Jim Saunders, Health News Florida, Author at ��ϳԹ�� News

Hot-Button Medicaid Bill

Jim Saunders, Health News Florida — Thu, 17 Feb 2011 18:42:16 +0000

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Florida would start moving to a statewide system of Medicaid managed care by the end of this year and would try to put strict limits on how much tax money goes into the program, under a wide-ranging Senate bill released this morning.

The 202-page bill would carve the state into 19 regions and use HMOs and other types of managed-care plans to oversee services for the vast majority of Medicaid beneficiaries.

Senate Health and Human Services Appropriations Chairman Joe Negron, R-Stuart, said the new managed-care system could be operating in heavily populated areas early next year. It would have to be fully in place for most beneficiaries by Dec. 31, 2012; for people needing long-term care, the deadline would be March 31, 2013.

Senate leaders also included a nuclear option if the federal government doesn’t go along with the proposal: The bill calls for the state to begin running the program itself — forgoing billions of dollars in federal funding — on Dec. 31 if Washington doesn’t approve.

Negron said he is confident the Obama administration will reach agreement with the state and cited a decision this week in which federal officials allowed Arizona to cut Medicaid services.

“We’re going to ask for flexibility,” said Negron, the chief architect of the bill. “We’re not asking to do outrageous things. We’re asking to do common-sense things.”

But Senate Minority Leader Nan Rich, D-Weston, said the state needs to be willing to compromise with the federal government and warned of a “crisis” if the state actually takes control of the program. She estimated the move could cost the state as much as $12 billion a year in federal funding, based on budget estimates for the 2011-12 fiscal year.

The bill touches on a variety of hot-button issues in the Medicaid program and will spur a debate that lasts throughout the spring legislative session. Senators also will have to reach agreement with the House, which passed a different Medicaid overhaul plan last year.

Legislative leaders and Gov. Rick Scott vow to rein in the $20 billion program, which they blame as a major factor in the state’s budget problems.

The bill takes numerous steps to try to control costs. As an example, it would place a strict limit each year on how much money can be spent on Medicaid and calls for cuts if spending looks like it would go over those limits during the middle of a year.

“We’re going to decide how much we spend on Medicaid,” Negron said during a meeting this morning. “We’re the appropriators.”

The bill also would put more costs on Medicaid beneficiaries, including requiring many to pay $10-a-month premiums. Beneficiaries who use emergency rooms for non-emergency services would get hit with $100 charges.

“People are showing up in emergency rooms for things a reasonable person knows is not an emergency,” Negron said.

But Sen. Eleanor Sobel, D-Hollywood, questioned how it would be determined whether a person has an emergency condition — and whether they would get hit with the $100 charges.

The bill would create a bidding-type process for choosing managed-care plans to operate in the 19 regions. Along with HMOs, it anticipates using such things as provider-service networks, which can be local networks of hospitals and other types of medical professionals.

The proposal would require managed-care plans to sign five-year contracts and includes provisions aimed at holding them accountable. For instance, it would require that plans spend 90 percent of the money they receive on patient care — a concept generally known as a medical-loss ratio. Such ratios are controversial.

In including long-term care in the new system, however, the bill backs a longstanding priority of the managed-care industry.

People currently in nursing homes would not be placed in managed care. But other seniors would be enrolled in managed care, with the goal of providing services that would help them continue to live in their residences.

The Senate bill, however, does not include managed care for people with “developmental” disabilities such as autism and Down syndrome. Proposals to include such people in managed care have touched off opposition from providers and advocates.

Florida currently has a pilot program that requires managed-care enrollment for most Medicaid beneficiaries in Broward, Duval, Clay and Baker counties. But the Senate bill — along with the House bill last year — would be dramatic expansions of that program.

–Health News Florida Capital Bureau Chief Jim Saunders can be reached at 850-228-0963 or by e-mail at jim.saunders@healthnewsflorida.org.

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Florida Official Sends Back $1M

Jim Saunders, Health News Florida — Wed, 02 Feb 2011 13:00:00 +0000

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Florida has a huge budget hole, and nobody truly knows whether the federal health-care overhaul will be upheld or killed by the Supreme Court.

