Florida pushing new fees for most Medicaid recipients

Kaiser Health NewsMay 17, 2011 

Florida wants to be the first state in the nation to charge most of its Medicaid recipients a monthly premium as well as $100 for using the ER for routine care. But even supporters acknowledge that the new fees, which the state legislature passed recently as part of a sweeping Medicaid measure, face long odds of getting federal approval.

Today, four states — Illinois, Rhode Island, Vermont and Wisconsin — have Medicaid premiums. But those fees, in accordance with federal law, apply only to people who make more than 150 percent of the federal poverty level — $16,335 annually for an individual or $33,525 for a family of four.

Florida, however, wants to impose the $10 monthly premium on all Medicaid enrollees who aren't in nursing homes. At least two-thirds of Medicaid recipients in Florida, and in the U.S. as a whole, have incomes of less than 150 percent of the poverty level, according to the Kaiser Family Foundation. (Kaiser Health News is a program of the foundation.)

About a dozen states charge Medicaid co-pays for routine care in emergency rooms, but none has fees higher than $20 for people who earn less than the poverty level. Seven of these states charge the fee only for recipients who make above 150 percent of the poverty level.

Consumer advocates want the Obama administration to reject both Florida measures because, they say, they'll make it harder for people to get Medicaid benefits.

Florida lawmakers who supported the changes say they'd make Medicaid, the state-federal health insurance program for the poor, more like private insurance and deter the unnecessary use of hospital emergency rooms.

Republican state Rep. Matt Hudson, the chairman of the Florida House of Representatives Appropriations Health Care Subcommittee, said the new fees would make "people personally responsible for their own health." He added: "This is not a budgetary decision; it's a philosophic stand. Everyone else in society is paying a portion of their own health care, including the military and retirees, so why shouldn't this segment of the population?"

Diane Leone, a spokeswoman for the Tea Party Network of Florida, said she supported the changes because the state faced a major budget deficit. "A hundred dollars is a lot of money, but if we keep clogging our ERs with folks who are there for non-emergency reasons, then that is a problem that can cost lives," she said.

Hudson said he expected the Obama administration either to block the measures or approve them with the caveat that neither could stop Medicaid enrollees from getting care or coverage, which would nullify their impact.

While federal health officials have said they want to give states flexibility in running their Medicaid programs, the new premium could violate the 2010 health care law, which bars states from making it more difficult for people to enroll in Medicaid, according to guidance from the U.S. Health and Human Services Department. That guidance said states could raise premiums to keep up with inflation, but couldn't enact new premiums for groups they already covered.

The federal government hasn't yet evaluated the measure, which Gov. Rick Scott is expected to sign.

Florida's ER co-pay, which it's estimated would generate about $9 million a year, was aimed at Medicaid recipients who use the ER for primary care even though it's cheaper to use a doctor's office or clinic. National studies have shown that Medicaid enrollees use the ER about three times as much as people who have private insurance do.

There's no official estimate of how much revenue the $10 premium would generate. But if 2 million of Florida's 3 million Medicaid recipients paid the fee, it would bring in $240 million annually.

Physicians and advocates for the poor criticized the proposed fees.

"The ER $100 fee could simply put lives at risk," Laura Goodhue, the executive director of Florida CHAIN, a patient advocacy group. "You can imagine a host of examples, such as chest pains, false labor, children having problems breathing, where a very low-income person would have to make the decision not to go to the ER or risk being fined $100."

Dr. Peter Viccellio, the vice chair of emergency medicine at SUNY-Stony Brook Medical Center on Long Island and a spokesman for the American College of Emergency Physicians, said Medicaid recipients used the ER more than privately insured individuals did because they were sicker and had fewer doctors willing to see them.

"When you add a co-pay, you obstruct access to care for both emergency and non-emergency care," he said. "This is not a way to save money, it's a way to punish people for being poor."

Peter Cunningham, a senior fellow at the Center for Studying Health System Change, said an ER fee would reduce ER usage for both true emergencies and routine health needs. He said a better answer to curtailing unnecessary ER use would be to develop more alternative health services that were open nights and weekends for people on Medicaid.

(Kaiser Health News is an editorially independent news service of the Kaiser Family Foundation, a nonpartisan health care policy organization that isn't affiliated with Kaiser Permanente.)

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