Miami Herald: Florida businesses stuck with Medicaid tab for state’s inaction

Excerpted from the Miami Herald

Bloomberg News

Florida’s business community, a bastion of conservatism on most matters, was among those pushing hardest for a state measure that would have adopted a major part of President Obama’s federal healthcare law.

What made the situation unusual was that business wasn’t getting its way in a state where it almost always does. State lawmakers adjourned last month without agreeing on a proposal that would extend Medicaid coverage to low-income residents without adequate healthcare, even with the backing of Associated Industries of Florida and the Florida Chamber of Commerce, as well from Republican Gov. Rick Scott. The business leaders will have to wait until next year to try again.

Under the healthcare law, the state would get about $51 billion in federal money in the next 10 years to expand Medicaid by raising income eligibility limits to 138 percent of the 2013 poverty level, or those making as much as $32,499 for a family of four. If the state eventually agrees to a Medicaid expansion, the federal government would cover all costs for the first four years. Funding would drop in the following years before leveling off at about 90 percent by 2020.

Businesses have a big stake in the outcome. The healthcare law requires companies with more than 50 full-time employees to provide health insurance to anyone working more than 30 hours a week.
An expanded Medicaid program would extend those benefits to workers in the state’s vast tourism, hospitality and agricultural industries. The importance of the two sectors can’t be overstated: They employ large numbers of low-paid workers and account for as much as a quarter of the state’s $750 billion in annual economic output.

Without the Medicaid expansion, many of those workers must get insurance either from their employers or from a federal healthcare exchange. If an exchange is used, employers must pay fines ranging from $72 million to $108 million, or about $3,000 per worker, according to a Florida Chamber of Commerce estimate. It’s easy to see why Florida businesses would like the U.S. government’s help.

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