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Florida rejects another $1 million federal health insurance reform grant

TALLAHASSEE — Using as ammunition a Florida judge's ruling this week that the federal health care law is unconstitutional, state officials are wasting no time stepping away from the controversial overhaul.

Their latest move: Rejecting a $1 million federal grant awarded to the Agency for Health Care Administration to plan a system required by the law where consumers can comparison shop for health plans.

It's the second federal health care reform grant rejected by Florida this week.

On Tuesday, Insurance Commissioner Kevin McCarty returned a $1 million grant that would have provided a resource for consumers to monitor insurance rate changes and how premiums are spent.

U.S. District Judge Roger Vinson on Monday ruled that the federal law is unconstitutional because it requires individuals to buy insurance or face a tax penalty, a provision known as the "individual mandate." He did not issue an injunction, but said he expected his ruling to be the "functional equivalent" of one.

Gov. Rick Scott, who before he ran for office founded the nonprofit Conservatives for Patients' Rights to fight the federal health care overhaul, has said he doesn't want to spend time or money on the law until the Supreme Court rules.

And that goes for the AHCA grant, which was rejected Thursday. The agency received the money in September, although none of it has been spent.

"With Obamacare ruled unconstitutional, we are working closely with state agencies to determine the ruling's impact on taxpayers and small business owners," said Jennifer Meale, a spokeswoman for the governor.

U.S. Rep. Kathy Castor, D-Tampa, on Thursday wrote a letter to McCarty urging him to reconsider the decision to reject $1 million for consumer monitoring.

Castor pointed out that the new law requires that 80 to 85 percent of premiums and copayments be spent on health services rather than administrative and advertising costs.

"If you do not begin the transition from 65-70 percent medical loss ratio to 80-85 percent required by law in 2014, Florida families will receive less value for their insurance dollar and companies are certain to claim that they cannot make a transition overnight," Castor wrote.

And Florida's six Democratic members of Congress tried to apply pressure on Scott's administration, asking if it would also decline to enforce policies embedded in the health care overhaul, including an allowance for young adults to stay on their parents' plans until age 26, a prohibition on lifetime coverage caps, and coverage of preventative services such as mammograms and flu shots without cost sharing.

"Slow-walking the implementation of the health care reform law shows a shocking lack of awareness of the health care needs of Florida working families and small business owners, but it also shows a shocking lack of fiscal responsibility," said Rep. Debbie Wasserman Schultz, D-Weston. "Why they are returning $1 million to anyone when the state faces a $3.6 billion shortfall is beyond me."

Meanwhile, attorneys in Virginia have asked the U.S. Supreme Court to take a look at that state's lawsuit. A federal judge ruled in December that the individual mandate is unconstitutional, though he declined to strike down the entire law as the Florida judge did.

Attorneys for the federal government appealed the ruling, but Virginia officials want to bypass the appeals court and go straight to the Supreme Court.

Florida Attorney General Pam Bondi, who is leading Florida's lawsuit that includes 25 other states, has said she would like to go the same route.

Two other federal judges have upheld the law.

Times staff writer Alex Leary contributed to this report. Janet Zink can be reached at or (850) 224-7263.

Florida rejects another $1 million federal health insurance reform grant 02/03/11 [Last modified: Thursday, February 3, 2011 9:42pm]
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