Week in Tallahassee 9/2/2011

UPS AND POTENTIAL DOWNS … It may not last but state economists this week released a draft financial outlook that projects that Florida could have a $274 million budget surplus in the coming year.

But the same economists who projected the surplus warned that it will likely be wiped out in the next few months. The report notes that the surplus is dependent on growth that is “attributable to existing Florida residents spending more, rather than the effect of increased population. For this assumption to hold, consumer confidence has to remain strong.”

And so far that doesn’t appear likely as recent reports point out that unemployment remains high and consumer confidence keeps dropping. The University of Florida this week released its monthly report that found consumer confidence among Floridians has dropped to near record lows.

Still the new financial outlook was a bit of a vindication for the Republican-controlled Legislature since it noted the small surplus was made possible largely by the deep cuts in spending on health care and schools approved this past spring by legislators. Economists noted that this was first time “since the adoption of the constitutional amendment requiring the development of long-range financial outlooks, sufficient funds exist to meet all critical and other high priority needs identified for the three years contained in the outlook.”

AGENCY WARNS THAT IT IS STILL SPENDING TOO MUCH … In other budget news the Agency for Persons with Disabilities on Friday released a cost-containment plan that shows that despite cutbacks it is projected to exceed its current budget on Medicaid services for the developmentally disabled by $55.3 million.

Lawmakers earlier this year budgeted $810 million for the program that provides services to approximately 30,000 people who are developmentally disabled. The Florida Legislature also ordered a 4 percent cut in rates paid to providers as well as a freeze on providing additional services. But even with those cuts APD was forced to take additional measures this summer, including reducing the hourly rate paid to people who provide in-home support services.

The lengthy report on cost-containment strategies says there are additional cuts that could be implemented including cutting reimbursement rates once again. Some of the additional options may need approval from the Legislature or the federal government.

APD has repeatedly exceeded its budget in recent years and this past spring Gov. Rick Scott briefly ordered a 15 percent cut in payments to service providers that sparked a massive outcry.

PAIR OF PROPOSED AMENDMENTS UNVEILED … The 2012 session is already expected to be busy thanks to the once-a-decade chore of redistricting and the recurring struggle to balance the budget.

But this past week lawmakers started unveiling a long list of proposed bills for the session that starts in January. Sen. Joe Negron, R-Stuart, filed two proposed constitutional amendments: one that would make the commissioner of education an elected position and another that would abolish the Constitution Reform Commission as well as the Taxation and Budget Reform Commission.

Negron’s proposed amendment on education — SJR 96 — would dissolve the current State Board of Education — which hires the commissioner now — and would instead make the governor and Cabinet responsible for approving statewide education policy.

SJR 108 aims to abolish what Negron describes as “super-citizen” boards that meet every 10 years and have the power to place proposed constitutional amendments directly on the ballot. If 60 percent of voters approve the measure it would limit either could place future amendments on the ballot; to either the Legislature, or, citizen groups that launch petition drives.

GIVING THEM THE BUSINESS … The new Department of Economic Opportunity released its business plan this week calling for the use of financial incentives to out-of-state businesses willing to relocate here. The department estimated that the incentives could create 21,000 new jobs over the next two years.

The business plan — which was released along with a cover letter from Gov. Rick Scott — establishes three goals to attract out-of-state industries as well as expand existing businesses and create new businesses domestically.

In addition to creating 21,000 new jobs from out-of-state firms the goals are to create 23,630 jobs through expanding existing businesses and retaining 6,396 jobs at businesses classified as “at risk” for relocating outside of Florida. The new department is a result of the Agency for Workforce Innovation, the governor’s Office of Tourism, Trade, and Economic Development (OTTED) and some divisions of the Department of Community Affairs being rolled together. The new department comes on line Oct. 1.

FUTURE OF MEDICAID … Agency for Health Care Administration staff confirmed this week that medical loss ratios will be a requirement in an extension of an existing Medicaid waiver that is being sought by the state of Florida.

AHCA officials have spent the summer in negotiations with federal officials over the fate of the state’s $22 billion Medicaid program as they seek an extension of a current Medicaid pilot program up and running in five counties. That Medicaid 1115 waiver extension will serve as the foundation for a statewide overhaul of Medicaid that the state is also seeking.

Florida has been forced to seek temporary extensions of the waiver which expired in June. The state got another extension again this week.

Shelisha Coleman, a spokesperson for the agency, said once the state receives final approval on its Medicaid 1115 waiver extension it will “begin a period of further discussion and review” as it begins work on implementing the new statewide program.

The Legislature earlier this year rejected the notion of requiring medical loss ratios, which mandate that a certain percentage of money be spent on direct patient care. Coleman said managed care plans will be required to spend 85 percent of the premium they receive from the state on the care for Medicaid patients that are enrolled in the five county pilot program.

Reporters: Christine Jordan Sexton, Bruce Ritchie, Kim MacQueen, Ana Goni-Lessan