Florida is addicted to federal money, State Rep. Matt Gaetz, R-Fort Walton Beach, said during the Crestview Area Chamber of Commerce Government Issues meeting. Kicking the habit will take a lot of political willpower, but it must be done because Medicaid negatively affects many other programs, he said.
“About one in six residents in Florida is on Medicaid. That costs us $20.4 billion out of our state budget of around $70 billion,” Gaetz said during the committee’s September meeting.
Because the state receives $1.40 from the federal government for every dollar it spends on Medicaid, Gaetz said there is little political willpower to reform the program.
The perception that the state is “making money” blinds legislators to the restrictions placed on receiving federal money, he said, saying, “You trade dollars for flexibility.”
Gaetz presented three possibilities for state legislators to handle what he perceives to be a Medicaid dilemma.
The first option, he said, is for the state to pull out of Medicaid, requiring the state to fund the portion currently covered by federal billions.
“That means draconian cuts or we’d have to raise significant taxes,” Gaetz said. “That could affect things we’re doing right here in Crestview to attract business from Alabama or other places.”
One way to help offset the cost is to require Medicaid recipients to post modest co-pays, Gaetz said. He cited a young dental hygienist he met who returned to Crestview to work in the county free health clinic. The dental hygienist’s biggest frustration, he said, is people who make appointments but don’t show up, Gaetz said.
“Folks don’t value things that are free,” Gaetz said. “He (the hygienist) said the best thing we could do is require a $5 co-pay so people have some skin in the game. When people show up, it’s an investment in their own healthcare.”
Gaetz said the federal government’s response to his proposal demonstrated the restrictions that come with accepting federal dollars.
“The federal government said no way,” Gaetz said.
Option two, “which I don’t like either,” he said, is potentially adding a million and a half people to the Medicaid rolls. That would place 4.8 million Floridians, or nearly a quarter of the state’s population, on Medicaid, potentially increasing the state’s cost by 8 to 10 percent.
“That means three of us would have to pay for our own healthcare and 33 percent of someone else’s,” Gaetz said.
The third option is to do nothing. “This option is the easiest for the state, but it’s worse for you in the business community,” he said to attendees.
“If nothing else happens, if there’s no inertia, it will fall on business to fund employees’ healthcare,” Gaetz said. “If there’s no change, this is what will happen. If we as a state do nothing … the cost of hiring would increase 130 percent for business to provide healthcare coverage.”
Gaetz said business owners in his district told him such an increase would put some of them out of business.
“You don’t want to have an environment where you make it harder to hire someone or keep current staff,” he said.
Unpopular as it is among his fellow legislators, the solution, Gaetz said, is to wean the state off federal money.
“We have to have the political courage to say ‘no’ to federal money,” he said. “It is not much more complicated than that. We need more legislators with the courage to say we need to make the tough choices today than to be under the thumb of the federal government. That means peoples’ pet projects are going to evaporate.”
Addressing the dilemma of funding Medicaid now is central to making many other needed projects come to fruition in the future, Gaetz said.
“When we talk about the Crestview bypass or doing things at the airport, it is all going to be primed by what we do with Medicaid,” he said. “We want to do things in the economic development space or the infrastructure space or the education space.”