Lawmakers have questions after Florida hospitals earned $6 billion in 2020 despite pandemic
Florida hospital executives said 2020 would be a challenging year. According to a state agency, it wasn’t so challenging for their bottom line.
This week, lawmakers from both parties grilled top healthcare executives over hundreds of millions of dollars in taxpayer-funded services at their facilities. While the lawmakers asked their questions, they broadcast an image of a graphic that was produced by the Agency for Health Care Administration and showed Florida hospitals made nearly $6.3 billion in 2020 — amid the coronavirus pandemic.
One top Republican said it was time for hospitals to acknowledge that their institutions are overwhelmingly profitable.
“This is a partnership between the hospitals, the nursing homes and the state of Florida. In a partnership, it can’t be onesided,” said Rep. Bryan Avila, R-Hialeah. “When you have one entity or multiple entities constantly saying that this is going to be the year where they shut the doors, or a budget proposal is a gut-punch, those things are not helpful to the process.”
Avila addressed his comments to Mary Mayhew, president and CEO of the Florida Hospital Association; Justin Senior, CEO of the Safety Net Hospital Alliance of Florida; Emmett Reed, CEO of the Florida Health Care Association, and Steve Bahmer, president and CEO of LeadingAge Florida. Hospitals and long-term care facilities, which those entities represent, are some of the largest and most powerful industries in Florida.
When lawmakers negotiated the budget this year, House leaders proposed $514 million in hospitalreimbursement cuts for Medicaid — the federal and state program that covers millions of children, working poor, elderly and disabled Floridians. Although the cuts did not make the final budget, Tuesday’s meeting was a sign that House Republicans are serious about proposing similar tightening measures next year.
Avila, the chair of a committee that forms the House healthcare budget, noted in an interview that Medicaidreimbursement money could be spent on other healthcare services. For example, Florida’s Agency for Persons with Disabilities has a wait list of about 22,000 people hoping to get at-home or communitybased care.
‘CATASTROPHIC’ YEAR?
During a similar meeting in March, the committee asked some of those same healthcare executives about how the pandemic was affecting their industries. For example, Avila asked Mayhew whether 2020 would be a “catastrophic” year for hospitals financially.
“It’s difficult for me to comment on the definition of ‘catastrophic,’ ” Mayhew answered, noting that she would have to compare anticipated revenue with the final numbers, which had not been tallied yet.
Mayhew, a former top health official under Gov. Ron DeSantis, noted at the time that about $4 billion of federal emergency funding for hospitals from the Coronavirus Aid, Relief, and Economic Security (CARES) Act had not fully covered the lost revenues brought on by the pandemic.
In an interview this week, Avila said the message he got from that meeting was that hospitals were in dire straits.
“I think that it’s not productive to always come to the Legislature and say,
‘We need more, we need more, we need more,’ when in reality, the numbers suggest that you don’t need more,” he said.
Avila’s messaging is in keeping with years of
House leaders’ skepticism about hospitals and their reliance on state funding. José Oliva, the House speaker during the 2019 and 2020 legislative sessions, often blamed the “hospital-industrial complex” for the cost of healthcare in Florida.
But Mayhew said she never indicated her organization’s members would be operating in the red last year. And Senior, whose organization represents the hospitals that provide much of the Medicaid-funded services in the state, argued that it was misguided to focus on a hospital’s margins when contemplating Medicaid cuts. The most profitable hospitals are often those that care for relatively few Medicaid patients, he noted.
“They seem on the
House side to be very wrapped around margins,” Senior said. “But Medicaid services don’t build those margins.”
On Friday, after this story was published online, Sen. Aaron Bean, R-Fernandina Beach, Avila’s counterpart in the Senate, wrote in a text message that “Medicaid rate cuts are not on my radar at all at this time.”
AN UNCLEAR BUDGET PICTURE
Florida avoided Medicaid rate cuts in 2021 in large part because of hundreds of millions in additional federal funding that has been available since early in the pandemic. But as lawmakers contemplate a budget for 2022, it’s unclear to what extent that money, which is unlocked with each extension of the federal coronavirus health emergency, will be available. Currently, the emergency is set to expire Jan. 16.
There are signs that lawmakers are looking to play nice with healthcare businesses. This week, a Senate panel advanced a proposal to extend COVID-19 liability protections for healthcare facilities.