But state Insurance Commissioner Kevin McCarty is taking his chances.

After a Pensacola judge’s ruling that the overhaul is unconstitutional, McCarty said Tuesday he will forfeit a $1 million federal grant that was supposed to go toward beefing up oversight of health-insurance rates.

McCarty also is looking at the court decision to decide whether to seek a federal waiver of a requirement that insurers spend minimum amounts of premiums on customers’ health-care expenses. The commissioner said last year he would seek such a waiver, which would give insurers more leeway in complying with the requirements, known as a “medical-loss ratio.”

As far as the Office of Insurance Regulation was concerned Tuesday, the federal health law wasn’t in effect. At least in part, that is because the state Capitol is in the same federal district as Senior U.S. District Judge Roger Vinson, who found the law unconstitutional Monday.

“As of right now, it doesn’t exist,” Deputy Insurance Commissioner Mary Beth Senkewicz said during a conference call of the McCarty-chaired Health Insurance Advisory Board.

McCarty’s disclosed the decision to give up the $1 million grant during the conference call and also sent a letter Tuesday to a top federal health official. The Office of Insurance Regulation was awarded the grant last year to hire workers and upgrade technology.

“No drawdown of any of the $1 million will occur,” said the letter, which gave no explanation.

McCarty gave a brief explanation for his decision, saying he was concerned about intrusiveness of the federal government. He also pointed to a Pensacola judge’s ruling. He did not give any indication whether Gov. Rick Scott influenced the move, though Scott said earlier in the day that the state will not spend much time or money carrying out the law until court challenges are resolved.

“Quite frankly, yesterday’s court decision just made the decision (to give back the money) that much easier,” McCarty said.

But Laura Goodhue, executive director of the consumer-advocacy group Florida CHAIN, said the grant was supposed to help policyholders by “shedding light” on how insurance premiums are set.

“Florida needs to prepare for health-care reform, and we should be accepting grants from the federal government that will help us cover our expenses,” said Senate Minority Leader Nan Rich, a Weston Democrat who is a top lawmaker on health issues.

McCarty is an appointed official who reports to Scott and the state’s all-Republican Cabinet. He served in the job under former Govs. Jeb Bush and Charlie Crist and is a national leader among insurance commissioners — but has faced recent speculation about whether he will keep the position after wholesale changes in the governor’s office and Cabinet seats during the November elections.

Tuesday’s decision was not the first time Florida has foregone federal funding that could help carry out the law. The state did not apply last year for money in what is known as the “Consumer Assistance Program” — which is designed to help people with insurance decisions and information.

Goodhue said that program could have provided $2 million to Florida, which was one of about 15 states that did not receive a grant.

It also is unclear whether the state Agency for Health Care Administration will apply for a newly available grant to prepare for creating a health-insurance exchange, which would provide a sort of marketplace where consumers could shop for coverage.

AHCA did not respond to repeated questions during the past two weeks from Health News Florida about whether it would apply for the exchange grant. Late Tuesday afternoon, AHCA referred all questions about the federal health law to the governor’s office, which did not return a phone call.

Scott brushed aside a question Tuesday about whether Florida would be ready to implement the law if legal challenges ultimately fail. Major parts of the law are scheduled to take effect in 2014.

“The state won’t be caught flat-footed,” he said. “We’ll be ready.”

But Rich said the state should not stop moving forward with the law.

“Until the Supreme Court overturns it or until the Congress changes it, we need to abide by what the law is,” she said.

In discussing his decision Tuesday to ditch the $1 million grant, McCarty pointed to a dispute in Connecticut that he said indicated the federal government would be too intrusive.

McCarty did not explain further. But federal health officials criticized Connecticut in October for approving a rate increase of as much as 47 percent for Anthem Blue Cross and Blue Shield — and tied the criticism to a $1 million grant that Connectictut received, according to a report in the Hartford Courant.

The federal government sent a letter saying Connecticut received the grant “based on its representation that it would rigorously review rates.” But the letter said federal officials were surprised when Connecticut approved the rate increase without holding a public hearing or disclosing certain information about the hike.

–Capital Bureau Chief Jim Saunders can be reached at 850-228-0963 or by e-mail at jim.saunders@healthnewsflorida.org.

