Florida’s budget brings sigh of relief to Florida hospitals

by | Apr 29, 2021

After months of worry over a proposed $300 million plus in budget cuts from the State of Florida, it is with a sigh of relief, Florida’s hospitals start looking ahead to the future.

The Florida House and Senate announced this week that it would be fully funding Medicaid in its new budget.

Senate Bill 2500 or the General Appropriations Act is a balanced state budget for the upcoming fiscal year. It was finalized earlier this week and will come up for vote on Friday, April 30, the final day of the 2021 Regular Session of the Florida Legislature, where it is expected to pass and then head to the Governor’s Office.

“On behalf of the more than 200 hospitals and health systems that make up the Florida Hospital Association, I thank Governor Ron DeSantis, Senate President Wilton Simpson and House Speaker Chris Sprowls for their commitment to Florida’s health care future. Over the past year, Florida’s doctors, nurses and hospital staff have been on the front lines of the pandemic running toward the crisis caring for COVID patients and continuing to meet the needs of all other patients. With this commitment to maintain critical state funding for hospital services to some of our most vulnerable Floridians and as we hopefully emerge from this unprecedented pandemic, our healthcare heroes can continue to care for COVID and nonCOVID patients and to effectively serve the broader healthcare needs of their communities,” said the President and CEO of the Florida Hospital Association Mary Mayhew in a statement to The Capitolist.

Even with federal relief funding of $4 billion, Florida hospitals lost billions over the last year due to the onslaught of the COVID pandemic, according to Mayhew.

Despite these losses, Justin Senior, CEO of Safety Net Hospital Alliance of Florida, said federal funding “prevented a true medical catastrophe.” He said the CARES provider relief fund was “a lifeline, not a windfall” and that hospitals in the state lost much more in revenue than they received.

But when the Florida Senate unanimously passed its budget for the 2021-22 fiscal year at the beginning of April, Florida’s hospitals were facing significant cuts — primarily in cuts to hospital Medicaid funding.

Under the Senate budget, hospitals would have taken a proposed $251.2 million reduction to inpatient and outpatient base Medicaid rates, impacting all hospitals and an additional $77.3 million was eliminated from hospitals that treat large numbers of Medicaid patients.

Senate Health and Human Services Appropriations Chairman Aaron Bean (R-Fernandina Beach) described the budget as a “budget full of tough decisions,” but he had a “buy back list” and that extra money for hospitals was on that list.

Through the budget consolidation process with the Florida House, those dollars were restored.

Simpson following the budget agreement, said, “We are certainly in a better place today than when we started our budget planning last summer. Revenue estimates have continued to improve, as have actual month-to-month collections, providing opportunities to offset the significant reductions that we thought would be necessary back in August when we were looking at a $5.4 billion revenue loss.”

Chair of the Senate Committee on Appropriations Senator Kelli Stargel (R-District 22) said, “Through a combination of key investments and significant reserves, this budget sets Florida on a responsible path towards a full economic recovery that will leave our state well-prepared to both address potential future challenges and seize upcoming opportunities as more and more people locate here in our great state.

“This budget ensures we live within our means and fund the ongoing, key functions of government with recurring state funds. We appropriate resources to fully fund the Medicaid program, which as a result of the pandemic has over one million additional enrollees for a caseload of 4.7 million Floridians. This comes at an increased cost to the state of more than $1.2 billion. We also fully fund the KidCare program serving 229,000 children with high quality health insurance.”

Sprowls promised in March he would make maternal healthcare a priority and announced a plan to extend the period of Medicaid eligibility for new mothers from 60 days to one year.

“Healthy moms are better positioned to raise healthy and thriving children,” Sprowls said at a March press conference.

However, during budget negotiations, the House and Senate briefly bickered over the program’s cost — nearly $90 million in state money, and roughly $150 million in federal dollars.

In the end, Sprowls was able to keep his promise, as long as DeSantis does not veto the Medicaid extension. It will become Florida law July 1.

According to the Florida Senate President’s office, the entire 2021 General Appropriations Act totals $101.5 billion, leaving $6 billion in state reserves, not including federal stimulus funds. The budget accounts for $6.7 billion of the $10 billion in anticipated non-recurring federal pandemic relief funds, the remainder of which will further bolster state reserves.


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