Feds: Florida can’t expand Medicaid statewide

Federal health officials told Florida lawmakers Thursday they can’t privatize Medicaid statewide for now, saying they need to see specific details of how the state plans to change the program, which provide health insurance to mostly low-income residents.

The Centers for Medicare and Medicaid Services sent a letter to Florida health officials saying the agency will work with the state to approve a waiver by June 30. However, the agency can’t approve expansion of the Florida’s current five-county pilot program because the Legislature hasn’t agreed on the changes that would be made if it went statewide. The current bill is stalled in the Senate.

The state currently spends about $20 billion annually on Medicaid, which covers nearly 3 million Floridians. About half of the funding comes from the federal government.

“We require a plan to review before the additional authority can be granted,” according to the letter first obtained by The Associated Press.

The Agency for Health Care Administration, which oversees Medicaid, did not immediately comment Thursday.

The federal denial doesn’t mean the Republican-controlled Legislature is at an impasse. If Florida lawmakers reach an agreement before they adjourn their annual session next week, federal officials said they will consider an amendment to expand the program if it addresses quality of care and transparency issues.

Both the Republican-controlled House and Senate agree on statewide expansion, but they have major differences. The Senate bill calls on the state to withdraw from Medicaid if CMS doesn’t approve the expansion in the future. House leaders have signaled they won’t agree to that.

The House proposal divides the state into eight managed care regions while the Senate has proposed 19. Managed care providers would bid for contracts to provide services within a region. Legislative leaders say changes are necessary because costs are expected to hit $28 billion in three years.

House Speaker Dean Cannon said there’s a good chance the Legislature will pass a bill acceptable to federal officials by the end of the session.

The state has been running a pilot program in Broward County, Duval County and three of its neighbors since 2006, hiring insurance companies to run the Medicaid program in those counties. The goal was to see if privatization would save the state money while improving services. It’s unclear if money has been saved and there have been widespread complaints from patients and doctors about service.

Doctors have dropped out of the program, complaining of red tape and that the insurers deny the tests and medicine they prescribe. Patients say they can’t get appointments with specialists and have lapses in care because they are being switched among plans.

Several providers also quit saying they couldn’t make enough money. Wellcare, Amerigroup, United Healthcare, Vista and Buena Vista all withdrew from Broward County.

Nearly half of the 200,000 patients enrolled in the pilot have been dropped from at least one plan. Many have been bounced between several plans, CMS officials said.

“That’s extremely disruptive,” CMS spokeswoman Mary Kahn said. “We would want the state to prevent that from happening by providing greater network stability.”

Federal officials said they also want to see solid data along with a way to track what services patients are being denied. There is currently no record of that, state health officials said.

Critics worry for-profit providers are scrimping on patient care and denying medical services to increase profits.

Greg Mellowe, policy director of the health care advocacy group Florida CHAIN, said the federal government’s complaints are not new, that they are the same problems the state has known about since the pilot program started.

“This seems to be another diplomatic reminder that Florida must first show that it has learned to walk, if in fact it can, before trying to run,” he said.