Florida sues HHS over $97M in denied Medicaid payments

Florida filed a lawsuit against HHS that seeks $97.6 million in Medicaid payments the state was denied, according to court documents.

In a lawsuit filed April 27 in the U.S. District Court in Southern Florida, Florida asked the court to set aside a Feb. 25 appeals board decision that upheld the HHS denial of the Medicaid payments. 

The decision disallowed federal reimbursement related to Disproportionate Share Hospital payments and Low-Income Pool payments Florida made to hospitals and healthcare providers from July 2006 to June 2013, according to the complaint. Low-income pool payments are part of a special section 1115 Medicaid waiver in Florida.

Under the waiver, low-income pool payments were provided to hospitals that serve large Medicaid and uninsured populations for support beyond the disproportionate share hospital cap. According to the lawsuit, most of the Medicaid payments HHS wants to recover were for Miami-based Jackson Memorial Hospital, a public hospital that is the state's largest safety-net provider.

In the complaint, Florida said HHS has argued a hospital's uncompensated costs must be calculated for low-income pool payments "using a much more conservative methodology than the Medicaid statute permitted" for disproportionate share hospital payments.

CMS first denied $146 million in Medicaid payments to Florida in 2016. HHS later revised that amount in 2017 to the $97.6 million the state now seeks.

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