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Florida gets Medicaid dollars via coronavirus relief package

In order for states to be eligible, they must not restrict Medicaid eligibility, nor are they allowed to raise premiums. They must also put a freeze on terminating coverage for those already enrolled in the program.

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TALLAHASSEE — A coronavirus relief bill signed into law last Wednesday addresses provisions like paid sick leave, nutrition assistance and unemployment benefits for those affected by COVID-19, the illness caused by the novel coronavirus.

The Families First Coronavirus Response Act also includes a provision that would allow states to draw down a significant chunk of cash for Medicaid, the public health insurance program for low-income people. The provision increases the Federal Medical Assistance Percentage, or FMAP, to 6.2%, which equates to about $1.2 billion in federal dollars, according to rough estimates by Florida House staff.

However, the match rate increase comes with terms.

In order for states to be eligible, they must not restrict Medicaid eligibility, nor are they allowed to raise premiums. They must also put a freeze on terminating coverage for those already enrolled in the program.

Florida, one of only 14 states that has not strengthened its Medicaid program under the purview of the Affordable Care Act, has agreed to accept the terms.

Mary Mayhew, secretary of the Agency for Health Care Administration which administers the state’s Medicaid program, told the Times/Herald that by accepting the money, the agency automatically agrees to comply with the requirements.

The increased match would lower the pressure on states as the average spending on medical care may be increasing as a result of the pandemic. The increase is retroactive to Jan. 1 and good for the duration of the public health emergency in the U.S.

Medicaid enrollment is expected to swell as unemployment numbers rise due to COVID-19-related business closures and Floridians lose income and access to employer-based health insurance. There are currently about 4 million Floridians enrolled in the program

While the money will help, Mayhew said, the unemployment numbers expected to be released Thursday may have a dramatic impact on the increases of Medicaid enrollment, even beyond what the federal dollars may be able to mitigate.

“We have to anticipate we will see a significant increase in expenditures for the state’s Medicaid program,” Mayhew said. “But it helps no matter what.”

Rep. Nicholas Duran, D-Miami, said he has pushed the idea with Mayhew since even before the legislation was passed in Congress.

Duran said the $1.2 billion is a “good deal of dough” with respect to the constraints the state will face as more Floridians become eligible for the Medicaid program.

“For us, it makes total sense. I have been interested in seeing how quickly they have been moving,” he said.

In addition to a cash influx, the dis-enrollment freeze would allow AHCA’s Medicaid staff to be flexible, and move away from “dealing with burdens of eligibility processes,” Duran said.

He added that it also adds a “continuity of care” for families who are going to be dealing with financial issues related to COVID-19.

Duran also expressed concerns over the way Florida’s Republican-controlled Legislature has tried to put restrictions around the state’s Medicaid program in the past, like implementing work requirements and focusing on who exactly is eligible to enroll.

A push for Medicaid expansion

As more Floridians need access to healthcare, Democrats and advocacy groups have rallied behind the idea of expanding the eligibility for people to enroll.

In a letter this week, the Florida Policy Institute and 44 other organizations called on Gov. Ron DeSantis and state agencies to, among other things, expanding Medicaid to all adults with income up to 138% of the poverty level. More than 800,000 uninsured Floridians with low income are excluded from Medicaid coverage in Florida, they noted.

Florida Democratic Party Chair Terrie Rizzo has slammed Republicans for not considering Democrat-led bills that would expand Medicaid, and Democratic Senators like Gary Farmer, of Lighthouse Point, have asked that the state waive Medicaid eligibility requirements for all residents not currently insured.

Mayhew said AHCA has not considered the idea and deferred to the Legislature to create new Medicaid policy that would expand eligibility.

What has happened before?

In the last 20 years, the federal government has offered Medicaid rate enhancements three times. Once in 2000 during the recession, once in 2008 during the Great Recession and in 2020.

Justin Senior, CEO of the Safety Net Hospital Alliance of Florida, was working for AHCA during the 2008 recession, and noted that “it’s scary to watch your enrollment jump.”

The spike put pressure on other major state budget silos like education, but the state accepted a similar federal match rate increase, which helped. It’s not unusual for states to accept the increase and agree to put a hold on changing eligibility criteria, Senior said.

“I’m actually not aware of any state that turned it down,” he said. “That growth in the enrollment rate will cost so much money it will crowd out other initiatives. By providing the state some relief, it’s kind of a bailout to the states in a way.”

Mayhew said the 2008 recession has informed the agency on what kinds of increases in enrollment to expect.

“Typically in a downturn in the economy, there will inevitably be an increase in the number of individuals who will be currently eligible for Medicaid,” she said.

Sen. Gayle Harrell, who chairs the Senate Health Policy Committee, said the influx of enrollees will mimic what happened during the recession. $1.2 billion in federal dollars is “significant,” she said, and she “would be very surprised if we did not take advantage of that.”

Harrell, a Stuart Republican, said an increased match would be helpful so that more state dollars could be used toward other parts of the already-constrained budget. She is particularly worried about the decline in sales tax revenue, which makes up a significant part of the budget.

“I am afraid we are going to have to make some very tough decisions moving forward,” she said.

The flexibility waiver

Earlier in March, the Trump administration approved a waiver that allows Florida to sign up and pay doctors and hospitals through Medicaid.

Under the approval, the state’s Medicaid program can waive application fees, certain criminal background checks and other requirements for doctors who provide care to people on Medicaid, according to the approval letter. Florida’s Medicaid program can now waive certain rules, such as prior authorization requirements for care, certain hospital admission requirements and rules for residents who are transferred between nursing homes.

The waiver also allows hospitals, nursing homes and clinics that are forced to evacuate to an unlicensed facility to receive payment for the care they give at the unlicensed facility.

Florida was the first state to get the waiver approved.

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