New rules on child health insurance ramp up feds legal dispute with Florida

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New federal rules intended to ensure children from low-income families being removed from Medicaid do not lose health coverage could heighten tensions between the Biden and DeSantis administrations.

The Department of Health and Human Services on Wednesday announced it has finalized regulations that make it easier for children to be enrolled and stay enrolled in federally subsidized health insurance programs, including Medicaid and the Children’s Health Insurance Program, known as KidCare in Florida.

Under the new rules, children who become uninsured should be able to transition to KidCare immediately instead of an up to 60-day delay that may occur in Florida. The new policy also ends lifetime limits on how much the children’s health insurance programs spend on individual children and guarantees at least 12 months continuous coverage by restricting states to conducting no more than one eligibility check per year.

The move comes as more than 560,000 Florida children have been removed from Medicaid since last April when Florida undertook the first review of roughly 5 million Medicaid recipients since the end of the COVID-19 public health emergency. A state plan to handle the transition stated that eligible children would be covered through KidCare but the program’s enrollment has only risen by roughly 55,000 during the same period.

Health and Human Services Secretary Xavier Becerra
Health and Human Services Secretary Xavier Becerra [ Health and Human Services ]

Florida is the only state that has not taken advantage of more than a dozen waivers and options for states to ensure children do not lose health insurance during this period.

“The fact that so many children and families are losing their health care coverage in Florida is not just disturbing; it’s a tragedy for those families — especially if their children qualify to get the services, it’s unconscionable,” Health and Human Services Secretary Xavier Becerra told the Tampa Bay Times in an interview. “We will do everything we can to make sure kids are not caught up in this bureaucratic nightmare.”

Florida officials disputed Becerra’s characterization of the state’s handling of Medicaid, saying their approach is ensuring that assistance reaches those “truly in need, especially as Florida’s thriving economy may render some families ineligible for aid.”

“Attempting to shift blame onto states for federal regulations is both irresponsible and dishonest,” said Florida Department of Children and Families spokesperson Mallory McManus in an email. “Instead of always pushing to expand government, we encourage the federal government to adopt our successful approach to Medicaid redetermination.”

McManus also pointed to the Florida Legislature’s 2023 bill to expand KidCare to more low-income families, as exemplifying the state’s commitment to families.

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But that expansion is in doubt because of a dispute over a provision in the new rules that prevents states from ending coverage for children whose parents fail to pay monthly premiums.

The Florida Agency for Health Care Administration last month filed a lawsuit in federal court in Tampa, claiming that the federal government was exceeding its authority in pushing the provision. A hearing on the ongoing dispute is scheduled for April 18.

The expansion would have raised the family income limit for children to qualify for the program from 200% to 300% of the federal poverty level. It was estimated to provide health insurance for an additional 42,000 Florida children, according to an analysis of the bill.

The federal Children’s Health Insurance Program would cover about 72% of the cost, roughly $25 million per year, with the state picking up the remainder, estimated at about $10 million.

Monthly premiums for KidCare are either $15 or $20 depending on household income, but most families pay nothing at all, according to the KidCare website.

Child health advocates said the new federal rules will help low-income families ensure that their children can still receive medical care. Waiting periods for child health insurance programs are “outdated red tape barriers” to medical care for children, said Joan Alker, executive director at the Georgetown University Center for Children and Families.

“It is high time to get rid of these policies that place additional burdens on families,” she said.

Florida is now in the last month of its redetermination process, a period when it planned to assess the eligibility of children with complex medical needs.

Officials at the Florida Health Justice Project, a nonprofit that advocates for increased access to health care, said they have had a recent uptick in calls from panicked parents who were told by their child’s healthcare provider that their Medicaid coverage will lapse at the start of April.

“Parents need to know now what their options are and how they can best keep their children covered,” said Miriam Hartmatz, the nonprofit’s advocacy director.

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