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Florida GOP Targets Individual Mandate In Health Law – Again

Jim Saunders, Health News Florida — Tue, 23 Nov 2010 20:00:00 +0000

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Florida Republican lawmakers are reviving a proposed constitutional amendment that takes aim at a major part of the federal health overhaul — with Senate President Mike Haridopolos planning the unusual step of sponsoring the proposal himself.

Rep. Scott Plakon, R-Longwood, made sure the proposed amendment was the first piece of legislation filed in the House for the 2011 legislative session. It was formally filed at 11:58 a.m. last Tuesday, less than two hours after lawmakers gathered in Tallahassee to swear in members and select leaders.

The proposal, if ultimately approved by voters during the 2012 elections, is aimed at allowing Floridians to opt out of a federal requirement that they buy health insurance or face financial penalties. Lawmakers passed a largely identical proposal during the 2010 session, but the Florida Supreme Court blocked it from going on the November ballot because of misleading wording.

David Bishop, a spokesman for Haridopolos, said in an e-mail Monday that the Senate president plans to file the Senate’s version of the proposal. A Senate president has wide-ranging power but typically leaves filing such legislation to other members.

Bishop described Haridopolos’ decision to sponsor the proposed amendment as “rare, not unprecedented.” Haridopolos, R-Merritt Island, has been an outspoken critic of the health overhaul, which the Democratic-controlled Congress and President Obama approved in March.

“He feels strongly voters should have a chance to vote on this amendment and were denied the opportunity by the Florida Supreme Court,” Bishop said in the e-mail.

But Rep. Mia Jones, a Jacksonville Democrat who works on health-care issues, said the proposed constitutional amendment will take up time that could be better spent focusing on how to carry out the federal law. Also, she said the debate will come at the same time the Florida Attorney General’s Office is challenging the law in court.

“I don’t think it (the proposed constitutional amendment) is a good idea,” Jones said. “I think we already have a lawsuit that is going forward.”

The proposal targets what has become known as the “individual mandate” that Congress included in the Patient Protection and Affordable Care Act. That mandate will require Americans to have health insurance starting in 2014 or pay penalties.

The amendment would add language to the Florida Constitution that says, in part, “a law or rule may not compel, directly or indirectly, any person, employer or health-care provider to participate in any health-care system.”

Lawmakers approved that same language during the 2010 session and expected it to go on the November ballot. But the Supreme Court on Aug. 31 rejected the proposal because it said lawmakers included misleading wording in a summary that voters would see when they cast ballots.

The disputed summary wording said the amendment would “ensure access to health-care services without waiting lists, protect the doctor-patient relationship (and) guard against mandates that don’t work.” A circuit-court judge ruled — and the Supreme Court agreed — that those broad claims were not backed up in the actual text of the constitutional amendment.

Plakon said Monday he eliminated the disputed summary wording from the 2011 proposal, but otherwise it is identical to the 2010 measure. The legislation is known as House Joint Resolution 1, as proposed constitutional amendments are called “joint resolutions” instead of bills.

The Supreme Court’s decision angered Republican lawmakers, who contend that the federal government should not be able to force Floridians to buy health insurance. Voters in other states, such as Missouri, Arizona and Oklahoma, have already passed similar measures.

Also, in Washington D.C, Republican Sen. Scott Brown of Massachusetts and Democratic Sen. Ron Wyden of Oregon are pushing a proposal that would allow states to opt out of the individual mandate in 2014 if they meet health-system requirements set by the U.S. Department of Health and Human Services. The federal law currently allows states to seek to opt out in 2017.

Even if Florida voters approve the opt-out constitutional amendment in 2012, it might not end the question of whether they can ignore the coverage requirement. Opponents of the proposed amendment say the Supremacy Clause of the U.S. Constitution bars Florida from choosing on its own to opt out of the federal law.

At a minimum, however, the proposed constitutional amendment would add fuel to the 2012 elections. It would be on the ballot at the same time Obama is expected to seek re-election.

With Republicans holding huge majorities in both chambers of the Legislature, Jones acknowledged that she doesn’t think Democrats will be able to block the proposed amendment from reaching the ballot.

“No, I don’t see a way to stop it,” she said.

