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.

Medicaid Expansion Would Reach Only Low-Income Floridians

In June, the U.S. Supreme Court June decision upheld the constitutionality of the Affordable Care Act (ACA) in full, but nevertheless held that states could not lose funding for their existing Medicaid programs if they rejected the ACA’s Medicaid expansion, which would extend coverage to more than a million of the lowest-income, uninsured Floridians. Since then, Florida Governor Rick Scott and other ACA opponents have argued that expansion is in fact unnecessary because the needs of low-income Floridians are already being met through Florida’s existing Medicaid program. The reality, however, is different.

> Read the report.

Rejecting Medicaid Expansion Not a Sensible Option for Florida

Although Florida's elected leaders may have the political option of rejecting Medicaid expansion under the Affordable Care Act, actually doing so would cause serious harm to the state and its economy.

Rejecting Medicaid expansion would cost Floridians $20 billion in unused federal dollars and tens of thousands of new jobs, while denying the lowest-income workers and families much-needed coverage.

> Read the report.

Florida Insurers Complying with Early ACA Provisions, But Future Benefit Threatened by State Inaction

Although a decision by the U.S. Supreme Court regarding the constitutionality of the Affordable Care Act is imminent, many provisions likely would remain in effect unless the court invalidates the entire ACA.

Contrary to the portrayal of the ACA by opponents as federally directed, state leaders and state agencies play the central role in configuring access to ACA benefits and protections.

Nevertheless, the law has been met with fierce and persistent opposition from Florida's elected and appointed leadership, and state-level efforts to implement the ACA have remained at a virtual standstill for more than a year and a half. This inaction and outright resistance raises a question of whether Floridians might face delayed or denied access to the intended benefits of the ACA's key reforms as they take effect during the next few years. On the more immediate front, it gives rise to questions about the extent to which Floridians have access to the limited but important ACA benefits that should already be available to them.

Despite the fact that Florida remains mired at "square one" in implementing the ACA, Florida insurers nevertheless appear to be generally compliant with the effective provisions of the ACA, and millions of Floridians are benefiting as a result.

These findings are cause for both confidence and concern among Florida consumers. While indications are that insurers have taken and will make some effort to comply with the law, the extent and level of compliance will be considerably lower and less continuous without strong transparency requirements and enforcement mechanisms by the state.

> Read the report.

Changes to Medically Needy Program Will Push Most Out of Coverage

The Medically Needy component of the Medicaid program provides short-term coverage to Floridians who are over income for regular Medicaid but have catastrophic medical expenses.

On April 26, the state requested federal permission to require, for the first time, that all Medically Needy participants enroll in a managed care plan and pay monthly premiums, purportedly to ensure their access to continuous coverage.  However, failure to pay those premiums, which could absorb up to 90 percent of a participant's household income, would end their eligibility for Medicaid altogether.

Virtually no Medically Needy participants would be able to afford the premiums, and the inevitable result would be loss of access to Medicaid and harm to hundreds of thousands of the most vulnerable Floridians.

> Read the report.

Good Corporate Citizens Can Renegotiate Deals That Hurt Schools, Taxpayers

Financial institutions with multimillion-dollar contracts with school districts and other public agencies – particularly banks bailed out from their losing speculative practices by federal tax money – should act as good corporate citizens and renegotiate one-sided contracts that impair the education of Florida’s children.

> Read the report about interest rate swaps.

Florida’s Tax System Highlighted On Federal Income Tax Day

The deadline for filing federal income tax returns serves as a reminder of a distinction Florida shares with only six other states: imposing no state personal income tax.

The absence of the tax is appreciated by most Floridians. But it has consequences on Florida's tax structure, affecting who pays for public services and whether the revenue generated by the tax system is adequate to meet state needs.

In summary, Florida is a low-tax state, rated the second-worst in the nation, inadequate to meet the need for public services, and worsened by subsidies and tax breaks to large, profitable corporations.  It would be made even worse by elimination of the corporate income tax.

Keeping that tax and modernizing the state's antiquated tax system would best serve Florida.

> Read the report.

Tax Breaks Continue Despite Revenue Shortfall

Even though the Florida Legislature faced a shortfall of revenue needed to continue paying for current services, it passed an assortment of tax cuts that will diminish state funds even more in the future. In addition, it provided other tax breaks to businesses, continued the expansion of the tax-financed private school voucher program, and appropriated more than $100 million for subsidies for businesses promising new jobs.

The reduction in funds through tax cuts and subsidies was accompanied by a $300 million cut to universities and hospitals and nursing homes, whose payments were cut for the fifth consecutive year. The dollars forgone through tax cuts could have been appropriated to lessen those and other budget cuts imposed by the legislature.

> Read the report.

Florida’s Claims About Medicaid Expansion Under ACA Are Inflated

With Florida's and other states' challenge of the Affordable Care Act scheduled for U.S. Supreme Court arguments next week, the argument that the law imposes a crushing financial burden on states invites examination.

The State of Florida's estimates of its costs resulting from the ACA are hyper-inflated, and they appear to have been specifically crafted to support a political position rather than provide a backdrop for planning purposes.

In  fact, the federal government will pay 100 percent of the costs of Medicaid expansion for three years and 90 percent or more every year of the first 10 years of the act.  Meanwhile, about 1 million Floridians previously without health insurance or saddled with inexpensive or inadequate insurance will be covered.  And by 2022-2023, Florida will have received an estimated $20.3 billion in additional federal Medicaid funding from the federal government.  Each dollar of Medicaid expansion-related state spending over the 10-year period will leverage an additional $9.51 in federal funding, directly stimulating the economy and increasing jobs.

> Read the report.

Legislature Advances Tax Breaks Despite Revenue Inadequate for Critical State Services

The Florida Legislature moved closer this week to enacting $125 million in special-interest tax breaks even as it finalizes a state budget balanced only by deep funding cuts for state universities, hospitals, and nursing homes.

In addition to the business tax cuts, the legislature is considering new direct appropriations for sporting events in the name of economic development: $1 million to the Central Florida Sports Commission "for securing the Major League Soccer combine and spring training" and another $1 million for the "World Class International Regatta Sports Center" in Sarasota.

Tax cuts and other giveaways reduce revenue available to meet critical state needs in public schools, colleges and universities, healthcare, and social services. Each dollar given away takes money away from those state responsibilities. They also add to the billions of dollars already lost each year through the hundreds of exemptions, exclusions, deductions, and credits in Florida's tax laws.

> Read the report.

Filling the Coverage Gap for Children in KidCare Is Appropriate and Affordable

> 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.