The Center Square – Declining revenues fostered by the postponement of nonessential medical procedures during the COVID-19 pandemic has some Florida hospitals facing the brunt of the coronavirus crisis pondering employee furloughs.
The Safety Net Hospital Alliance of Florida has warned Gov. Ron DeSantis that hospitals are running out of money and has joined other advocates in asking that up to $70 million of the $1.6 billion Florida will receive in increased Medicaid funds be earmarked to remedy hospital revenue shortfalls.
“Keep in mind hospitals are businesses, just like restaurants and cruise lines, and have seen marked reductions in revenue due to precipitous drops in non-COVID patient care and elective procedures,” Safety Net Hospital Alliance President Lindy Kennedy wrote in a letter to DeSantis, which also was addressed to Agency for Health Care Administration (AHCA) Secretary Mary Mayhew.
“We, too, are struggling to make difficult choices regarding staff furloughs, clinic operating hours, etc.,” Kennedy wrote.
The alliance represents public, teaching, children’s and regional perinatal intensive care hospitals, including Jackson Health System in Miami, Orlando Health, UF Health Jacksonville and UF Health Shands Hospital in Gainesville.
Jackson Health System employees were warned Friday of pending cuts and furloughs on the same day Sarasota’s Memorial Health Care System announced it was laying workers off after a $16 million revenue decline in March.
Florida accepted an additional $1.6 billion in Medicaid funding in March with the adoption of the federal Families First Coronavirus Response Act. The alliance said DeSantis should earmark between $51 million and $69 million of that money to remedy hospital revenue shortfalls.
The Families First Coronavirus Response Act raises the Federal Medical Assistance Percentage (FMAP), or match rate, of federal to state dollars to 6.2 percent, which equates to about $1.6 billion in new funding for Florida’s Medicaid program, according to Florida House estimates.
Florida’s $30 billion Medicaid budget and 17 managed care plans provide safety-net health programs for nearly 4.2 million low-income state residents. Its Children’s Health Insurance Program (CHIP), or KidCare, provides medical insurance for an additional 2.4 million Florida children who don’t qualify for Medicaid.
In addition to consenting to not restrict its Medicaid eligibility requirements to qualify for the federal funding boost, Florida also agreed to freeze providers’ rates and to not terminate anyone now covered under the program.
Under the CARES Act, hospitals also would get a 20 percent add-on payment for inpatient care for COVID-19 patients.
Kennedy said Florida Medicaid’s program also should adopt this, with Medicaid paying hospitals the additional 20 percent even when a COVID-19 test result is negative or delayed.
“The care delivery process is identical regardless of their final diagnosis,” Kennedy wrote.
The alliance told DeSantis that with the FMAP increased to 6.2 percent, about $93 million in state general-revenue money previously slated for inpatient hospital care could be available to help hospitals.
Kennedy said while hospitals are precluded from offering elective surgeries and other treatments that pay the bills, costs are increasing dramatically in providing care that complies with disease control protocols.
“These activities have significantly increased the cost of providing obstetric, newborn, and neonatal service,” she wrote. “Other than COVID-19-related patient care, obstetrics is the only care delivery line of business that has remained steady.”
As of Tuesday afternoon, the Florida Department of Health reported 14,504 cases of COVID-19 – including 296 deaths – and 1,893 hospitalizations.