–Capital Bureau Chief Jim Saunders can be reached at 850-228-0963 or by e-mail at jim.saunders@healthnewsflorida.org.

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Can Florida Really Alter Medicaid?

Jim Saunders, Health News Florida — Thu, 18 Nov 2010 00:00:00 +0000

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Florida Republican leaders made a clear statement during a special legislative session Tuesday: They want to overhaul the Medicaid program and don’t want the federal government tying their hands.

But that might ignore Washington realities. Congress this year required states to increase the number of people eligible for Medicaid in the future — the opposite of giving Florida more flexibility to run the program.

What’s more, federal officials won’t agree to a relatively straightforward extension of Florida’s Medicaid “Reform” pilot, which required thousands of beneficiaries to enroll in managed care plans. Instead, the federal government will require changes in the pilot.

Lawmakers used the special legislative session Tuesday to pass a non-binding resolution that called for getting greater flexibility to change Medicaid and gradually shifting beneficiaries statewide into managed care. But the bottom line is that carrying out such ideas won’t be easy — or maybe even possible.

“I don’t anticipate that the federal government is going to leave all the decisions up to states, especially when they (federal officials) provide such a large portion of the funding,” Senate Minority Leader Nan Rich, D-Weston, said.

Even Niceville Republican Don Gaetz, a key Senate player on the Medicaid issue, acknowledged he doubts the federal government will give the state wide-ranging authority to change Medicaid.

When asked what gives him confidence of such federal approval, Gaetz replied: “Nothing. I have no confidence in the federal government’s willingness to allow states to be laboratories for change and improvement.”

But Gaetz also said that doesn’t mean the state should give up trying to overhaul the $20 billion program. “Medicaid is metastatic,” he said. “It’s dangerous, it’s deadly, it’s costly and it’s growing.”

A major factor in the growth of Medicaid is the recession, which has pushed hundreds of thousands of Floridians out of jobs and employer-sponsored coverage. The reported this week that the rate of workplace coverage dropped three percentage points between 2008 and 2009, to about 59 percent.

Senate leaders this morning also began an all-day meeting to listen to testimony about Medicaid. As a sign of the large financial stakes involved in the issue, early presenters included representatives of the hospital industry and the managed-care industry — along with the senior-advocacy group AARP.

Senate Health and Human Services Appropriations Chairman Joe Negron, R-Stuart, said during the meeting that he approaches the Medicaid overhaul as a “blank sheet of white paper” that will need to be filled in with details. Rich said the “$64,000 question” is how to fix the system, not whether it needs to be fixed.

“We all agree the system is broken and it needs to be reformed,” said Rich, who has long been involved in health and human-services issues.

The meeting and Tuesday’s resolution are initial steps in what likely will be months of debate about how to change the program, which has gobbled increasingly large chunks of the state budget in recent years.

Also during Tuesday’s special session, lawmakers overrode Gov. Charlie Crist’s veto of $9.7 million in funding for the Shands teaching hospital in Gainesville. The veto in May stunned lawmakers and also threatened millions of dollars in federal matching funds for other teaching hospitals.

House Speaker Dean Cannon and Senate President Mike Haridopolos, who were sworn into their offices Tuesday, have made seeking freedom from federal requirements a rallying cry as they prepare to tackle Medicaid during the spring legislative session.

Haridopolos has repeatedly likened the idea to federal welfare reform in the 1990s, which gave states a large amount of leeway in running aid programs. Despite possible federal obstacles, he said passing the resolution Tuesday was a start toward revamping Medicaid.

“I think we just clearly laid down the gauntlet,” the Merritt Island Republican said. “We’re going to take this on.”

The Medicaid resolution, which passed on voice votes in the House and Senate, only expressed the Legislature’s intent and does not make actual changes in the health program for low-income people. But it touched off a Senate debate that likely will be a preview of what is to come.

Along with calling for the federal government to give Florida more authority in running the program, the resolution also makes clear that Republican leaders want to gradually shift almost all Medicaid recipients into managed-care plans — even frail seniors who qualify for long-term care.

Sen. Mike Fasano, R-New Port Richey, objected to the possibility of putting seniors into HMOs and said lawmakers should not have taken up the resolution Tuesday.

