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The Obama administration is keeping the pressure on Florida to expand Medicaid under the Affordable Care Act. On Thursday, it proposed cutting more than $1.6 billion over two years in funding for Medicaid's Low-Income Pool in Florida. The offer, made in a letter from the Centers for Medicare and Medicaid Services to state officials, signals public progress in the negotiations that have been ongoing for months in that there actually is something on paper. (Scott, 5/21)

The federal government opened the door on Thursday to a compromise that could ease Florida’s budget impasse, rooted in a disagreement over Medicaid expansion and the cost of caring for the uninsured. In a letter to Florida’s top health care official, the Obama administration said that it could authorize $1 billion for the 2015 fiscal year and $600 million for the 2016 fiscal year to reimburse hospitals for treating patients who do not have insurance. The cost would be shared by the state and federal governments. The $1 billion offer is less than half of what the state requested for this year for the Low-Income Pool program, which is set to expire June 30. (Alvarez, 5/21)

The CMS is appearing to blink in its stare down with Florida over Medicaid expansion. The agency informed state officials that it tentatively plans to renew a waiver that has provided Florida billions in supplemental Medicaid funding to help hospitals with uncompensated-care costs. The Obama administration had tied renewal of the waiver—which it warned a year ago was ending—to Florida's expansion of Medicaid to adults with incomes up to 138% of the federal poverty level. HHS and CMS officials have said the administration does not want to provide supplemental hospital-care funding for people Florida could cover through a Medicaid expansion. The state filed a lawsuit in return, as it felt the Obama administration was trying to force it to expand coverage, something the U.S. Supreme Court had ruled against. (Dickson, 5/21)

Federal health officials told Florida Thursday that the state should expect big reductions in future years for a hospital payment program that's at the crux of a political stalemate blocking passage of a new state budget. In a letter to state health officials, the U.S. Centers for Medicare and Medicaid Services said the state may justify needing about $1 billion in government funding for uncompensated care next year, or less than half of what it got this year, and even less in subsequent years. That's a clear message from Washington that Florida needs to reform its hospital payment system. (Bousquet, 5/21)

The Centers for Medicare and Medicaid Services also told the state Thursday that as part of this “transition,” the LIP program also would decline to $600 million in 2016-17. The program is funded with local, state and federal dollars and the current almost $2.2 billion LIP includes $1.3 billion in federal money. News of the reduced health care cash is certain to shape the Legislature’s special session planned for next month to craft a state budget and debate a proposed, privatized form of Medicaid expansion pushed by the state Senate, but fiercely opposed by Scott and the House. (Kennedy, 5/21)

According to CMS, $1 billion from federal, state and local resources would “maintain stability while the system transitions’’ to new ways of paying hospitals for the high cost of treating poor patients as the federal government phases out the current funding system known as the low income pool, or LIP. Miami’s Jackson Memorial Hospital is by far the largest recipient of LIP money. Tampa General Hospital, All Children’s Hospital in St. Petersburg and Broward Health also are big recipients. They were promised $731 million this year in payments provided through federal and local tax money totaling nearly $2.2 billion. Carlos Migoya, chief executive of Jackson Health System, whose hospital network risked losing about $200 million a year without renewal or replacement of LIP, said the federal government’s letter was “a good starting point.” (Bousquet and Chang, 5/21)

Florida Gov. Rick Scott (R) last month sued the Obama administration over what he called an effort to force his state to expand Medicaid under ObamaCare, by withholding funds for a separate federal program that compensates hospitals for treating uninsured people, called the Low Income Pool (LIP). The allegations of coercion have spilled onto Capitol Hill, where Republicans have announced a hearing on the issue this summer and have written to President Obama calling on him to stop the “overreach.” (Sullivan, 5/21)

The Obama administration told Florida on Thursday it should prepare to receive significantly less funding under its Low Income Pool — but the money isn’t completely drying up. (Pradhan, 5/21)

While the Senate and House scrambled last week to agree on terms of a proclamation for a special session, Gov. Rick Scott had followed through on a threat to draft his own proclamation -- and on his terms. Those terms specifically excluded any discussion of Medicaid expansion that the Senate wants. Scott's document said "specifically excluding legislation expanding Medicaid eligibility." The Senate would never agree to such a blanket restriction. (Bousquet, 5/21)