News Column

Gov. Rick Scott May Shift Stance on Health Reform Law

Nov. 11, 2012

John Dorschner

With the reelection of President Barack Obama, Florida's Republican leaders are reconsidering their fervent opposition to federal healthcare reform, triggering a discussion that could have huge repercussions for South Florida.

At stake is more than $6 billion in federal funding for Miami-Dade and Broward over the next decade and the possibility of health insurance for a large percentage of the 1.4 million people in the two counties who now lack coverage.

After the defeat of Mitt Romney, who vowed to halt Obama's healthcare overhaul, the Republican leaders of the Florida House and Senate quickly said the Legislature needed to reexamine the federal act. On Friday evening, Gov. Rick Scott said he agreed there needed to be a discussion.

"Just saying "no' is not an answer," Scott said in a statement that repeated exactly what Sen. Don Gaetz, R-Destin, the incoming Senate president, told The Miami Herald on Thursday.

"I don't like this law," Gaetz also said, "but this is the law, and I believe I have a constitutional obligation to carry it out." He added that he thinks "there needs to be some adult debate between Republicans and Democrats" on finding ways to make the law work.

Still, Gaetz, Scott and others in the Republican leadership, which controls both the Florida House and Senate, have many criticisms of what both parties now call "Obamacare." Some are searching for compromises on how it is carried out in the state. What this means for patients and the healthcare industry in Florida -- particularly South Florida -- remains an enormous question mark.

Time is running short for decisions as the once-distant consequences of the Affordable Care Act are scheduled to kick in during the next 14 months.

The first deadline is Friday. That's when states must tell Washington whether they plan to set up exchanges -- marketplaces where individuals can purchase insurance at discounted group rates and cannot be denied because of pre-existing conditions.

Florida's political leaders acknowledge they won't make the deadline. The exchanges are scheduled to start Jan. 1, 2014, and if a state doesn't set up an exchange, its residents can participate in a federal exchange.

The next provision starts Jan. 1 with an increase in Medicaid fees for primary care physicians. Primary care physicians, who have long complained about low rates for Medicaid, which provides coverage for the poor, are scheduled to be paid at considerably higher Medicare rates -- with the feds picking up all of the added cost. But such a pay hike can only happen with the approval of the governor and Legislature, and it's unclear whether that will happen.

The following year, on Jan. 1, 2014, the biggest changes are slated to start, including a major expansion of people covered by Medicaid. An analysis from the Safety Net Hospital Alliance of Florida shows that if the state doesn't expand coverage, Florida will lose $27.9 billion in federal funds over 10 years.

That breaks down to a $4.5 billion loss for Miami-Dade during that time, and a $2.3 billion loss for Broward, according to the alliance's analysis.

Under the law, Washington will pay all Medicaid expansion costs for the first three years, but then the states would have to pay up to 10 percent of the costs in following years -- an expense that the Safety Net Alliance calculates will come to $1.7 billion over 10 years in Florida. The expansion could provide coverage to an additional million-plus Floridians. Reform supporters say the expansion would provide cheaper basic care that would help prevent serious illnesses that lead to expensive hospital stays.

Gaetz said Florida can't meet Friday's deadline for submitting a plan for an exchange, but he said many states have dragged their feet on exchanges, waiting to see what happened in the election, and he thought Washington would be willing to accommodate late plans. On Friday, Washington proved him right, sending governors a letter offering states some flexibility in preparing the exchanges over the next several months.

Scott, former head of a national hospital chain, has been a strong critic of most government involvement in healthcare. Before the election, he said he was adamantly opposed to expanding Medicaid and to healthcare exchanges.

When The Herald asked the governor's press office Thursday whether he had changed his mind, spokeswoman Jackie Schutz first responded by emailing an Associated Press story from Wednesday headlined: "Fla. Gov. won't back down on healthcare law." The story said Scott believes the overhaul will be too expensive and would harm businesses by raising their costs.

On Friday, Schutz emailed that the governor had an additional comment, opening the door for discussion but offering no specifics. "We need to focus on how Obamacare affects each of our families," Scott said. "Will it increase the cost of healthcare for our families? Will it impact the quality of healthcare for our families?