“This goes beyond telling Congress to just leave us alone,” Fasano said.

But Negron said using managed care doesn’t necessarily mean enrolling people in HMOs. It also can involve such things as provider-service networks, which are local managed-care organizations that typically are linked to hospital systems.

“If you vote yes (on the resolution), you’re not voting to put a soul in an HMO,” Gaetz said.

The House and Senate spent the 2010 spring session working on changes to the Medicaid system but could not reach agreement on a final plan. Instead, lawmakers directed the state Agency for Health Care Administration to seek federal approval for an extension of the pilot program, which requires most Medicaid beneficiaries in Broward, Duval, Nassau, Baker and Clay counties to enroll in managed-care plans.

But federal officials have informed the state that they won’t approve a straight extension of the current program and will seek changes. AHCA and federal officials have been in discussions about the issue.

Greg Mellowe, policy director for the patient-advocacy group Florida CHAIN, said in an e-mail that the federal response to extending the pilot raises questions about whether even that program could expand further.

The “more grandiose proposal (in the Medicaid resolution) would seem to be a non-starter,” he said.

–Capital Bureau Chief Jim Saunders can be reached at 850-228-0963 or by e-mail at jim.saunders@healthnewsflorida.org.

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Health Issues Prominent In Fla. Governor Race

Jim Saunders, Health News Florida — Fri, 10 Sep 2010 15:06:00 +0000

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When it comes to health care, the Florida governor’s race offers voters a clear choice. Republican Rick Scott and Democrat Alex Sink disagree on hot-button issues from abortion to Medicaid.

Scott supports expanding a controversial Medicaid “reform” pilot statewide — or possibly creating a voucher system that would allow beneficiaries to shop for insurance.

But Sink says state leaders need to slow down and listen before deciding whether to expand the pilot, which requires low-income Floridians to sign up with HMOs and other managed-care plans.

Scott, who headed and funded a group that fought President Obama’s health-care overhaul last year, supports a lawsuit filed by Florida and other states to challenge the constitutionality of what Scott calls “Obamacare.”

But Sink’s campaign blasted the lawsuit,saying she “does not agree with using our tax dollars to advance a partisan, political agenda on an issue as important and personal as health care — or trying to overturn these needed reforms before they’re even given a chance to work.”

The Sink and Scott campaigns in recent days have answered a series of questions posed by Health News Florida about their positions on health-care issues such as Medicaid and the federal lawsuit. Other positions are evident in public documents and campaign websites.

On some issues, the candidates’ positions remain vague. But there is little question the next governor will face major health-care challenges, with Medicaid’s annual budget topping $20 billion and the federal health law fully taking effect by 2014.

Sink and Scott, who are running in the Nov. 2 election to replace outgoing Gov. Charlie Crist, don’t talk about the complicated Medicaid issue in splashy campaign ads. But House and Senate Republican leaders have already signaled that revamping the program will be one of their top priorities during the 2011 legislative session.

“Both sides (in the gubernatorial race) know that Medicaid is going to be a huge issue, something they’re going to have to deal with,” said Michael Garner, president of the Florida Association of Health Plans, an HMO industry group.

While details might vary, Scott is lined up with the legislative leaders’ philosophy of moving Medicaid beneficiaries into HMOs and other managed-care plans. Supporters say such a move would help control costs and reduce fraud by eliminating what is known as a “fee for service system,” which involves the state making payments to tens of thousands of doctors and other providers.

Scott’s campaign said he would support a statewide expansion of a five-county “reform” program that former Gov. Jeb Bush championed. That program, which operates in Broward, Duval, Nassau, Clay and Baker counties, requires most beneficiaries to enroll in HMOs or provider-service networks, which are managed-care plans typically run by hospital systems.

Also, Scott indicated he could back a proposal offered by some Senate Republican leaders to begin providing vouchers that Medicaid recipients would then use to buy insurance. That would be a dramatic change in the Medicaid program, however, and critics have questioned whether the federal government would approve it.

In response to Health News Florida’s questions, the Scott campaign said major changes are needed in Medicaid, particularly because the new federal health-reform law will expand enrollment in the coming years.

