2016-17 HHS Budget Is Best Viewed As a Series of Missed Opportunities

Unlike last year, the 2016 regular session of the Florida Legislature adjourned on time, with House and Senate agreeing on a budget for the upcoming year.

In 2015, the disagreement over whether or not to accept what would have been a 100 percent federally funded extension of health coverage to as many as 800,000 uninsured, very low-income Floridians pushed the 2015 session into overtime.  This year, however, Medicaid expansion and its potential benefit to Florida's businesses, families and taxpayers were barely discussed. Instead, House and Senate entered the budget negotiation process with similar proposals and the intent to avoid another impasse.

The result, the 2016–17 General Appropriations Act, includes some small but important efforts to address Floridians' unmet health care and human services (HHS) needs.  In the larger picture, however, the 2016–17 HHS budget is best viewed as a series of missed opportunities that will create additional unmet need, particularly given the record amount of available general revenue.

> Read the report.

Measured Growth in the Medicaid Budget and of Managed Care Plan Payment Rates Will Constrain Costs of Medicaid Expansion

In the most recent round of debate by the Florida Legislature over whether or not to extend coverage to hundreds of thousands of the lowest-income Floridians though the Medicaid program (or an alternative that meets the requirements of the Affordable Care Act), opponents invoked many familiar and long-debunked arguments. 

Perhaps the oldest and most often cited of these claims is the assertion that the current Medicaid program is "spiraling out of control" and "swallowing the state budget."  But expansion would reduce state general revenue spending for Medicaid in the short term and the primary components of future spending growth appear poised to remain well-constrained over time as well. 

Examination of the spending picture makes it clear that not only is Medicaid a manageable and sustainable component of the state budget, expansion as called for in the Affordable Care Act would do nothing to alter that reality.


>Read the report.

Health Care Expansion Problems Cited by Leaders Are of Their Own Making or Already Addressed

For the past several years, leadership in the Florida House of Representatives has repeatedly rejected the opportunity to extend health coverage to non-elderly, uninsured adults with family incomes up to 138 percent of the Federal Poverty Level through Medicaid or an alternative as provided under the Affordable Care Act (ACA). 

In attempting to justify its refusal, Florida House leaders in particular have ignored or selectively interpreted almost every relevant fact pertaining to expansion and its implications for Florida. 

Many of the problems they identify as primary exist as a direct result of or have already been addressed as a result of deliberate choices made by the legislature. The fact that these conscious decisions have created or addressed many of the issues cited as impediments to expansion serves to directly discredit opponents' arguments.

>Read the report.   

A Chronology of Key Events: Medicaid Managed Care, the Low Income Pool and Medicaid Expansion

Review of a timeline of actions taken by Florida's legislative leadership and governors over the past decade on Medicaid reveals how state leaders have inconsistently and selectively used information to simultaneously embrace and undermine the program (and the flexibility/funding provided at the federal level).

 A chronology of actions from 2005 to the present sheds light on the current legislative impasse and the refusal of the House of Representatives to consider the Senate proposal to create the Florida Health Insurance Affordability Exchange program (FHIX). 

>Read the report.

Big Tax Cuts May Pass Legislature

At the midpoint of the legislative session, the Florida Senate and the House of Representatives are stalemated over the issue of health care expansion under the Affordable Care Act and funding for the Low Income Pool (LIP).

Under current law the funding associated with the LIP will expire on July 1, 2015, leaving a $2 billion hole in the budget.  

One tax cut, on telephone and cable services, would be a $471 million hit to the state's revenue stream, but would have only a slight impact on individual Floridians and families -- an estimated annual savings of $40 per person and $160 per family.

The size of the proposed $471 million cut is put in context when compared to funding amounts for vital state programs. For example, it is larger than the total budget of the Voluntary Prekindergarten Program.  And it is 75 times larger than the proposed general revenue increase for Alzheimer's respite services for 167 seniors  and funding for an additional 406 seniors in the Community Care for the Elderly program.

The needs of the state suggest that now is not the time to pass $600 million to $800 million in tax cuts. 

>Read the report. 

Keeping and Modernizing the Corporate Income Tax Will Best Serve Florida

Governor Rick Scott and legislative leaders are moving forward with a plan to cut corporate income tax revenues again after previous cuts in his first term. Action on these bills comes amid a renewed pledge by Scott to end the tax entirely, as he first proposed when inaugurated in 2011.

