TALLAHASSEE -- Gov. Rick Scott will veto a 3 percent increase in Florida college tuition Monday and approve $65 million in extra Medicaid funding to hospitals that provide tens of millions in uncompensated care to the poor.
As Scott signs a record $74.5 billion budget before leaving for a trade mission to Chile, his rejection of a tuition increase was expected. He has criticized the idea for months, calling it a "tax" on middle-class families.
Scott's veto message: Florida should be proud its tuition is lower than most states and students should be able to earn degrees and find jobs without being saddled with "massive debt."
The veto could draw a legal challenge from the Legislature.
Tuition is technically not a line item subject to a veto, but is wedged into the budget as proviso language tied to an appropriation that Scott will not veto.
Former Gov. Charlie Crist took similar action in 2007, and lawmakers didn't challenge it in court.
Seeking to build a case for a veto, Scott's office asked state university presidents to sign a letter saying they do not want more tuition revenue this year. University leaders collectively decided not to sign the letter, and balked at getting in the middle of a fight between Scott and House Speaker Will Weatherford, R-Wesley Chapel, who led the charge for a tuition hike.
Nevertheless, universities never planned on the additional tuition revenue, worth about $18 million, in anticipation of Scott's veto. Regardless, by law, tuition will automatically rise 1.7 percent to keep up with inflation.
In a statement, Weatherford said he would continue to work with university presidents and the state Board of Governors to move the university system "forward to the benefit of our students."
"The rumor that the Governor will veto tuition increases tomorrow is not a surprise," he said in Sunday's statement.
The state's largest hospitals were relieved to learn Scott will not spike $65 million aimed at easing the transition to a new Medicaid payment system. In return, hospitals agreed not to ask for more such money next year.
In Manatee County, trauma center Blake Medical Center in Bradenton reported total uninsured uncompensated care costs of $76.2 million, and received payments of $16.3 million.
Manatee Memorial Hospital also handles Medicaid cases. It received $6.9 million for indigent care costs last year compared with $30 million in uncompensated care costs, according to figures e-mailed by the hospital to the Bradenton Herald.
The Department of Health and Human Services now sends about $11.6 billion a year to states to distribute to hospitals -- such as Manatee Memorial Hospital -- that treat large numbers of uninsured and Medicaid patients.
The health care law called for cuts in those payments under the assumption many previously uninsured patients would enroll in insurance programs under the new health care law. Hospitals would no longer be treating so many uninsured patients so federal compensation would also drop.
Florida's Legislature this spring declined to accept $51 billion in federal funds over 10 years to expand Medicaid, which could have covered more than 1.1 million uninsured individuals in the state.
Safety net hospitals lobbied heavily for the transition money, saying a new payment system, known as DRG for diagnosis-related groups, caused massive cuts in Medicaid funding. The House insisted on including transition dollars and the Senate agreed to the $65 million.
Scott's office hinted to hospitals last week that he would reject the money and in response they ramped up their lobbying. Those familiar with the governor's rationale said he felt the formula should stand as is, without consideration for winners and losers.
After hearing from hospitals and their advocates, Scott backed down, but not without obtaining concessions from the hospitals that the funding would last for one year. About 20 hospitals sent letters to Scott pledging to reject additional transition dollars next year, many using a form letter.
"Since these funds are intended to mitigate the cost of transition, I will request elimination of the recurring appropriation in the 2014-2015 state fiscal year if you approve the funding for the upcoming state fiscal year," most letters said.
When he signs the budget Monday, Scott will talk about increased transparency and accountability with the DRG system, which pays hospitals according services they provide and the complexity of a patient's condition, rather than the length of their hospital stays. It's similar to how the federal government pays hospitals for Medicare.
Hospitals may have had an easier time agreeing not to ask for more transition money next year because starting in October 2014, they may no longer be relying on the state for Medicaid funding. That's when Florida anticipates switching to a statewide managed care system, where HMOs will oversee Medicaid patients and their care. The state will pay the managed care companies, who in turn will pay hospitals.
Monday's budget signing will take place in Tallahassee and will be the first time Scott will take such action in the capitol.
Two years ago, he signed the budget at a private event at The Villages, a Central Florida retirement community, at which Tea Party members waved signs of support and Democrats were barred from attending.
Last year, Scott signed the budget at an elementary school in suburban Jacksonville to highlight a $1 billion increase in spending for schools. The governor handed unusual souvenirs to first-graders: Sharpie pens that write in indelible ink.