FPI budget analysis highlights wins and setbacks in Florida health care

Unfinished budget negotiations in the legislature are pushing session past its scheduled adjournment on Friday, due to a mandatory 72-hour “cooling off” period before policy makers can vote on the proposed appropriations bills. 

Last week, the Florida Policy Institute (FPI) published a 56-page analysis on the House and Senate proposed FY 2022-23 budgets, as well as how they compare to Gov. Ron DeSantis’ proposed budget, which was announced in December 2021. The Senate’s proposed budget ($108.6 billion) is a 7% increase from the current fiscal year budget of $101.5 billion. The House proposed budget ($105.3 billion) is a 3.7% increase, while DeSantis’ proposal ($99.7 billion) is  a 2% decrease.

 

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FPI’s analysis found the state’s operating budget has increased significantly—approximately 17.6%—during FY 2020-2021 and FY 2021-2022. This is mainly due to an influx of federal funding in response to the pandemic. State agencies that are slated to benefit from these funds include the Agency for Health Care Administration (AHCA), the Department of Health, and the Department of Economic Opportunity. 

A large portion of the analysis focused on proposed health care spending. Both chambers’ proposals exceed the current year funding in the Health and Human Human Services budget ($44.5 billion). The House and Senate propose $47.1 billion and $47.8 billion, respectively, although the report states federal funding accounts for more than 70% of both chamber’s proposals. 

Most of this funding is slated for the Agency for Health Care Administration to support Medicaid services. FPI confirmed neither the House nor Senate proposed eligibility cuts for Medicaid services, but criticized both chambers’ $300 million proposed reimbursement cut for services provided by safety net hospitals. The House also proposes a $215.9 million reimbursement cut for all hospitals. The House aims to redirect state funds ($100 million) from this cut towards training future nurses. Both chamber’s proposals would instead rely on supplemental payment programs to support safety net programs. 

“Proposed hospital rate cuts underscore the ongoing challenges of unpredictable year-to-year funding to sustain sufficient hospital capacity to meet the needs of Medicaid beneficiaries as well as other under-served communities,” the analysis said. “If Florida lawmakers chose to expand the state’s Medicaid program, millions more in stable federal funding would support hospitals.”

Wage and salary increases for workers in various health care settings, such as hospitals, nursing homes, and Medicaid managed care prepaid salary plans, are included in both chamber proposals. The House proposes raising the minimum wage to $13 per hour, while the Senate proposes an increase to $15 per hour.

Another area of concern for FPI is funding for home and community-based services (HCBS). The Senate proposes $6 million to take about 500 people off the waitlist for the Alzheimer’s Disease Initiative (ADI), which provides respite and support services to individuals with Alzheimer’s disease and family caregivers. The Senate also proposes $4.9 million to take 539 people off the Community Care for the Elderly (CCE) program, which provides case management and other continuum care services for functionally impaired and at-risk seniors. 

The House proposal includes more funding than the Senate to take more people off both the ADI and CCE waitlists. The House also includes an additional $41.9 million to take about 798 people off the Agency for Person with Disabilities (APD) waiver waitlist, which provides medical, behavioral, and residential services to individuals with severe developmental disabilities. 

However, these funds only cover a fraction of the demand for HCBS. FPI reports there are currently 8,550 people on the ADI waitlist, 57,022 people on the CCE waitlist, and 22,759 people on the APD waitlist.

HCBS are set to receive additional support from a 10% increased federal matching percentage from the American Rescue Plan Act (ARPA) for one year. According to the analysis, Florida has received conditional federal approval for a $1 billion spending plan it submitted in 2021. 

Both chambers allocate funding for inmate health care services. The Senate and House propose about $568 million and $569 million, respectively.  Both are slightly more than the current year funding of $567 million.

However, FPI critiques the state’s general lack of progress on funding public assistance. According to the report, government spending per capita in Florida has consistently lagged behind neighboring states and the nation as a whole for the last decade. According to Census data from 2004-2019, Florida also consistently ranked at or near the bottom in expenses for public welfare (49th), elementary and secondary education (49th), and higher education (50th).

“Florida’s low ranking is problematic because general revenue helps finance education, health and human services, corrections, natural resource management, growth management, transportation projects, and general government operations,” the analysis said.