Governor Scott Drops LIP Funding Lawsuit, Coverage Gap Remains

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The Supreme Court decision safeguarding tax credit subsidies for 1.3 million Floridians was not the only big legal development on for health care in Florida in the last week of June.  On Thursday June 25, Governor Scott withdrew his unfounded lawsuit against the Federal Department of Health and Human Services (HHS) that alleged unlawful coercion against the federal government over the Medicaid Low Income Pool (LIP) waiver. Florida CHAIN joined with the League of Women Voters of Florida and Florida Legal Services in a “friend of the court” filing supporting the discretionary authority of the Secretary of HHS to maintain or terminate trial projects demonstration authorized under the Medicaid demonstration waiver process.

Due to the failure in the Florida legislature of expanding Medicaid, despite the $1 billion LIP fund, there was still a shortage in the state budget to cover under and uncompensated health care in the state generated in a large part by the disastrous coverage gap.  To address this fiscal shortage, in the special session the Florida Legislature allocated $400,000 out of the general revenue fund to the Medicaid program.  Our state draws down $600,000 in matching Medicaid funds from the federal government under the existing Medicaid rule.  This second $1billion will be used to increase our Medicaid payment rates in 2016 to attempt to compensate health care providers in Florida for the ongoing high levels of care they deliver to the people who remain uninsured.

Had the legislature expanded Medicaid in 2016, they would have drawn down between $5 and $7 billion dollars in 2016 to pay for covering people with health insurance without spending out of the general revenue budget. This year, our legislature made a choice – to use the most expensive method to use new Florida tax dollars to pay for non-coverage of 800,000 Floridians in the coverage gap instead of drawing back our already paid federal tax dollars to Florida to pay for health care coverage.