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State Faces Challenges on Medicaid Minimum Wage

State Faces Challenges on Medicaid Minimum Wage

Medicaid HCAF in the News

The news article below provides an update on HCAF’s joint lawsuit that challenges aspects of the $15 minimum wage requirement for direct care workers that provide Medicaid services. The status of the lawsuit is still pending, and further updates will be forthcoming.

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State Faces Challenges on Medicaid Minimum Wage

By Jim Saunders, The News Service of Florida

TALLAHASSEE — Three health-care groups this week challenged how the Florida Agency for Health Care Administration is carrying out a requirement that “direct care” workers get paid a minimum of $15 an hour.

The Florida Assisted Living Association, the Florida Ambulance Association and the Home Care Association of Florida filed the challenges at the state Division of Administrative Hearings. The same groups in late September filed a lawsuit in Leon County circuit court to try to block part of this year’s state budget that could open Medicaid providers to litigation if they don’t pay the $15 minimum wage.

The disputes involve budget fine print that directed money to the Agency for Health Care Administration to adjust reimbursement rates so Medicaid providers would pay at least $15 an hour to direct-care employees. Also, the budget said employees could file civil lawsuits against providers that do not pay $15 an hour, including possibly class-action lawsuits.

The three nearly identical challenges filed this week at the Division of Administrative Hearings contend that the agency, which runs much of the Medicaid program, did not use a proper rule-making process to define “direct care” workers who would be affected by the minimum wage. As a result, they argue the agency is using “invalid, unadopted rules” and should be ordered to stop relying on them.

The budget did not provide a definition of direct-care workers, and William Dean Hall, an attorney for the groups, wrote in the filings that “this is not a phrase that is susceptible to one clear definition in all circumstances.”

“Quite clearly, in order to enforce the pertinent provisions of the budget, AHCA must interpret the phrase ‘direct care employee,’” Hall wrote. “This phrase is not equivalent to a common term that has a well-known meaning.”

The three groups represent hundreds of providers that take part in the Medicaid program. As an example, the Florida Ambulance Association challenge said operating “an ambulance service in Florida, especially for local governmental entities, practically requires those providers to service Medicaid patients and participate in that program.”

The lawsuit filed in September in Leon County circuit court is rooted in the $15-an-hour requirement, but it focuses on the constitutionality of the part of the budget that could lead to employee lawsuits if providers don’t comply.

It contends that, under the Florida Constitution, creating such a “legal cause of action” must be done in state law, rather than in the annual budget.

“(The) plaintiffs have a real and imminent concern that the appropriated funds in the budget will not be sufficient to cover the increased salary obligations for ‘direct care employees,’” the lawsuit said. “This underfunded obligation coupled with the potentially crippling new class action liability significantly increases the risks associated with the continued provision of Medicaid services.”

The state had not filed responses to the lawsuit or the administrative challenges as of Friday morning, according to online dockets. Circuit Judge Angela Dempsey has scheduled a Nov. 30 hearing on the groups’ request for a temporary injunction in the lawsuit.

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