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Governor’s Medicaid Boost Requires Federal Help

Health care advocates were pleased Friday to hear Gov. Charlie Crist recommend $2.7 billion in new spending to cover increased Medicaid costs, but the boost relies in part on getting additional money from Washington that some say is up in the air.

Crist and budget director Jerry McDaniel said administration officials are confident that a 27-month boost in the amount of health care money provided to the states by Washington – known as the Federal Medical Assistance Percentage, or FMAP – would be extended. The U.S. House has voted to continue the increase, but so far, the Senate has not.

Republicans aren't fully on board, and with the election of Massachusetts Sen. Scott Brown changing the political dynamic in Washington, some say an extension of the increase in federal health spending isn't a given.

“This is not settled at all," state House budget chairman David Rivera, R-Miami, said. "We don't know if we're ever going to see this money. Since Scott Brown was elected, everything is different."

But advocates for Medicaid patients said they generally agreed with the governor that Washington was likely to send the money, because members of Congress are being lobbied by officials in their states with several legislatures hoping to have the money to balance strapped health care budgets.

“Folks in Washington are saying that they understand that the states are facing this crunch,” said Karen Woodall, who has worked with the Florida Center for Fiscal and Economic Policy on Medicaid issues in Tallahassee. “I don't think (Crist's use of the money in the budget) is overly optimistic. I think that will happen – it's critical that that does happen.”

Advocates say it is crucial for the state to take the money, not just because of the help it provides in balancing the ledger for Medicaid, which serves nearly 3 million poor Floridians. It's critical, they say, because the stimulus money came with a condition – to use it the state would have to meet certain eligibility thresholds, a so-called “maintenance of effort” requirement that would force the state to fund certain Medicaid programs and levels of spending.

Some initiatives, like the state's Medically Needy program, which pays medical bills for certain families who don't typically qualify for Medicaid, or the Meds AD program, which provides pharmaceutical coverage to certain people, were scheduled to sunset in Florida this year – but would have to be restored if Florida gets and uses the federal FMAP increase. Taking the money would also prevent the state from lowering the number of pregnant women who can get their health care covered by Medicaid.

Banking on that, Crist is calling for restoring $402.7 million to the budget for Medically Needy, which would keep coverage going for 14,200 people for an additional six months. Crist's budget also calls for restoring the Meds AD program for 13,000 people for an additional six months, costing $267.5 million.

Crist's budget “is very good news,” Woodall said, acknowledging how important it is to get the extenstion of the FMAP passed in Washington.

“My sense is they (members of Congress) understand that,” Woodall said.

Rep. Denise Grimsley, a nurse and the state House's top health care budget writer as chairwoman of the House Health Care Appropriations Committee, said finding a way to pay for “optional” Medicaid programs makes sense anyway.

“Not funding something like Medically Needy or Meds AD would not really save any money in the long run,” said Grimsley, R-Lake Placid, who also characterized it as “an unknown” as to whether Florida will get enhanced FMAP money. “Those costs would still occur, they would just show up in a different area, such as increased inpatient services.”

If Washington doesn't come through, there's little doubt the Legislature wouldn't be able to hit the governor's targets on health care spending. Costs have grown enormously in health care, as Medicaid rolls have grown in the economic downturn, outpacing the moderate increase in incoming taxes that state economists are now forecasting.

“If the FMAP bump up isn't extended, there will be drastic cuts,” said Greg Mellowe, policy director for health care advocacy group Florida Chain. He said he was in DC this week where all the talk among health care advocates was what the status is of the FMAP extension in light of the election of Brown to the Senate, erasing a Democratic filibuster-proof majority in the Senate.

But, Mellowe said, “I'm optimistic – this is something they (in the Senate) realize we have to do.”

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