Relatively few businesses in Florida pay the tax, a huge proportion of which are very profitable corporations.

Both reducing collections from the tax and eliminating it would have undesirable effects.  Both would reduce income available to meet Florida's needs.  Secondly, any reduction would further skew Florida's tax system, leaving others to assume a greater share of the responsibility for funding vital state services, making Florida's unfair tax system even more unfair.

Eliminating the tax would allow profitable corporations, many of them multistate and multinational, to escape paying for the benefits they receive from state-funded services. 

A better alternative would be to modernize and strengthen the corporate income tax to make sure that profitable corporations pay their fair share and that other taxpayers don't bear a disproportionate share of the cost of state services.

> Read the report.

Census Data Show Florida Struggling to Recover from Recession

Florida’s poverty rate remained unchanged in 2013, median household income remained lower than before the Great Recession,and the state’s percentage of residents without health insurance was third-highest in the nation, the U.S. Census Bureau reported this week. The data from the American Community

Survey and Current Population Survey paint a picture of Florida still poorer than it was five years previously, despite the ongoing economic recovery.

> Read the report.

The Condition of Florida, 2014

Florida is still recovering from the Great Recession. As expected in any recovery period, jobs are coming back, although too few to employ the same percentage of Floridians that had jobs before the recession.

State revenues are increasing now and are expected to climb each year into the foreseeable future. But policymakers have used much of that growth money to provide new tax breaks each legislative session instead of reinvesting in areas of the budget squeezed during the recession years.

Telling points: Florida ranks 49th in the nation in per capita state and local spending for education, but corrections is funded well enough to rank 23rd among the states. And the state ranks 43rd in a recent survey of quality of services for the elderly, disabled and their caregivers. The state ranks very low in other measures of well- being affected by state expenditures, as this report indicates.

> Read the report.

MAGI: The Other Change to Medicaid Eligibility and What It Means to Florida

Starting January 2014, Florida will begin using the concept of Modified Adjusted Gross Income (MAGI) when determining eligibility for its Medicaid and CHIP programs.

More than just a number, MAGI is a new method for counting and calculating income under the Affordable Care Act.

Specifically, MAGI will provide a basis for aligning, simplifying and streamlining eligibility across Medicaid, CHIP, and the Premium Tax Credits and Cost-Sharing Reductions available through the new Health Insurance Marketplace.

The "translation" between the current system and MAGI is not completely straightforward, however. In fact, as a result of the differences between the two systems, some Floridians who are Medicaid-eligible under current rules will become ineligible in 2014, even if nothing about their situation changes. On the other hand, some who are ineligible under current rules will be able to qualify once MAGI is implemented.

> Read the report.

Improving Fiscal Condition Allows Legislature to Address Previous Budget Cuts, Increase Tax Fairness

As legislative committees meet in preparation for the 2014 session that begins in March, lawmakers enjoy a much-improved state budget situation for their construction of a new state budget for the next fiscal year.

This fact provides legislators with the opportunity to take a fresh look at making investments in the future of Florida and assuring that the state's tax system is both fair and sufficient to meet state needs.

Now that the state is again showing a healthy balance of funds that are expected to recur and increase, a top priority should be investing again in the social infrastructure.

> Read the report.

State Estimates of Health Premiums Are Faulty, Misleading Consumers

Starting October 1, 2013, Floridians will be able to purchase private health insurance plans through the new Health Insurance Marketplace created through the federal health reform law.

On July 31, the state entity responsible for regulating health insurance policies released information titled "Individual Monthly Health Insurance Premiums Before and After PPACA."

Unfortunately, the information provides no credible comparison of the impact of health reform on rates.  Its continued use as a basis for official projections is likely to result in direct harm to consumers.

> Read the report.

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The Florida Center for Fiscal and Economic Policy
579 East Call Street
Tallahassee Florida 32301
Phone: 850-325-6480
Email: info@fcfep.org

The mission of the Florida Center for Fiscal and Economic Policy is to conduct independent research, develop new ideas, and advise policymakers on state fiscal and economic policy.  The Center pays particular attention to policy impacts on low- and moderate-income individuals, families and neighborhoods, workers, and small businesses.  The Center works to heighten public awareness of the need to adequately fund programs that improve opportunities, choices, quality of life outcomes, and the economic well-being of all Floridians.