Florida Health News

Advocates say AHCA inflated Medicaid reform savings

By Christine Jordan Sexton
7/25/2008 © Florida Health News

TALLAHASSEE -- The state Agency for Health Care Administration has inflated the savings from Medicaid's pilot project in order to get a groundswell of support to expand it statewide, according to a report released Friday by an advocacy group. Florida CHAIN claims the money saved in the five-county pilot is about 4 percent per person, not the 20 percent that AHCA claimed in its most recent quarterly report.

An AHCA spokesman said agency officials would not comment on CHAIN's assertions until they had a chance to review the report. 

When federal authorities agreed to let Florida depart from the usual rules of Medicaid to run the experiment, they said the state had to keep the cost of the pilot project "budget neutral," meaning the state could not spend more than it would have if the traditional Medicaid program remained in place. Recent reports from AHCA detail how much less the state is spending in Broward, Duval, Nassau, Baker and Clay counties than it would have under the traditional Medicaid program.

But the CHAIN report says the savings calculation is based on faulty numbers. They cite a January 2008 report from the U.S. Government Accountability Office, the non-partisan auditing arm of Congress, that said federal spending projections for Florida's Medicaid program had been set artificially high at the time the pilot project was approved. As a result, GAO said, the state had permission to spend nearly $7 billion more was justified.
While the issue may sound bureaucratic, CHAIN Executive Director Laura Goodhue said it is imperative that accurate information about the program be disseminated.  “We certainly want to use the right data because this is an experiment the whole country is looking at,” she said. 

The report from CHAIN (short for Community Health Action Information Network) is the second to appear within 24 hours that raise questions about the finances surrounding Florida's attempt to modernize the way health services are provided to low-income families and the disabled. On Thursday, Georgetown University's Health Policy Institute reported on problems in the "Enhanced Benefits" part of the pilot.

The James Madison Institute issued a report last week saying that Medicaid reform reduced total costs for patients in the pilot counties by 7.2 percent from the previous year and about 14 percent less than what it would have cost had Medicaid reform not been implemented. The report also said that under Medicaid reform patients had increased access to specialists, 100 new services and reduced out-of-pocket costs.

But JMI’s report was based on the same AHCA reports that Florida CHAIN is now questioning. The JMI report was issued as the news of AHCA Inspector General Linda Keen’s resignation became public. Keen was the author of yet another analysis of Medicaid reform, which raised concerns that led Gov. Charlie Crist to oppose any expansion of Medicaid reform into additional counties. Keen's report stated that there wasn't enough money and staff to properly implement the pilot project and that problems that occurred in the traditional Medicaid program, such as access to specialists, remained a problem in the pilot program counties. The report also stated that there were problems in getting accurate and timely information to patients about their medical options and drug choices.

Florida’s Medicaid Reform pilot was passed in 2005, launched in Broward and Duval counties in 2006, and expanded into Baker, Clay, and Nassau counties in 2007. It requires virtually all Medicaid beneficiaries who aren’t in institutions to enroll in an HMO or other managed-care network. If they don’t choose one for themselves, they’re automatically assigned to one.

The idea behind Florida’s Medicaid reform project is to empower patients by allowing them the same choices privately insured people enjoy, such as choice of health plans and incentives for healthy choices. 

Tallahassee Correspondent Christine Jordan Sexton can be reached at cjordonsexton@hotmail.com.