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Florida Planning to Lower Medicaid Costs

April 27, 2011
Plain English Version

Florida is passing laws that change its Medicaid program dramatically. The goal is to lower costs, manage care, and reduce waste and fraud.

The cost of Medicaid has gone from $9 billion in 1999 to $21 billion in 2010. That amount is about one-third of the state budget. The federal government pays half the cost.

The new program ends the practice of paying doctors for each service they perform. Medicaid recipients would join for-profit Health Maintenance Organizations (HMOs). Hospitals or doctors run them. The HMOs would manage long-term care of the elderly.

Florida legislators say this is the best way to control the cost of Medicaid.

The Florida law sets limits on services. This gives the state and HMOs the right to deny some benefits. However, the federal government has to give its permission.

Advocates have expressed concern that the proposed law will reduce health care for millions. Moreover, they say the most vulnerable – the disabled, the elderly and the chronically ill – are at risk.

The proposed law allows the state to make a set amount of money available for managed-care companies to serve Medicaid patients. People are worried that for-profit health care makes it difficult to care for the very ill.

Some Democrats say the program will not work. Giving the private sector $20 billion will not be good for patients or the taxpayer.

The New York Times


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