Florida Governor Signs Bill To Shift Some State Medicaid Beneficiaries to Managed Care
Florida Gov. Jeb Bush (R) on Friday signed into law legislation that will create a pilot program to shift some of the state's Medicaid beneficiaries to managed care plans and cap spending growth on the program at 8% for the next five years, the Sarasota Herald-Tribune reports.
The plan, approved by the state Legislature during a special session last week, will begin July 1, 2006, in Duval and Broward counties. About 210,000 beneficiaries in the two counties will be moved to managed care plans by June 2007. The other changes will take effect after Bush's term ends in January 2007 (Dunkelberger, Sarasota Herald-Tribune, 12/17).
Under the new system, the state will pay HMOs higher rates for treating sicker beneficiaries than for treating healthy beneficiaries. Beneficiaries will chose a state-approved managed care plan, with the state automatically enrolling beneficiaries who do not chose a plan (Hollis, Orlando Sentinel, 12/17).
Bush said the current $16 billion Medicaid budget makes up 25% of the state budget, and that rising costs would increase Medicaid spending to 60% of the state budget by 2015 without reforms.
Bush said, "I am absolutely confident that this reform will yield better health care results for Florida's most vulnerable citizens and create more predictability in management of our costs" (Farrington, AP/Bradenton Herald, 12/17).
Alan Levine, secretary of the Agency for Health Care Administration, said, "Those who want to defend the current system are defending the indefensible. The outcomes in the current system are poor" (Sarasota Herald-Tribune, 12/17).
Ron Pollack, executive directors of Families USA, said, "People who need health care the most, those with serious health conditions, with illnesses and disabilities, are going to be potentially harmed in a very significant way by this proposal" (Orlando Sentinel, 12/17).
Karen Woodall, a representative of a coalition of advocacy groups opposing the plan, said, "Everybody in the Medicaid system is going to be hurt by this because Florida had now agreed to a cap on our federal dollars, which means there will [be] limits that have never been placed on what can be spent in the Medicaid program" (AP/Bradenton Herald, 12/17).
"[C]onsumer choice and competition," are the "hallmarks" of the Florida plan, according to a Wall Street Journal editorial. The "risk-adjusted premiums" included in the plan provide an "innovative answer" to "critics who argue that competition won't work for the sick and disabled," the editorial states.
In addition, a provision of the plan that will deposit money into health savings accounts for beneficiaries who follow their doctors' recommendations will create a "financial cushion" to "help participants shift to the private health care sector, if they return to work," the editorial adds. The editorial also expresses support for "a feature allowing recipients with jobs to use their state-funded premiums to buy employer-provider health insurance if they prefer."
The editorial concludes that "[s]tate innovation is the way welfare reform began, and we're glad to see it now happening on Medicaid" (Wall Street Journal, 12/20).