In a sweeping 153-page opinion, the U.S. District Court for the Southern District of Florida ruled December 30 that the state of Florida is systematically violating the Medicaid Act by keeping reimbursement rates too low to attract medical providers.
“Based on the evidence in this case, I conclude that while reimbursement rates are not the only factor determining whether providers participate in Medicaid, they are by far the most important factor, and that a sufficient increase in reimbursement rates will lead to a substantial increase in provider participation and a corresponding increase in access to care,” U.S. Circuit Judge Adalberto Jordan wrote in the opinion.
Litigation in the case has spanned nearly a decade, having begun in 2005 when a group of pediatricians, dentists and nine children sued three state agencies in federal court.
Under the Medicaid Act’s Equal Access provision, states are “required to provide adequate funding to ensure that Medicaid beneficiaries have equal access to medical services and care as available to the general population in their geographic area.”
In the state of Florida, reimbursement rates are about 40 percent lower than reimbursement rates for comparable Medicare services, which are set at the federal level.
As described by the Court, the state Legislature mandates that the state Agency for Health Care Administration reach “budget neutrality” each year, meaning that the Medicaid budget must fit within a pre-determined allocation, regardless of what services are needed or legally required. As a result, the AHCA consistently sets “artificially low rates” to meet budget neutrality, in violation of the Equal Access and other provisions of the Medicaid Act.
The program also does not have any annual cost-of-living increases.
“In discharging its responsibility to set physical reimbursement rates, AHCA does not consider whether reimbursement rates are sufficient to ensure that children on Medicaid have access to health care service equal to that of other children in the general population,” the Court stated.
Among the Court’s many findings, it found that a third of the state’s children on Medicaid are not receiving required preventative services. An estimated 79 percent of this population is not receiving any dental services.