Senate panel offers $1.2 billion increase in health budget

TALLAHASSEE - A Florida Senate panel proposed a $1.2 billion increase Wednesday in health care for low-income programs for the poor, fraud prevention and prescription drug abuse.

Money for the state's six agencies that handle health care administration, people with disabilities, children and families, elder affairs, public health departments and veterans affairs would increase from $34.3 billion to $35.5 billion in next year's budget.

The largest increase would go to health care administration, which deals with hospitals and the state-federal program known as Medicaid that provides health insurance for low-income residents.

The government health care program is expected to serve more than 4.1 million people next year, increasing the current $25.9 billion cost to $26.3 billion.

Medicaid consumes nearly a third of the state’s $80 billion-plus budget.

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Even given this growth in Medicaid enrollees and costs, the House health care subcommittee proposed a budget earlier this week that cut funding to the agency that administers the entitlement program by $228 million.

Most of these cuts came by slashing funding to hospitals that provide services to poor patients.

The Senate’s budget for that same agency grew by over $1 billion.

Most of the Senate increase is from a $608 million growth in nonrecurring supplemental payments that hospitals receive from the federal government for seeing Medicaid patients.

The Obama administration planned to phase out this program after the state didn’t expand Medicaid under the Affordable Care Act, but the Senate and Gov. Rick Scott are hopeful that President Donald Trump's administration will renew it.

More: Florida House panel proposes $622 million cut to hospital funding

“If we do nothing … that might not send the right message to Washington as far as the state’s commitment to hospitals and to Medicaid reimbursement,” Sen. Anitere Flores, a Republican from Miami who chairs the Senate’s health budget committee, said during the health appropriations subcommittee meeting Wednesday.

In addition, the Senate increases reimbursement rates to hospitals that see Medicaid patients by $11.7 million, while the House cuts them by $144 million. These rates create a kind of multiplier effect and can make the program more or less expensive over time, instead of serving as one-time cuts like supplemental payments do.

The Senate proposed cutting supplemental payments to hospitals, as did the House and Scott. But the Senate cuts were far less — $258 million, compared with the House's $478 million and Scott's $298 million — and were less targeted.

Flores said her committee cut supplemental funding to all hospitals by a third but exempted children's and rural hospitals after discussing some industry concerns.

While the House is leaning on cutting funding to health care to give tax breaks and fund its other priorities, the hospital friendly, more moderate Senate is signaling that keeping Florida’s health care system the way it is is a priority.

Senate President Joe Negron, R-Stuart, said his budget committees will strip old member projects that have since become irrelevant and use that money in other areas.

“We just do a better job of budgeting on our side,” Flores joked later in an interview about how the Senate could still expand the largest cost-creating program while also proposing tax cuts and funding other initiatives.

The Senate health budget proposal also proposes increased funding for the Department of Children and Families. The agency, currently funded at over $3 billion, would receive $70.8 million more in the Senate plan, compared with a $57.1 million decrease in the House proposal.

More: Florida legislators' budgets offer more for students; teacher bonuses shaky

The Senate committee’s recommended increase is mostly accounted for by two programs that are almost entirely federally funded: a fraud prevention initiative as well as a prescription drug prevention and treatment initiative. Each costs more than $27 million, and neither are included in the House's proposal.

The Senate also is proposing an increase for the Agency for Persons with Disabilities, which is currently funded at $1.3 billion. The Senate’s panel would increase funding by $21 million, while the House proposes decreasing it by $22 million.