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Health Policy Report Finds Florida Could Expand Medicaid, Save Money

As state officials consider how Florida will participate in the Federal Health Care overhaul, a new health policy report from Georgetown University’s Health Policy Institute finds Florida could expand its Medicaid rolls without any additional state spending.  “We believe Florida officials should take a very serious look at this option,” said Georgetown University Research Professor Joan Alker who is a principle investigator in the study.  “Our study found that the state can actually save money while insuring that in the neighborhood of one million Floridians can get the health coverage they desperately need.”

The report finds Florida would save an estimated $100 million annually by expanding the Medicaid rolls.  The study’s authors said the state would save money because the federal government would fully fund the first three years of the Medicaid expansion and because more insured citizens would result in less reliance on state-funded safety net programs.

“Even assuming other costs the state will face, there will be savings,” said Alker.  “Uninsured people today in Florida are getting some care, but  it’s primarily in the emergency room or it’s through other state funded programs like, for example, mental health programs. The state’s already paying for some care, but it’s not the most efficient or effective care. So if we can get people preventive and primary care to keep them out of the emergency rooms, the state will be able to cut back on some of their safety net programs and the federal government will pick up the cost of really better coverage,” she said.

Just last Friday, Florida officials missed a deadline to notify the federal government of whether or not the state intends to set up its own health exchange under the Patient Protection and Affordable Care Act.  Governor Rick Scott indicated in a letter to U.S. Health and Human Services Secretary Kathleen Sebelius last week that he needed more information and that Florida couldn’t make a decision on going forward with the healthcare exchanges until the state legislature convenes in March.

Even with a health insurance exchange, a failure to expand Medicaid would still leave between 800,000 and one million Floridians without health insurance according to the Georgetown University report.  “Right now, for parents, you have to have less than $4,000 a year of income to be eligible for Medicaid.  So this extension would go to parents and other adults.  Many of these folks are working part time or full time, but they simply are not offered coverage on their jobs and they certainly don’t earn enough to buy it,” said Alker.  “The irony is that if the state chooses not to do the Medicaid expansion, there’s no backup option and those folks slightly above them in income level will get these federal tax credits.  So you’ll see a big hole and the most vulnerable folks will fall into that hole with no coverage,” she said.

Florida’s Medicaid program currently covers about 3 million people at an annual cost of more than $21 billion.  The federal government covers about half that cost.