"Will it impact Floridians' access to our healthcare system? I am looking forward to working with legislators and others on specific ways to address these issues. On Obamacare, I am concerned about how it affects patients, jobs and taxes on Floridians. The problem we need to address is why healthcare costs so much for our families," the governor said.

Gaetz said he'd like to explore compromises, such as a partial expansion of Medicaid that would be less than the federal act envisioned. He also suggested using an existing insurance framework like the Florida Healthy Kids program, which offers insurance to middle-class children, as the basis for a Florida exchange.

Gaetz said he remains concerned that expanding Medicaid will mean huge unforeseen costs in the future for Florida, if Washington pulls back on its Medicaid funding, as it has done in other state-federal partnerships in the past.

Incoming-House Speaker Will Weatherford, R-Wesley Chapel, also seems interested in finding a way to reconsider the state's response to healthcare reform. According to a Tampa Bay Times report, he favors the state setting up its own exchange. "We're not going to have a federal exchange, I can say that."

Floridians themselves have mixed feelings about healthcare reform. On Election Day, 51.5 percent of Florida voters rejected an attempt by the Republican Legislature to constitutionally prohibit any law requiring people to purchase health insurance -- a primary requirement in the reform act. In Miami-Dade, 55.4 percent voted no on the amendment. In Broward, it was 60.9 percent.

Even though the amendment didn't pass, Herald exit polling found that 47 percent of voters said they favored repealing some or all of the national healthcare reform law.

Meanwhile, virtually all Florida hospitals and many doctors' groups support healthcare reform as the way to reduce the number of uninsured patients burdening the system, with their costs passed on -- through higher rates -- to those who do have insurance. Census surveys from 2011 show that 3.9 million Floridians are uninsured.

If Florida's Medicaid program doesn't expand in 2014, hospitals stand to lose more than Medicaid funds. That's particularly true for Jackson Health System, which gets tens of millions of dollars in special federal payments to make up for caring for the uninsured.

The reform act provides for eliminating or scaling back such payments, as the number of uninsured is reduced. Bruce Siegel, president of the National Association of Public Hospitals and Health Systems, said government hospitals in some other states are facing similar problems and he's hoping the Obama administration will maintain uninsured funding for places like Jackson. "But it may still be a very bumpy road ahead."

Linda Quick, president of the South Florida Hospital and Healthcare Association, said that the nation's hospitals agreed to more than $150 billion in payments under Medicare over a decade during negotiations leading to the Affordable Care Act. They did so assuming they would make up for the loss with revenue from patients newly insured under the federal act. But if Florida doesn't expand Medicaid, the hospitals are unsure where that leaves them.

Steven Ullmann, a health policy expert at the University of Miami, said Medicare has required many tweaks over the years and he's certain that the 2,000-page Affordable Care Act will need modifications as it goes along. But political experts say that may not be possible with a Republican-controlled House of Representatives opposed to the reforms.

The most immediate challenge facing Florida is the Jan. 1 change so that Medicaid primary care doctors will get better rates of compensation. Many doctors have avoided taking Medicaid patients because of the low pay, and virtually all healthcare analysts, both liberal and conservative, believe that the best way to cut healthcare costs is to provide more primary care on the theory that early treatment will reduce expensive trips to emergency rooms.

The federal government will cover all the costs of the increased payments, but because Medicaid is a state-federal program, the state pays the doctors and then is reimbursed by Washington. That means the Legislature must approve the change.

Mobeen Rathore, president of the Florida Chapter of the American Academy of Pediatrics, said Florida doesn't have any choice because "the state has to follow the federal law."

Nan Rich, a former state senator from Broward and a Democrat, said that since the Legislature doesn't meet until next spring, the increased doctors' payments would have to be recommended by both the governor and legislative leaders, then approved by the Legislative Budget Commission.

"It's a no-brainer," Rich said. "That's our tax dollars. If we don't use them, they'll be going to other states."



Source: (c)2012 The Miami Herald. Distributed by MCT Information Services.


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