for health care driving up costs and playing a major role in a potential $3 billion state budget shortfall next year.

The shortfall could lead to cuts in Medicaid, which serves low income, elderly and disabled people, while also forcing lawmakers to make tough election-year spending choices among health and education programs.

Crestview Republican Durell Peaden, chairman of the Senate committee that oversees health spending, gave a one word answer when asked about lawmakers' options in dealing with Medicaid: "Cut."

"Everything's up for grabs," Peaden said.

Medicaid is jointly funded by the state and federal governments, and Florida faces a shortfall of as much as $1.8 billion in paying for its share during the fiscal year that starts July 1.

Florida has grappled with increasing Medicaid costs for years, but projections for the 2010-11 year are eye opening: The program could serve nearly 3 million peopleat an overall cost of about $19.1 billion.

Karen Woodall, a longtime social-services lobbyist who works on Medicaid and children's health issues, pointed to Florida's struggling economy for the increasing number of Medicaid recipients and costs. Volusia and Flagler counties have seen double-digit percentage increases in Medicaid recipients during the past year.

"If we have (among) the highest foreclosure rates and the highest unemployment rates in the country, what do we think is going to happen?" Woodall said.

Gov. Charlie Crist is slated to release a proposed 2010-11 budget this week that will offer initial ideas about how to deal with Medicaid and the broader shortfall. But the real work will come during the annual legislative session that starts in March.

Senate President Jeff Atwater, R-North Palm Beach, made clear Wednesday he does not want to raise taxes to deal with the financial problems, largely echoing earlier statements by House Republican leaders.

"We must separate the requireds from the desireds," Atwater said. "The people of Florida do not have one more dime to send us."

But making that separation will not be easy, particularly because Medicaid and education are the biggest parts of the state budget. Lawmakers also have problems in education funding, including a drop in property tax revenues that are used for public schools.

"We are just looking for places that we can legitimately cut that will not hurt the delivery of educational services to children," said Sen. Steve Wise, a Jacksonville Republican who chairs the committee in charge of public school funding. "That is the bottom line."

Medicaid is a major part of Florida's health care system, with large chunks of money going toward costs such as hospital treatment for low income people and nursing home care for seniors.

When lawmakers passed the current fiscal year's budget in May, they expected Medicaid to serve about 2.6 million people at a cost of $17.5 billion. But those numbers have continued to climb during the year.

Florida is required to pay for some services in Medicaid, such as hospital and physician care.

Other services are considered optional and could be targeted for cuts. But at least some of those optional services, such as paying for prescription drugs and dialysis, would be difficult to reduce or eliminate.

While cuts in some programs are likely, lawmakers and health industry officials also are looking to Washington for more help in paying for Medicaid next year.

The federal government provides Medicaid money to states through a system of matching funds. Washington increased its share of Medicaid costs as part of last year's federal economic stimulus package, but the higher matching amounts are scheduled to expire in December 2010 the middle of Florida's fiscal year.

State leaders hope to continue receiving the higher amounts through the June 30, 2011, end of the fiscal year. If so, that could chop an estimated $745 million off the state's potential shortfall.

Deanna Schaeffer, governmental affairs officer for Halifax Health in Daytona Beach, said that not receiving the additional federal money would be debilitating to the Medicaid program.

Paul Belcher, a vice president of the Florida Hospital Association who previously worked on the Senate staff, told lawmakers last week the situation they face is "daunting."

"You have a challenge like I have not seen before in this state," said Belcher, who has been involved in the budget process for about 25 years.

At a Glance:

Gov. Charlie Crist this week is expected to propose a state budget for the 2010-11 fiscal year. The proposal is a first step as lawmakers prepare to pass a budget during the spring legislative session. Here are some key issues:

The state has a potential $3 billion budget shortfall, as expected costs grow faster than tax revenues.

Lawmakers face a shortfall of as much as $1.8 billion in the Medicaid health care program, as the economic recession has led to increasing caseloads.

A decline in property taxes will force lawmakers to come up with hundreds of millions of dollars to avoid cuts in funding for many day to day operations of public schools.

Senate and House Republican leaders have said they do not want to raise taxes to balance the budget, pointing to the tough economic times faced by many families and businesses.

So it look like rough times ahead. Those are my thoughts. What about yours? Drop me a line and let me know.

Until we meet again; here's wishing you health, hope and happiness.

big bear hug,

Daddy Dab