Florida Republicans press CMS to approve hospital-directed payment program

Florida remains one of a small number of states that hasn’t seen a Medicaid program reauthorized. If an approval doesn’t come before the end of the month, it could throw Sunshine State hospitals into crisis, according to U.S. Rep. Neal Dunn.

The Panama City Republican led a letter nearly a year ago urging Health and Human Services Secretary Robert Kennedy Jr. to reauthorize the program. But despite a follow-up in September, the Centers for Medicare & Medicaid Services (CMS) has not addressed the concern.

“Florida serves the fourth-highest number of Medicaid patients in the nation, and the approval of the Directed Payment Program is critical for helping Florida hospitals stay financially viable to serve vulnerable patients,” Dunn spokesperson Eleanor Allison said in an email to Florida Politics.

Hospital leaders from Florida have increasingly found themselves lobbying in Washington. Mary Mayhew, President of the Florida Hospital Association, said the approvals were a top concern for the entire industry in Florida.

“We have a program proposal from the state of Florida to the Centers for Medicare and Medicaid Services that is inexplicably stuck. Meanwhile, the federal government has approved 32 other states for similar programs,” Mayhew said.

“We’re one of just four states that has yet to be approved. We run a lean Medicaid program in Florida. We’re 47th in the country in per capita Medicaid spending. This is irrational that CMS is standing between the state of Florida and the ability to support critical health care services. Honestly, I’m dumbfounded. This is so straightforward.”

The issue marks a significant departure from CMS treatment of other states, and Republicans have pointed to officials from President Joe Biden’s administration as potential sources of the delays. A majority of Republicans in Florida’s congressional delegation signed the letters, which assert that Florida’s program aligns with President Donald Trump’s conservative agenda.

“Without agency intervention, CMS is threatening to ignore the rulings of two Trump-appointed federal judges and force Biden-era policies into the language of the waiver. This result would impose unnecessary oversight burdens on the state,” reads the letter sent by Dunn’s Office from February 2025.

That letter was also signed by U.S. Rep. Vern Buchanan, the Longboat Key Republican who chairs the House Ways & Means Health Subcommittee. Republicans U.S. Reps. Aaron Bean, Gus Bilirakis, Kat Cammack, Mario Díaz-Balart, Byron Donalds, Carlos Giménez, Laurel Lee, John Rutherford, María Elvira Salazar and Greg Steube all cosigned the letter.

Dunn, a medical doctor, said the approval was part of a “troubling saga of CMS playing games with our home state.”

Florida in 2021 launched, with CMS approval, its hospital-directed supplemental payment program to assist the state’s Medicaid providers. But the program was audited, and Republican lawmakers say politics fueled funding.

“Disturbingly, while Florida faced scrutiny, states led by Democratic governors, such as California, escaped investigation despite very public accounts detailing that California had the same system of private arrangements,” Dunn’s letter reads.

“Indeed, during the same timeframe Florida was under CMS fire, CMS committed a historically large sum to support California Medicaid.”

Years of fights between Florida and the Biden administration resulted in audits and legal fights. But in 2024, the Democratic administration announced it would hold Florida and other states harmless for payment programs until 2028.

When the Trump administration returned to power last year, Florida medical leaders hoped for a smooth return to accepting the policies. But an extension of Florida’s program has remained in limbo since, and CMS has raised new objections to the program.

“Within 72 hours of Election Day, CMS informed Florida that more audit questions were imminent,” Dunn’s letter said. “Florida and its hospitals once again face unjustified uncertainty, with the potential to impact over 4.2 million Floridians eligible for Medicaid.”

Importantly, CMS in September announced new guidance aimed at strengthening oversight of state-directed payments.

“Protecting Medicaid’s long-term fiscal integrity is at the heart of the Trump Administration’s promise to the American people,” said CMS Administrator Mehmet Oz, who is a part-time Florida resident.

“By implementing safeguards required in the One Big Beautiful Bill Act, CMS is helping states continue to use state directed payments as a tool, while ensuring they are sustainable, transparent, and fully aligned with our mission to protect beneficiaries and preserve Medicaid for future generations.”

Republican lawmakers say the program needs to be addressed quickly by CMS.

“Because of this ongoing delay, Florida hospitals are increasingly concerned about the potential consequences for their patients, including limited access to essential health care services,” the most recent letter led by Dunn reads.

“We are now into the new year, and our hospitals are concerned about their ability to continue supporting vital healthcare services and the risk of reduced access for the millions of Floridians covered by Medicaid, including more than 2 million children.”