TALLAHASSEE — Against the wishes of counties and tea party leaders, Gov. Rick Scott signed a controversial bill into law Thursday that will change the way counties are billed for Medicaid costs and could set up a legal showdown.
If nothing changes, counties could be forced to pay the state an additional $325.5 million in the coming years in disputed Medicaid bills.
"Nobody really knows what this is going to mean to our budget," said Gretchen Harkins, Broward County director of intergovernmental affairs. The Florida Association of Counties has convened a task force to recommend future steps, such as seeking an injunction or filing a lawsuit.
Scott took the unusual step of submitting a letter to the Secretary of State's office explaining why he signed the bill, HB 5301. Scott acknowledged the counties' concerns and vowed to work with them to resolve years of disagreements with the Agency for Health Care Administration on how much they owe for Medicaid.
"To that end, I have pledged to the counties that AHCA and my staff will work diligently with them to certify that any billings for which counties are charged are accurate and valid," Scott wrote.
Representatives from AHCA will travel to each county to review the disputed amounts and discuss other issues with the billing process, the letter said. Counties say the system has been flawed for years, resulting in incorrect and duplicative statements.
Under the plan, counties can dispute the unpaid Medicaid bills in administrative hearings but are on the hook for paying back 100 percent of the backlog if they lose. Or, counties can agree up-front to pay back 85 percent of the disputed bills.
The state will withhold sales tax revenue sharing dollars from counties to cover past, as well as any future, Medicaid costs.
All but seven of the state's 67 counties sent Scott letters urging him to veto the bill. They accused the state of tinkering with the Medicaid billing system in an effort to shift additional costs to local governments.
Florida Association of Counties President Doug Smith said the bill "represents the worst kind of body blow to taxpayers."
"Rather than correcting Tallahassee's error-ridden Medicaid billing system, HB 5301 codifies it and leaves local taxpayers with the bill," said Smith, a Martin County commissioner, via email.
The Florida Tea Party Network, a coalition of about 80 groups, joined the counties in lobbying against the proposal. Henry Kelley of Fort Walton Beach, the Tea Party Network's legislative liaison, said he was disappointed in the governor's actions.
"From a tea party perspective (and) the issue of limited government, now you're tying the hands of the counties," he said. "But you're also signing into law something where you know there's a billing problem."
Although the Medicaid billing issue drew the most attention, HB 5301 affected other areas of the state's Medicaid program, which provides health care services to 3.2 million poor and disabled Floridians.
It cuts costs by limiting nonpregnant adults to no more than six emergency room visits a year and allows state employees to enroll their children in the KidCare health insurance program.
Scott also signed nine claims bills into law Thursday, compensating victims of government wrongdoing nearly $40 million.
The parents of slain police informant Rachel Hoffman of Clearwater will be compensated $2.4 million. Hoffman, 23, was killed during a botched drug sting.
Most jury awards against government entities or employees — school bus drivers, hospital workers, police officers — have to be approved by the Legislature if they are in excess of $200,000.
The governor used his first veto this year to strike down a bill that would have given $1.4 million to a man who lost a leg in an accident with a Sumter County school bus, indicating that the amount was too high.
Times/Herald staff writer Toluse Olorunnipa contributed to this report.