As state lawmakers prepare to determine the specifics of an $87 billion budget hospitals are ready for the annual fight over state funds.
But this year’s negotiations, already off to a slower start, are likely to also be tangled by lower revenue, higher Medicaid costs and the political fallout from the state’s worst school shooting, which continues to rattle the Florida Legislature.
A top Senate leader said Tuesday both chambers had agreed on allocation numbers for the overall components of the state’s budget, including $543.6 million more in health and human services, which includes five state agencies. But the big-picture numbers only start the messy process of negotiating how those dollars are spent.
Both the House and Senate had rolled out plans earlier this month that diverged on healthcare spending, primarily how to compensate hospitals for Medicaid care. The House plan would preserve additional Medicaid payments, known as automatic rate enhancements, to 28 hospitals that currently serve a larger percentage of Medicaid patients. But the Senate plan would redistribute the $265 million in additional inpatient funds to all of the state’s hospitals instead, decreasing the amount of money those 28 hospitals receive.
The Senate’s proposed shift would disproportionately affect some of South Florida’s largest institutions — including Miami’s Jackson Memorial and Broward Health, which would lose $59 million and $17 million, respectively, according to an analysis by the Safety Net Hospital Alliance of Florida. Tampa General would lose $14 million, and Nicklaus Children’s Hospital in Miami and Johns Hopkins All Children’s in St. Petersburg, which each see about 70 percent of patients covered by Medicaid, would lose $10.5 million and $5 million, respectively.
But major for-profit hospital chains would see their reimbursements rise under the redistributions: the Hospital Corporation of America, which operates nearly 50 hospitals in the state, could see its reimbursements rise more than $40 million. Baptist Health South Florida, a nonprofit group of hospitals, would also come out ahead, according to the Safety Net Hospital Alliance.
The budget proposals have remained stalled since they were both passed Feb. 8, waiting for legislators to name budget conferences to begin the negotiating process between both chambers. But the process of agreeing on the funds could prove to be messier this year than most.
The Legislature has committed to hundreds of millions in additional expenses to address the shooting at Marjory Stoneman Douglas High School in Parkland, where 17 people were gunned down two weeks ago. Legislators are still trying to determine how to balance spending in the overall budget with the Parkland package, which will funnel at least $400 million in initiatives for gun control, school safety and mental health. The state is also expecting about $167 million less in corporate taxes than previously estimated after revenue estimates were revised, and in healthcare, legislators have to also tangle with about $100 million more than expected in Medicaid costs from the previous year.
Those numbers could affect overall budget discussions and the pace at which legislators come to an agreement on spending as a whole.
“When you take $400 million and put it towards necessary efforts, that creates challenges in other areas of the budget,” said budget chair Sen. Rob Bradley, R-Fleming Island, when he announced the allocations agreement Tuesday. “We’re up to that challenge.”
But those discussions are unlikely to directly influence discussions about hospital funding, which largely deals with redistributing the same amount of money in one pool, said Lindy Kennedy, vice president of the Safety Net Alliance. “I don’t see it impacting it directly, as the two chambers line up their priorities.”
For the session to end on time, lawmakers must come to an agreement on the budget by March 6, providing for a three-day waiting period before it can officially be passed. The session is scheduled to end March 9.