Special Session Recap – June 30, 2015

THE 2015 SPECIAL SESSION

HealthCare, Tax Cuts and The Budget – What This Means for Children

The budget impasse and abrupt ending to the 2015 regular legislative session left a lot of issues unresolved, the most notable being the constitutionally required passage of an annual budget for FY 2015-2016. During the special session jointly called by President Gardiner and Speaker Crisafulli, to address tax cuts, health care and the budget to begin on July 1, much of the tension continued regarding how to address the 800,000 uninsured Floridians, and how to address the federal Low Income Pool (LIP) funding for hospitals.

Senate Closing the Health Coverage Gap Measure

On June 5, 2015, the House took up SB 2 – the Special Session version of the Senate Florida Health Insurance Exchange (FHIX) bill never heard by that chamber during the regular session. After a 7 hour debate in the House led by Rep. Mia Jones (D-Jacksonville), the bill failed on a vote of 41:72, with four Republicans voting with the Democrats. Subsequently, the FHIX bill was taken off the list of issues to be addressed during the Special Session.

House Health Care Cost Reducing Measures

Meanwhile the House proposed a number of bills to address a free market approach to health care cost reduction. Included on the list of those considered during the special session:

HB 21A by Rep. Jason Brodeur (R-Sanford) relating to State Group Insurance Program which passed the House on June 12 on a vote of 71:28. HB 21A established employee contribution rates for standard plans and high deductible health plans for the 2016 plan year reflecting the actuarial benefit difference between the HMO and the PPO. Employees would be given a choice between paying more for the higher value HMO and paying less, compared to the prior year, for the lower value PPO. Essentially employees would have a choice between richer benefits or greater take-home pay.

HB 23A by Rep. Heather Fitzenhagen (R-Ft. Myers) relating to Recovery Care Services passed the House on June 12 on a vote of 78:21. The bill created a new license for a Recovery Care Center (RCC), to provide post surgical and post diagnostic recovery care services, to which a patient is admitted and discharged within 72 hours, and which is not part of a hospital.

HB 25A by Rep. Fred Costello (R-Port Orange) relating to Direct Primary Care passed the House on June 12 on a vote of 99:1. Direct primary care (DPC) is a primary care medical practice model that eliminates third party payers from the primary care provider-patient relationship. Through a contractual agreement, a patient pays a monthly fee, usually between $50 and $100 per individual, to the primary care provider for defined primary care services. After paying the fee, a patient can utilize all services under the agreement at no extra charge. Some DPC practices also include routine preventative services, women’s health services, pediatric care, urgent care, wellness education, and chronic disease management.

HB 27A by Rep. Cary Pigman (R-Sebring) and Rep. Daphne Campbell (D-Miami Shores) relating to Drug Prescription by Advanced Registered Nurse Practitioners and Physicians passed the House on June 12 on a vote of 97:2. Unlike all other states in the U.S., Florida does not allow advanced registered nurse practitioners (ARNPs) to prescribe controlled substances, and is one of two states to not allow physician assistants (PAs) to prescribe controlled substances. The bill authorized ARNPs to prescribe, dispense, order, and administer controlled substances, but only to the extent authorized under a supervising physician’s protocol.

HB 31A by Rep. Jason Brodeur (R-Sanford) relating to Certificate of Need (CON) for Hospitals passed the House on June 12 on a vote of 72:28. The certificate of need (CON) program, administered by the Agency for Health Care Administration (AHCA), requires certain health care facilities to obtain authorization from the state before offering certain new or expanded services. Health care facilities subject to CON review include hospitals, nursing homes, hospices, and intermediate care facilities for the developmentally disabled. Currently, there are 22 states that do not require CON review for the addition of hospital beds. Of those states, 14 do not have CON requirements for any type of health care facility or service, and 8 states do not have CON requirements relating specifically to the addition of hospital beds. Opponents of the legislation point to the safety protocols that could be lost in eliminating CONs.

On June 9, the Senate Health Policy Committee, chaired by Sen. Aaron Bean (R-Fernandina Beach) held a 3 hour workshop on these proposals to eliminate certificate of need requirements for hospitals looking to expand or open new facilities, to let nurses and physicians’ assistants prescribe certain medications, and the other steps House leaders said will reduce the cost of health care. However, the House bills were never voted on by the Senate. According to Sen. Bean the 20 day special session did not provide enough time for substantive debate on these important health issues.

