1. Florida Politics

PolitiFact: Bill Nelson says Rick Scott said no to $1 million to monitor health insurance rates

Published Jun. 17, 2013

Sen. Bill Nelson did not have high hopes when he pressured Gov. Rick Scott to veto an insurance regulation bill that Nelson said could harm consumers.

Nelson, a Democrat who used to be the state's insurance commissioner, asked Scott to veto SB 1842, which prevents state regulators from reviewing rate hikes for new plans in 2014 and 2015 as the federal health care law is implemented.

"Given the governor's recent decision to return $1 million in federal funding that would have helped the state cover the cost of overseeing insurance rates under the new health care law, and the fact that he has not even applied for another $5 million in federal funding that is available to help states control their insurance markets, I'm not holding my breath," he wrote in an op-ed column.

As Nelson predicted, Scott signed the bill.

In Nelson's view, Scott and Republican legislators are setting up the federal government to take the fall for increased rates. His column left us wondering whether Scott really rejected $1 million for overseeing insurance rate hikes.

The task blasted us back to 2011, when the novice politician took office on a tea party-infused platform against Obamacare and big government.

He and Republican leaders made a name for Florida by spurning million-dollar grants for the health care law despite having one of the highest uninsured populations and a $3.7 billion budget hole.

Among the grants Florida rejected: $8.3 million for a community health center, $4.2 million for moving long-term care patients out of nursing homes, $2.8 million for prevention of teen pregnancy and STDs, $1 million for insurance exchange planning grants and, yes, $1 million for beefing up reviews of insurance premium increases.

The health care law set aside $250 million over five years to help states beef up their scrutiny of rate hike requests. Under the law, any double-digit proposed rate increase by individual or small group market insurers must be closely examined "to make sure it is justified."

Florida intended to use its $1 million award to expand its rate review coverage to large group and out-of-state companies; create new premium filing requirements; hire more actuaries; and make it easier for consumers to search premium increase filings on the state insurance regulators' website.

The state got the money in August 2010, when Florida's governor was Charlie Crist. In an acceptance letter, Florida Insurance Commissioner Kevin McCarty wrote, "The Office looks forward to our collaboration with the Office of Consumer Information and Insurance Oversight as we move forward to use the grant funds to enhance the rate review process in Florida."

McCarty's next letter to Angoff on the subject on Feb. 1, 2011, after the November 2010 elections that saw Crist out of office and Scott in, contained two sentences: "I hereby rescind acceptance of the above-referenced $1 million rate review grant, which occurred in a letter to you dated September 15, 2010. No drawdown of any of the $1 million will occur."

What changed?

Let's start from the top — of the rejection letter's masthead.

McCarty's office is overseen by the Financial Services Commission, a four-person body comprised of the governor and Cabinet. The 2010 election kicked out moderate-to-liberal members Crist and Chief Financial Officer Alex Sink and ushered in Scott and three anti-Obama Republicans. McCarty, who took over for Nelson as commissioner in 2003, is appointed by the commission.

Asked if Scott rejected the grant or told McCarty to return it, both the governor's office and Office of Insurance Regulation sidestepped the question.

But former Scott spokesman Lane Wright told us back in 2011 that the governor's office had a hand in determining what grants to keep and what grants to reject.

"Some grants were not applied for and some grants applied for under the Crist administration were returned because they were meant specifically for the implementation of Obamacare," Wright wrote in an email.

Our ruling

Nelson said Scott returned "$1 million in federal funding that would have helped the state cover the cost of overseeing insurance rates under the new health care law."

It is undeniable that a grant for that purpose in that amount was sought, and a grant was returned. But the official who technically returned the money was the state's insurance commissioner, a political appointee who answers to Scott as part of his role on the Financial Services Commission. Still, he did so shortly after Scott took office and Scott's office claimed some amount of credit back in 2011. We rate the claim Mostly True.

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