Florida sues Biden administration in spat over cost-sharing for child health insurance

Florida sued the federal Centers for Medicare and Medicaid Services on Thursday over the agency’s attempt to block the state government’s efforts to implement cost-sharing provisions for expanded child health insurance subsidies.

“This is something Florida cares deeply about,” Florida Agency for Health Care Administration Secretary Jason Weida told the Washington Examiner in an exclusive interview about the case. “We need to make sure that we’re there for [families], but we also have to watch out for the integrity of the program.”

Weida’s agency filed in the U.S. District Court for the Middle District of Florida for an immediate injunction in order to implement the expansion program while full adjudication is pending. Weida said he expects a preliminary hearing to be scheduled in the next couple of weeks.

The controversy began in June when Gov. Ron DeSantis (R-FL) signed H.B. 121, a bill to expand access to the state’s child health insurance program, Florida KidsCare. The legislation was intended to expand coverage of subsidized health insurance to households with income up to 300% of the federal poverty line, covering over 26,000 more children than the already 119,000 enrolled under current eligibility requirements.

To cover a portion of the expansion costs, parents of all CHIP recipients would be required to pay cost-sharing premiums ranging between $17 and $195 per month, depending upon income. Under the expansion, children can be disenrolled from the program if the parents do not pay a missed premium after a 30-day grace period.

The Biden administration, however, has taken increasing steps to block the implementation of the program, saying that the cost-sharing provisions are “red tape” that unnecessarily cause enrolled children to lose coverage.

CMS issued guidance in October requiring states to keep CHIP recipients in state-administered programs for the full calendar year irrespective of missed premium payments, making Florida’s program out of compliance.

The tensions between Florida and CMS culminated in December with a letter from Health and Human Services Secretary Xavier Becerra saying he “will not hesitate to take action” against Florida for the state’s insistence on enforcing cost-sharing rules.

“CMS is effectively imposing an expansion of entitlement benefits for children, requiring the provision of insurance potentially at no-cost for up to 11 months of the year,” Florida said in the lawsuit.

Florida KidsCare was created as a state private-public partnership in 1990 and was grandfathered into the national CHIP program in 1997. Weida argued this gives Florida grounds for more autonomy over the program’s implementation.

“This isn’t just something that was a federal government creation,” Weida said, “so we felt strongly that we ought to be able to run the program the way we want it to run.”

Weida contends that CMS’s efforts to block the CHIP expansion are tied to the Biden administration’s desire for Florida and nine other red states to expand Medicaid eligibility under Obamacare.

“In these letters where they’re threatening government action against the state, they’re trying to force us to expand Medicaid,” Weida said. “That’s another reason why we felt strongly about standing up to these bullying tactics.”

CMS told the Washington Examiner that it will not comment on pending litigation.

The DeSantis administration has had several clashes with Becerra’s HHS over the Medicaid program, with CMS audits increasing by nearly 40% compared to prior years, according to Weida.

Weida told the Washington Examiner that Florida “has not yet done and nor will it” expand Medicaid eligibility requirements.

“We know that it’s very hard to go from Medicaid to one of these expensive private insurance plans,” Weida said. “The CHIP program really plays an important part here as a bridge to get working families the help that they need, but it also requires a little bit of accountability and responsibility on their part.”

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Weida told the Washington Examiner that the cost-sharing provision is essential to the CHIP program in part due to the state’s constitutional requirement for a balanced budget. The expanded coverage is estimated to cost $90 million in the first year of implementation, with $23.1 million being covered by cost-sharing premiums.

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