Billions of dollars at stake as Florida prepares to pick Medicaid winners and losers

by | Jan 12, 2024

While lawmakers wrestle with accountability reforms, several of the state’s providers have been socked with massive fines from other states for Medicaid overcharges

Editor’s note: A previous version of this story incorrectly stated that Sentara Health faced a federal investigation for overcharging Medicaid. That is not the case. The story has been corrected to reflect that the Sentara investigation is related to alleged overcharges linked to the federally-backed Affordable Care Act and related programs in Virginia. We regret the error. 

Florida’s top healthcare regulators at the state’s Agency for Health Care Administration have their hands full as they sift through a long list of major decisions and policy changes expected to take place this year. The agency is already tasked with picking winners and losers in the Medicaid managed care system with billions of dollars on the line. But on Friday, the Live Healthy Act made more progress through the Florida Legislature, passing a key committee hurdle with the backing of Senate President Kathleen Passidomo. The bill could bring even more changes than are already on the way to the state’s massive healthcare system with a strategic overhaul of state healthcare regulations, policies and practices.

The Live Healthy Act introduces key reforms, such as the establishment of interstate compacts for healthcare professional licensure and new pathways for foreign-trained physicians to practice in Florida. This move not only broadens the pool of available healthcare professionals but also aims to enhance the quality of medical services in the state. The Act’s financial commitments, including substantial appropriations for Home and Community Based Services Waivers and teaching hospitals, signify a major investment in the state’s healthcare infrastructure.

Simultaneously, the Florida House of Representatives is attempted to address accountability issues in Medicaid managed care with a proposal of its own, HB 783. The proposed legislation mandates regular performance reporting by Medicaid managed care plans to AHCA, aiming to increase operational transparency and accountability. This initiative marks a significant step towards ensuring that Medicaid services are delivered effectively and responsibly.

Notably, these proposed reforms in Florida’s Medicaid system coincide with the state’s effort to reapportion its Medicaid Managed Care contracts, which are divided up into regions, each worth at least hundreds of millions in state reimbursements for each of the handful of chosen providers in each of the state’s regions. And while state Medicaid experts are pouring over applications from a wide range of providers to determine who will receive the contracts, several of those providers are carrying significant baggage.

The newest development involves Sentara Healthcare, operating under Sentara and Optima Health, after news broke that the company has been under investigation for the past several years. The case centers around allegations that a Sentara subsidiary made materially false statements that triggered the highest possible reimbursement rates under the Affordable Care Act. The company says it’s been transparent with federal investigators, who are probing payments worth an estimated $665 million that the feds say may have been unfairly pocketed by the company.

Sentara is not alone. Centene, another major provider serving Florida, recently agreed to a $25.89 million settlement with South Carolina over allegations of Medicaid overcharging is part of a broader pattern of legal issues faced by the company. That case, though, was just the tip of the iceberg. With settlements totaling nearly $1 billion across 18 states, Centene’s troubles highlight systemic issues in Medicaid managed care that underscore the importance of rigorous oversight to prevent financial malpractices.


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