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The 2010 Florida
Legislature is in session, and Medicaid funding issues are a
major focus.
The Medicaid program is jointly funded by state and federal
governments to provide health care for low-income and needy
citizens. While Medicaid makes up about 26 percent of Florida’s
budget at $17.9 billion, unfortunately, Medicaid reimbursements
have not covered the costs of services for several years. The
major economic downturn of the past few years has created even
more of a struggle for our lawmakers as they work to balance the
state’s budget while facing a $3 billion General Revenue
shortfall for all programs.
Right now, funding for Medicaid looks quite grim. Our lawmakers
are working on a budget that includes only six months of the
enhanced Federal Medical Assistance Percentage, or FMAP, which
is set to expire in December.
FMAP is the federal government’s share of Medicaid. It works
like this: states put up a certain dollar amount, and the
federal government uses a specific formula to determine how much
it will match each state’s Medicaid program. States receive
varying percentages of the federal match based on these complex
formulas. The enhanced FMAP, which was part of the federal
stimulus package, provides states with a larger percentage to
help them get through the economic downfall without sacrificing
necessary services in the Medicaid program.
If the enhanced FMAP is not extended for the remaining six
months in this upcoming Florida budget year, Florida could lose
$1 billion in federal funds for Medicaid, meaning the state may
have to start cutting some vital programs.
Extension of the enhanced FMAP has great support in Washington,
D.C., and is likely to be approved by Congress, possibly this
month. Since the extension has not yet been approved, our
Legislature is preparing the budget based on smaller federal
support for Medicaid.
It is essential that federal dollars be used for the intended
purpose since the state barely funds hospital-related Medicaid.
In fact, in the current year’s budget, the state only puts up
5.6 cents on the dollar from General Revenue for
hospital-related Medicaid. The rest of the dollars come from the
state tax on hospitals and from public hospitals and health
systems, like ours, which provide even more funding through
Intergovernmental Transfers to help the state match the federal
dollars.
Medicaid dollars are especially vital for our community and our
health system. Less than 25 percent of Lee Memorial Health
System’s patients have private insurance. That is a 10
percentage point reduction in the past three years, due to our
rapid rise from less than three percent unemployed to over 14
percent and our overall lagging economy. The rest of our
patients receive Medicare and Medicaid or are uninsured. What is
more, Medicaid currently only covers 86 percent of what it costs
our hospitals to provide services.
We are encouraging our legislators to restore full funding to
the Medicaid budget as soon as the FMAP extension is passed in
Washington, D.C. Lee Memorial Health System Leadership, as well
as the Florida Hospital Association and the Safety Net Hospital
Alliance of Florida, is encouraging lawmakers to protect
Medicaid expenditures and not divert these Medicaid-intended
funds for other state budget uses.
Any loss of funds will have profound and far-reaching effects
for our community.
Peace,
Jim Nathan
President, Lee Memorial Health System
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