State Health Agency Corrects Inflated Costs of Obamacare Scott Had Used to Oppose Reform

With Gov. Rick Scott facing accusations of using inflated numbers, the Florida Agency for Health Care Administration late Wednesday released a report that slashes the state’s estimated costs for carrying out key parts of the federal Affordable Care Act.

The report indicates Florida’s costs could be as low as $3 billion over 10 years — a huge drop from the nearly $26 billion figure that AHCA produced in a report last month. Scott, a longtime critic of the federal law better known as Obamacare, has repeatedly used the $26 billion figure to express concerns about the state moving forward with an expansion of Medicaid eligibility.

The revisions came after state budget analysts, including the top staff member on the House Health Care Appropriations Subcommittee, raised questions about the assumptions that AHCA had used in the earlier report.

But even with the changes, it appears that the Scott administration believes that the state’s final tab over 10 years would be higher than the numbers released Wednesday.

For example, the earlier report disregarded part of the Affordable Care Act that says Washington will pay 100 percent of the costs of expanding Medicaid eligibility during the first three years and 90 percent of the costs later. Instead, the agency relied on far-lower estimates of federal spending on the expansion — spending that is known in the health care world as a “matching rate.”

The new numbers released Wednesday use the 100 percent and 90 percent figures. But as a hint of the administration’s skepticism, AHCA said those estimates “assume that the federal government will provide 100 percent to 90 percent match for the new population in Medicaid in perpetuity, which reflects a substantial and unending commitment from the federal government.”

Scott and AHCA have been under fire since the online publication Health News Florida reported about emails that showed state budget analysts thought the agency’s estimates last month were flawed.

Earlier Wednesday night, House Appropriations Chairman Seth McKeel, R-Lakeland, issued a statement that addressed the amount of money the federal government would provide for a Medicaid eligibility expansion. McKeel acknowledged that the federal government has in the past provided far less matching money than the 90 percent and 100 percent totals included in the Affordable Care Act, but he also indicated the state cannot ignore the law.

“However, unless there is unanimous consent to do otherwise, we must follow our process which requires estimates based on current law and practice,” McKeel said. “This is critical to the integrity of our budgeting process.”

Scott and other Florida Republican leaders fought the Affordable Care Act legally and politically for more than two years after it was approved by President Obama and congressional Democrats. But they are now pondering how to carry it out, after the U.S. Supreme Court in June upheld most of the law — and Obama was elected in November to a second term.

Lawmakers and Scott face major decisions in the coming months about whether to expand Medicaid eligibility and whether to take part in running a health-insurance exchange, which is a type of online marketplace where people could shop for coverage. Expanding Medicaid and creating exchanges in each state are important parts of Obama’s effort to dramatically decrease the number of uninsured Americans.

The report released last month suggested that expanding Medicaid eligibility and making other Medicaid changes in Florida would cost about $63 billion over 10 years, with the state picking up nearly $26 billion of the cost. Wednesday’s numbers showed an overall total of $29.6 billion, with the state paying as little as $3 billion, though an appendix to the report also includes some scenarios that could bump up the state’s share by what appears to be $2 billion or more.

Along with the issue about the federal matching rate, other changes in the revised numbers include eliminating estimated state spending on increased Medicaid payments to primary-care physicians.

The Affordable Care Act requires increased physician payment rates in 2013 and 2014, with the federal government paying the entire cost. In the report released last month, AHCA included figures for the state picking up part of the cost in later years.

–Margie Menzel, News Service of Florida