Governor Scott’s Commission on Healthcare and Hospital Funding

During the month of June, Governor Rick Scott’s Commission on Healthcare and Hospital Funding met in Tallahassee to kick off its “Spotlight Transparency Tour” which later convened in Tampa on June 17. The Commission is scheduled to meet in Jacksonville the week of June 29, and in Miami on July 13. The initial charge to the Commission was “to review Florida hospital, insurance and healthcare providers, and how any taxpayer funds and government policies contribute to the quality, profits, (including executive compensation packages) and losses of these institutions, and their impact on the affordability, access and quality of healthcare services for Florida families …”. The scope of the review was later reduced to looking at these issues for hospitals only.

Tax Relief Package

The Legislature passed HB 33A – Taxation by Rep. Matt Gaetz (R-Shalimar) and sent it on the Governor’s desk on June 15 for his signature. With $427.8 million in proposed tax cuts, the bill provides for a wide range of tax reductions designed to directly impact both households and businesses. The bill includes the following tax rate reductions:

• State communications services tax (CST) rate by 0.9 percentage points, with an additional temporary 0.9 percentage point reduction in the following year; state sales tax rate on rental of commercial real estate by 0.4 percentage points, with an additional temporary 0.1 percent reduction in the following year.
• New or expanded sales tax exemptions for the following: agricultural items, including feed for aquatic organisms, irrigation equipment, costs of maintenance and repairs of irrigation and power farm equipment, stakes, and certain trailers; K-12 school food and beverage concessions in support of extracurricular activities; machinery and equipment used for metal recycling; gun club memberships or admissions; and motor vehicles brought to Florida by military service members deployed outside of the U.S.
• Sales tax holidays: a three-day “back-to-school” holiday for clothing, footwear, school supplies, and computers; and a single-day tax free period for college textbooks and instructional materials near the beginning of the fall, spring, and summer semesters during the 2015-2016 academic year.
• Property taxes: increases from $500 to $5,000 of the value of the longstanding exemption for widows, widowers, blind, or totally and permanently disabled persons; and updates and expansions for the current partial homestead exemption available to military service members deployed overseas.
• Corporate income tax changes: increases total tax credits available for voluntary brownfields clean-up; revises the distribution for the current research and development tax credit and increases the annual credits that can be awarded; extends the Community Contribution Tax Credit program with $14.7 million in tax credits for one year (also taken against sales tax).

The Budget

After intense budget conference negotiations begun on June 6 by the Appropriation Subcommittee chairs and completed by the full Appropriation chairs Sen. Tom Lee (R-Brandon) and Rep. Richard Corcoran (R-Lutz) during the early hours of June 16, the budget was printed and sent electronically to the members late afternoon that day. This was in accordance with the legislature’s unofficial timetable to end the Special Session by Friday, June 19, after the required 72-hour “cooling off” or review period.

On June 19, the Senate took up the Appropriations bill (SB 2500A) passed and passed it on a vote of 37:0. The bill was then sent to the House which passed it on a vote of 96:17. SB 2500A, the Implementing bill to the 2015-2016 Appropriations Act (SB 2502A), and the various conforming bills were quickly sent to the Governor for signature.

The Children’s Budget 

The budget included some noteworthy increases in programs and services for children, persons with disabilities, and the juvenile justice system.

Among the highlights (mentioned more fully later):

• $21 billion in education funding, $780 million spending increase that would increase per-student funding by 3 percent
• $59 million for child welfare enhancements
• $18.3 million for federally qualified health centers
• $40.7 million to serve 2,000 people on the Agency for Persons with Disabilities waiting list
• $73.3 million for substance abuse and mental health initiatives
• $12 million to help the families of children with disabilities pay for educational services, a program that has been a key priority of Senate President Andy Gardiner, R-Orlando
• $55 million for therapy, tutoring and educational services to children with disabilities through the Personal Learning Scholarship Account
• $13 million more for Early Steps to help infants and toddlers with developmental delays
• $400 million in state money to increase base Medicaid rates for hospitals, which allows the state to draw down approximately $600 million in federal funds

A number of budget conforming bills related to children were also passed:

SB 2510A relating to the Allocation of Funds for Community-based Care (CBC) Lead Agencies addresses the allocation methodology for core services for CBCs. Beginning in Fiscal Year 2015-2016 twenty percent of new core services funding will be allocated to all CBCs, and eighty percent will be allocated to only CBCs that have base funding that is below their equitable share as determined by the equity allocation model. The bill also amended the equity allocation model, placing a greater emphasis on the number of children in the care of CBCs.

