Politico

DeSantis: Florida will need help making ends meet


TALLAHASSEE, Fla. — Florida Gov. Ron DeSantis on Tuesday said the state will need help covering costs associated with the coronavirus outbreak, expressing confidence that the federal government will help pick up the tab for increased Medicaid outlays.

And the state might have to borrow to deliver a $400 weekly benefit to unemployed workers that President Donald Trump mandated in an Aug. 8 executive order, he said.

The coronavirus outbreak and the ensuing job losses are expected to boost Florida’s Medicaid enrollment by 570,000 people more than state legislators had estimated, increasing the program’s cost by $1.6 billion this fiscal year. A federal stimulus package that covers the increased enrollment expires in December, after which the state will be left to pick up the cost.

In an interview at his office in the state Capitol, DeSantis said he expects federal stimulus funding to be extended through the end of the state’s fiscal year on June 30.

“We think that they’re going to continue that as long as there’s a state of emergency,” DeSantis said. “If we didn’t have that, then we’d have to do more in [general revenue].”

The governor’s confidence that Congress and the White House will come to the rescue isn’t shared by many policymakers in Washington, where negotiations between House Speaker Nancy Pelosi and Trump have come to a standstill. With no guarantee on an extension, the state Legislature could be confronted with a deficit. State economists are expected to draw up new forecasts Friday.

DeSantis handed down $1 billion in vetoes before signing this year’s $92.3 billion state budget in June. That savings, along with signs of improvement in revenue from the state sales tax, could help bridge the budget gap from increased Medicaid costs.

Since the pandemic started, DeSantis has been able to authorize spending without legislative interference under a state of emergency. Democrats repeatedly have called for a special legislative session to reexamine the budget. But even with looming budget holes, DeSantis said a special session isn’t necessary.

“Even if nothing happened in D.C., we would definitely be able to get to the end of the calendar year with no problem,” DeSantis said Tuesday. “We’ll see kind of what the revenue looks like.”

The state Agency for Health Care Administration last week estimated that the coronavirus response would lead to a $1.6 billion overrun of a $31.3 billion Medicaid spending plan that took effect July 1. The joint state Legislative Budget Commission must approve any increase in Medicaid spending.

On unemployment, the Trump administration has suggested that states tap into unspent federal relief money, a plan DeSantis dismissed Tuesday as not viable. The more than $4 billion sent to the state by Congress under the CARES Act so far is needed to balance the state’s budget and close a $2 billion gap in lost tax collections, he said.

DeSantis said he’s exploring the possibility of a loan from the U.S. Department of Labor that could be used to extend jobless benefits that were cut off due to the impasse in Washington.

“If there’s a way to do it through that, then we will proceed and do it,” DeSantis said.

Florida has already paid out more than $13.4 billion in state and federal unemployment benefits since the pandemic forced the shutdown of the state’s economy in mid-March. The state might have to borrow from the U.S. DOL to cover its share of Trump’s new unemployment benefits, DeSantis said.

Under state law, such a move likely would trigger an automatic tax increase on Florida employers.

“We don’t want that to happen, but that is a realistic possibility,” DeSantis said.

In the interview, DeSantis also said his decision in March to ban hospitals from offering non-emergency elective medical procedures was a mistake. At the time, he feared people infected by Covid-19 would fill up the state’s 60,000 hospital beds.

By the time he lifted the ban in May, roughly 40 percent of those beds had remained available for several weeks.

“That’s when you started seeing hospitals laying off staff — there just wasn’t enough work,” DeSantis said.

More than 23 percent of hospital beds were available as of Tuesday afternoon, according to the Florida Agency for Health Care Administration.

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