UF Health hospitals may need to return $30 million to feds


Published: Wednesday, July 16, 2014 at 5:38 p.m.
Last Modified: Wednesday, July 16, 2014 at 5:38 p.m.

UF Health’s hospitals in Gainesville and Jacksonville might have to return more than $30 million in Medicaid money after the federal government says Florida hospitals were overpaid for years through a program to help cover the costs of caring for the uninsured poor.

The Centers for Medicare and Medicaid Services say an audit shows that, over an eight-year period, the state's safety net hospitals received $267 million more than they were due through the Medicaid Low Income Pool. The federal government wants all of the money repaid in one year.

Shands officials released this statement on the situation:

"The federal government's request asking Florida hospitals to pay back a portion of low-income pool funding will have a multimillion-dollar impact on UF Health in Gainesville and Jacksonville. Though UF Health does not believe it received excess funding, the two campuses combined may be asked to refund more than $30 million sent to us in previous years to help needy patients.

"As safety-net hospitals, we rely on federal and state funding to help offset the expenses associated with helping those with little or no resources, and asking us to pay back money already spent will make that task even more challenging. Our hope is that federal officials will reconsider this decision.

"At the same time, we again urge state legislators to help the citizens of Florida by reconsidering their decision not to expand Medicaid. The federal government has offered to pay all costs associated with expansion for several years, which would bring $50 billion over 10 years into the state while also helping millions of Floridians who are currently uninsured. Our belief is that Medicaid expansion would greatly benefit the health of Floridians and economy of our state."

The federal government is working to phase out the Low Income Pool program with the implementation of the Affordable Care Act, which is supposed to increase the availability of health care coverage to the uninsured through tax subsidies and a Medicaid expansion.

In Florida, however, lawmakers rejected the Medicaid expansion. There is now a coverage gap for people who make too much to qualify for Medicaid but not enough to afford private health insurance. For safety net hospitals, that means uninsured individuals might continue to rely on the emergency room for care.

Florida typically has received $1 billion annually through the Low Income Pool. This year, in a one-year funding extension, the state is receiving about $2.16 billion, said Florida Hospital Association President Bruce Rueben, but that includes funding for ongoing programs that were not previously paid for through the Low Income Pool.

While the White House and Florida lawmakers have been at odds over the rejected Medicaid expansion — the Obama administration released a report in early July saying the move would cost the state 63,000 jobs — Rueben said he does not see politics or retribution at play in the federal request for repayment. Audits to review the amount of money spent on programs and requests for reimbursement are routine, he said.

At the same time, he questioned whether the $267 million figure was accurate and noted it was not yet a final number.

Rueben said the situation does draw attention to the financial issues safety net hospitals face caring for the uninsured. He said he feels the Medicaid expansion could have provided those hospitals some relief instead of the state continuing to rely on the Low Income Pool program the federal government plans to phase out.

"What they're telling Florida is we're not going to pay hospitals more for uncompensated care because we have given you a way to eliminate uncompensated care through the Affordable Care Act … That's how the programs affect one another," Rueben said. "It's just a change in policy, and in Florida, we're going to have to figure out how to deal with it."

The Medicaid expansion increased the income threshold to qualify for the program to 133 percent of the federal poverty level with the federal government picking up all of the costs for three years. By year 10, the federal government would pay 90 percent of the costs and the state 10 percent. In rejecting the expansion, some skeptical state lawmakers said they felt Medicaid was an inefficient program and questioned if the federal government would follow through long term on its pledge to cover the bulk of the costs.

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