SB 2508A the Medicaid conforming bill deletes a statutory provision requiring AHCA to use certified public expenditures of general revenue appropriated for Healthy Start services for the MomCare Network, a program to reduce infant mortality deaths and improve birth outcomes. The change includes any associated federal match, for the purpose of supporting AHCA’s contract with an Administrative Services Organization (ASO) representing all Healthy Start coalitions.

Governor Scott’s Budget Actions

Governor Rick Scott signed the 2015-2016 State budget into law in his office on June 23, 2015. Along with the signed budget, the Governor also included a Veto List containing $461.4 million in special projects and a Transmittal Letter, detailing reasons for the vetoes. The Total Budget for 2015-2016 is $78.2 billion which includes $1.2 billion in General Revenue reserves.

Among the casualties on the Veto list were K-12 Mentoring Programs, the Healthy Families Nurse-Family Partnership Program, and some key programs for families with children born with unique abilities (priorities of President Andy Gardiner).

The Governor’s message outlined some strategic investments in the budget including:

• Historic funding for the Agency for Persons with Disabilities – serving another 2,000 individuals and eliminating the existing critical needs waitlist.
• Historic Total and State K-12 Public School Funding – historic funding of $19.7 billion, of which $10.9 billion is historic state funding for K-12 public schools. Total funding results in a per-student funding of $7,097. This includes $60 million for digital classrooms.
• Early Learning – $389.3 million toward the Voluntary Pre-K program, and $560.5 million for the School Readiness program, including an increase of $5 million to target children up to age five on the wait list. The budget also includes $10.5 million for an early learning performance pilot program to award child care providers and instructors for improving quality.
• Continuing Reforms in Juvenile Justice – With a continued decline in residential commitments of youth resulting from effective prevention and intervention services, the budget continues and expands prevention and treatment programs to more at risk youth. This investment includes:
  • An additional $2.1 million to increase capacity in existing PACE Centers for Girls across the state;
  • An additional $3.3 million for the Associated Marine Institute to provide gender-specific programming and in-home counseling services to at-risk a delinquent youth; and
  • An additional $3 million for Boys and Girls Clubs to provide delinquency prevention programs to over 16,000 youth at risk of entering the juvenile justice system, and $1.5 million for the Big Brothers Big Sisters programs targeting 1,200 at risk youth.
• Protecting Families from Abuse and Violence – $4 million for the continued funding of the 26 child advocacy centers statewide that provide services to victims of child abuse and neglect.
• Supporting People with Developmental Disabilities – Record investments totaling $1.2 billion into the Agency of Persons with Disabilities and provides over $40 million to remove more than 2,000 individuals from the waiting list for the third year in a row. This is an increase of $57 million over current year funding. This funding will serve more than 2,000 individuals and eliminate the existing critical needs portion of the waitlist as well as individuals transitioning out of school.
• Healthy Families – Increased funding for Healthy Families by $3.9 million to expand home visiting services for expectant and new parents whose children are at risk of abuse and neglect. Healthy Families is a nationally accredited, evidence-based program that has been proven to reduce incidents of child abuse and neglect.
• Family Intensive Treatment Teams – $2.4 million in new funding to implement evidence-based practices for treating a parent’s mental health and substance abuse disorders that put children at risk of maltreatment.
• Community Action Treatment – An additional $1.5 million in new funding to add two new additional Community Actions Treatment teams to areas in need. These teams provide community in home services to severely mentally ill children and their families.
• Human Trafficking – The budget includes $2.2 million for five safe houses across the state to provide more emergency and long-term shelter to victims of human trafficking while they recover from commercial sexual exploitation and receive rehabilitative services to help integrate them back into their communities.
• Maintenance Adoption Subsidies – An additional $18.3 to fully fund the increased number of children with special needs adopted by Florida families.
• Local Community Based Care Lead Agencies – $29.1 million in new funding to the state’s primary foster care providers for direct services to children and families to improve child protection and abuse prevention services.

A detailed chart of budget items is found here.

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