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A standoff over expanding Medicaid in Florida escalated on Thursday after Gov. Rick Scott, a Republican, said he planned to sue the Obama administration for using what he called “coercion tactics” to try to pressure the state into adopting the program, a centerpiece of the president’s contentious Affordable Care Act. In a letter this week, the federal government made clear that unless the Republican-controlled state legislature moved forward with Medicaid expansion, it could lose as much as $2.1 billion in federal dollars to help hospitals care for the uninsured. The federal aid is scheduled to expire June 30. (Alvarez, 4/16)

Florida Gov. Rick Scott said Thursday he is suing the Obama administration for withholding federal money for hospitals that serve the poor, saying they are doing so because the state won't expand Medicaid. The announcement is another twist in what has been a gritty yearlong battle with the feds over roughly $1 billion in funds for Florida hospitals. The fight has come to a head as the state Legislature works to finalize a state budget before May 1. (Kennedy and Fineout, 4/16)

A spat between Florida officials and the Obama administration about the future of a fund providing more than $1 billion a year for hospitals escalated Thursday when Republican Gov. Rick Scott said he would take legal action. ... Federal officials say they have concerns over the structure and management of Florida’s fund and want the state to make changes to it before agreeing to continue funding it. Mr. Scott has accused Washington of trying to withhold the money to force the state to expand Medicaid eligibility under the Affordable Care Act. (Radnofsky, 4/16)

Scott singled out a letter in which federal officials acknowledged this week a connection between Medicaid expansion and negotiations over the state's "Low Income Pool." Florida stands to lose about $1 billion annually in federal funding to pay hospitals for treating needy patients. The Democratic president is "crossing the line into a coercion tactic" in violation of a 2012 Supreme Court ruling allowing each state to decide on expansion, Scott contended. (Cotterell and Stein, 4/16)

The Obama administration quickly accused Scott of misconstruing that court decision because the state is not being forced to do anything. And White House spokesman Josh Earnest blasted the governor for putting politics above people. “It’s difficult to explain how somebody would think that their political situation and their political interest is somehow more important than the livelihoods of 800,000 people,” Earnest said. (Caputo and Pradhan, 4/16)

The legal maneuver, which comes amid a tense standoff between the House and Senate over Medicaid expansion, was simultaneously lauded and lambasted. It also complicates negotiations over this year’s budget. ... “From where I sit, it is difficult to understand how suing CMS on day 45 of a 60-day session regarding an issue the state has been aware of for the last 12 months will yield a timely resolution to the critical healthcare challenges facing our state,” said Senate President Andy Gardiner, R-Orlando. The suit, which has yet to be filed, is only the latest round in an ongoing feud between Scott and CMS in connection with the LIP. (McGrory and Bousquet, 4/16)

Bush hadn't heard of the yet-to-be-filed lawsuit, but suggested all sides sit down and find a solution. "The feds and the executive branch and representatives from the House and Senate ought to get together and try to forge a compromise," he said. But would such a compromise involve expanding Medicaid, as proposed under the Affordable Care Act and rejected by the GOP-controlled Florida government in the past? "I don't know," Bush said. "That's their job, frankly. Expanding Medicaid without reforming it is not going to solve our problems over the long run." (Mazzei, 4/16)