“(There) are a lot of inefficiencies in the government-run health care program, and Obamacare is going to make it unaffordable,” the campaign said.

Sink agrees that Medicaid needs changes to rein in soaring costs, but her campaign said reforming the system is about more than the lowering the price tag. The campaign said Sink wants a “comprehensive reform package” that would ensure quality care to the various types of Medicaid beneficiaries and include services such as wellness programs and disease prevention.

The Democratic state chief financial officer also thinks Medicaid deliberations need to be in public and include groups and people who would be affected. Spokeswoman Kyra Jennings said in an e-mail that Sink wouldn’t support expanding the Bush reform program without first dealing with the Medicaid issue in public and taking a comprehensive approach.

“Alex Sink feels strongly that Medicaid reform must be addressed in a public forum — not pushed through the Legislature in the dark of night without public debate,” the campaign said.

Laura Goodhue, executive director of Florida CHAIN, an advocacy group that is critical of the Bush reform plan, said listening to other ideas about changing Medicaid would be a good move. Florida CHAIN and other critics have long questioned whether HMOs restrict care to Medicaid beneficiaries to save money.

“It is a big deal, and I think the thinking right now from our current leaders in the Legislature (is) one-sided,” Goodhue said.

The issue also is tricky politically, as changes in Medicaid could affect the spending of billions of dollars and powerful special interest groups such as doctors, hospitals and HMOs. The Florida Medical Association, for example, often supports Republican candidates, but it also opposes a wide-ranging expansion of Medicaid managed care.

The FMA supported Scott’s Republican primary opponent, Attorney General Bill McCollum, but has not made an endorsement in the general election. FMA Executive Vice President Tim Stapleton said the group will make a decision based on issues such as managed care, Medicaid reimbursement for doctors and support for limiting medical-malpractice lawsuits.

“The high cost of medical liability insurance and extremely low Medicaid reimbursement rates have made Florida a challenging place to practice medicine compared to other states,” Stapleton said in an e-mail. “We know that physicians are choosing to either retire early or leave the state, and it is becoming increasingly difficult to recruit physicians to Florida.”

Scott became a multimillionaire in the health-care industry, serving as chief executive of the Columbia/HCA hospital chain in the 1990s and later helping found Solantic, a company that runs urgent-care centers. His tenure at Columbia/HCA has become a controversial issue in the campaign, because the company had to pay $1.7 billion in fines after he left because of Medicare fraud.

Before and during the campaign, Scott has been an outspoken critic of the federal health law. Sink, a former bank president who was elected chief financial officer in 2006, has been more circumspect on the issue.

But in response to questions, her campaign offered at least limited support for the law, pointing to moves such as helping Medicare recipients pay for prescription-drug costs — an issue that addresses what is known as the “donut hole” in Medicare.

“Alex Sink believes Floridians needed health-care reform and that many of the reforms finally passed were in the best interest of Florida, such as closing the prescription-drug ‘donut hole,’ offering tax breaks to our small businesses and ensuring people won’t get dropped from their insurance for pre-existing conditions,” the Sink campaign said. “Also, if Florida was not able to take advantage of these reforms, which were better than nothing, our state would be at a severe disadvantage economically.”

The candidates also clearly disagree about abortion. In June, for example, Sink issued a news release praising Crist for vetoing a bill that would have required women to undergo ultrasounds before they could receive abortions. She said the bill would have interfered with a personal decision women should make with their families and doctors.

“Tallahassee politicians have no place whatsoever in these types of important medical decisions,” Sink said.

But Scott said in an August interview with the Florida Baptist Witness newspaper that he would have signed the bill.

“I’m absolutely opposed to abortion,” Scott told the newspaper. “Yeah, it’s a moral evil.”

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Florida’s Health Exchange Doesn’t Fit New Law

Jim Saunders, Health News Florida — Tue, 11 May 2010 13:57:00 +0000

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When Republican lawmakers created the Florida Health Choices program in 2008, they billed it as a way to deregulate the health-care market for small businesses.

Two years later, Florida Health Choices has still not started offering coverage, and its leaders and lawmakers face a philosophical choice that could determine whether the program survives.

