Florida says privatizing Medicaid cut costs, but insurers say they’re underpaid by state

In less than a year, Florida’s switch to privately managed healthcare for more than 3 million poor, disabled and elderly residents has achieved one of its primary goals: cutting costs for Medicaid, the public health insurance program for low-income people that accounted for roughly one-fifth or about $9.5 billion of state spending last year.

But the savings may be short lived after the private companies that took over insuring Florida’s Medicaid patients asked for a mid-year raise of nearly $400 million, and a 12 percent rate increase starting Sept. 1.

That has state health officials, including Elizabeth Dudek, head of the Agency for Health Care Administration, worried that “the vast majority” of Medicaid savings from the first year could be wiped out if Florida gives in to the insurers’ demands.

-Miami Herald