Florida Medicaid reform could become the national template

Florida Gov. Jeb Bush has unveiled a Medicaid privatization program that some observers say could become a template for Republican members of Congress who want to make substantive changes to the health insurance program. Mr. Bush said his Empowered Care program will ensure that Florida’s most vulnerable families continue to receive the quality health care they need while directing their own health care. The reforms also would bring predictability to state spending on Florida’s $14 billion Medicaid program, he said.

"To fulfill our commitment to Florida’s Medicaid program, we must transform it completely so that the No. 1 priority is patient well-being and the last consideration is government control," the governor said.

"Our proposals put the focus back on the patient by encouraging strong patient-doctor relationships and allowing competition in the market to drive access and quality of care up from current levels in the Medicaid system. Florida’s Medicaid system will collapse under its own weight if we do not fundamentally transform the way it operates. The changes we’re proposing will help create more predictable and sustainable growth in Medicaid costs and ensure the program meets the needs of Floridians who rely on it for health care," he added.

Major components

State information describes the major components of the proposal this way:

• Empower Medicaid participants to make choices about their own care. Health care providers will create benefit packages in combinations of three components — basic care, catastrophic care, and flexible spending. Participants will be helped by counselors to choose the program that best meets their needs.

• Medicaid participants can build a "bridge to independence" by opting out of Medicaid plans and using their state-paid premium to purchase private market insurance.

• Participants will be able to use a new feature of the benefit structure that encourages healthy practices and responsible lifestyle choices by giving them the ability to earn enhanced benefits through flexible spending accounts. The enhanced benefits will provide extra funds to buy increased coverage or services through their care plan.

• Providers will have greater flexibility in designing service plans. In addition to basic, catastrophic care, and flexible spending services, providers will be free to compete for participant membership by offering innovative care, convenient networks, and optional services. Participants will not be limited to HMOs and insurance plans. Options like provider service networks and innovative community-based systems will be available to meet the unique needs of participants.

• Basic or catastrophic plan participants will have access to all types of mandatory health services, including professional care, hospitalizations, and diagnostic services.

• Instead of the state setting the amount or scope of services, competing vendors will be allowed to offer different packages that may appeal to different customers. The state will continue to allocate the premium to each of the three categories based on historic spending patterns.

Questions, not criticism

Florida observers report the governor’s proposal was greeted more with questions than with outright criticism. Democratic lawmakers and advocates for Medicaid recipients expressed concern that benefits for the poor not become more limited than they already are.

"While market forces can be a positive force for good, we are concerned about how the proposals we have seen can, or will, harness those forces to protect the people who have previously been shut out of the health and long-term care market," said Kathy Marma of Florida’s AARP chapter. "Will service packages offered under the new system be meaningful and cover the needs of persons with chronic conditions and special needs that the private market has chosen not to cover?" she asked.

And ARC of Florida executive director John Hall told local media state paid premium rates could be too low to cover people with disabilities adequately since premiums would be based on historic funding as well as an individual’s level of health risk. "It’s unrealistic that somehow he’s going to be able to put together a package for persons with disabilities based on current funding levels that are inadequate, and it will result in better outcomes," Mr. Hall cautioned.

(For state information on the proposal, go to www.empoweredcare.com.)