Florida hospitals historically have been reimbursed less than their actual costs for caring for Medicaid enrollees. On average, payment is 60% of total costs. This leaves an underpayment of 40%.
The Directed Payment Program provides funding for hospitals that provide inpatient and outpatient services to Medicaid managed care enrollees. As a Medicaid payment, this funding includes a combination of both Intergovernmental Transfers (IGTs) and federal dollars.
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Florida hospitals and health systems are entrusted to provide access to quality health care for their patients and communities. Hospitals also offer charity care to patients that cannot afford treatment and contribute to the overall community benefit.
Charity care is one component of Florida hospitals’ total community benefit, which also includes education and training of health care professionals and community health activities and partnerships. Florida hospitals provided $1.8 billion in charity care in FY 2021-22, according to the most recent data from the Agency for Health Care Administration.
The state fiscal year 2022-2023 budget included specific funding for an increase in the state’s minimum wage of direct care employees to $15.00 per hour. This increase requires all Florida Medicaid providers to submit a supplemental wage agreement by the Agency’s mandatory deadline.