Florida Health Choices would not qualify as a state insurance exchange under the federal health-reform law, the Patient Protection and Affordable Care Act, signed into law in March. As a result, backers of the Florida Health Choices program will have to decide whether to push forward with their free-market vision or go along with requirements in a federal law that is loathed by many Republicans.

All states must have such an exchange by 2014 to help small businesses and individuals buy insurance coverage. But while the general thrust of the exchanges and Florida Health Choices is similar, the federal law doesn’t allow for the Florida program’s hands-off approach to the coverage that would be sold.

“We said we’re going to create a marketplace where nobody dictates what has to be sold or bought,” said Florida Health Choices Chairman Aaron Bean, a former lawmaker who led efforts to create the program. “The federal government is completely 180 degrees opposite of what we have done.”

Exchanges are a critical part of carrying out what has become known as the federal law’s “individual mandate,” which will require almost all Americans to have health insurance by 2014. In approving the mandate and exchanges, Congress also approved minimum standards for benefits, which Florida Health Choices does not meet.

Without changes to Florida Health Choices — or to federal law — the state would have to create at least one new exchange to meet the federal requirements. If Florida doesn’t set up such an exchange, the federal government would reach agreement with a non-profit organization to operate it.

Bean said Florida Health Choices will continue moving forward, and he hopes to start offering coverage this fall. As a sign of that, the program’s board of directors agreed Friday to hire Rose Naff, former head of the Florida Healthy Kids Corp., to serve as its first chief executive officer, at an annual salary of $120,000.

A former Republican House member from Fernandina Beach, Bean said he hopes Florida Health Choices will become “entrenched” and spur public support. He also said he hopes the November elections will bring changes in Washington.

But the prospect of a clash with federal law comes on top of repeated delays in getting the program started. Allen Douglas, a National Federation of Independent Business official in Florida, called the program a “good idea,” but he said it might be well into 2011 before many small businesses could participate — even if Florida Health Choices starts operating this fall.

“They drug their feet for two years. This was passed in 2008,” Douglas said. “Now they are where they are.”

Florida Health Choices was created in what amounted to a legislative shotgun wedding between the state House and Gov. Charlie Crist. While House leaders pushed for Florida Health Choices, Crist wanted a program known as Cover Florida that allowed insurance companies to sell stripped-down policies.

In the end, lawmakers and Crist approved a bill that included both programs. But two years later, neither has put a dent in reducing the nearly 4 million uninsured Floridians.

Cover Florida had signed up only 5,462 people as of Dec. 31, the end of its first year of operation.

Under Florida Health Choices, small businesses would be able to enroll in the program, and their employees could choose from a variety of health coverages provided by private companies. While that could involve buying insurance coverage, it also could involve such things as buying pre-paid contracts for limited health-care services.

The idea, at least in part, is to give a centralized system where small businesses can help employees get health coverage. Small businesses often do not have the buying power of large corporations and are not able to spread insurance risks as easily, which makes health coverage difficult to afford.

The insurance exchanges in the federal health-reform law also are designed to serve as markets where small businesses and individual customers can go for coverage. But unlike Florida Health Choices, the exchanges are required to sell insurance policies that include a list of “essential” benefits such as hospitalization, maternity care and prescription drugs.

Mary Beth Senkewicz, deputy commissioner for life and health at the Florida Office of Insurance Regulation, said lawmakers would need to make substantial changes in the 2008 law if the state wants to use Florida Health Choices as its exchange. She said it also would require changing the focus and philosophy of the program.

“I think you are well-positioned, if you are willing to adapt,” Senkewicz told the Florida Health Choices board.

Board member Tom Arnold, secretary of the state Agency for Health Care Administration, said the board needs to keep in mind the “big picture” as it moves forward with Florida Health Choices. He said the federal law could determine whether the program survives.

But in the meantime, the program is trying to overcome the continuing delays in getting started. Those delays began, at least in part, because it took Crist until early 2009 to name members of the board.

It also, however, has taken the board months to name a chief executive. Board members widely praised Naff, who led Florida Healthy Kids Corp. from 1990 to 2008 and most recently has held a high-ranking position at the Florida Department of Business and Professional Regulation.

“I’m in a hurry,” Bean said. “People in the state of Florida are ready to buy and sell product.”

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