News

By Mark Sherman and Ricardo Alonso-Zaldivar, Associated Press/from Miami Herald

The Supreme Court has several options in ruling on President Barack Obama's health care overhaul, from upholding the law to striking it down in its entirety. The court also could avoid deciding the law's constitutionality at all, if it finds the lawsuits challenging the law are premature.
Here is a look at six potential outcomes, from the simplest to the most complicated possible rulings:

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Q. What if the Supreme Court upholds the law and finds Congress was within its authority to require most people to have health insurance or pay a penalty?

A. A decision in favor of the law would end the legal fight and allow the administration to push forward with implementing its provisions over the next few years, including the insurance requirement, an expansion of Medicaid and a ban on private insurers' denying coverage to people with pre-existing health problems.

The political wrangling, however, probably would continue as Republican candidates for president and lesser offices are calling for repeal of the law.

Q. What if, on the other hand, the court strikes down the entire law?

A. That would kill a costly new federal entitlement before it has a chance to take root and develop a constituency of beneficiaries and supporters, namely more than 30 million people who are supposed to wind up with health insurance because of the law.

In addition, some parts of the law already are in effect and would be rolled back. One popular provision allowing young adults to stay on their parents' insurance until age 26 has added nearly 2.5 million people to the coverage rolls, at no cost to taxpayers.

But there's no escaping America's double-barreled problem of excruciatingly high health care costs and many uninsured people, more than 50 million according to the latest estimates.

Whether it's dealing with the federal deficit, retirement security for seniors or even the Pentagon budget, elected officials would still have to confront health care at nearly every turn.

Congress would get to roll the ball up the hill again.

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Q. What happens if the court strikes down the individual insurance requirement, but leaves the rest of the Affordable Care Act in place?

A. Knocking out the requirement that Americans carry insurance would not be the end of Obama's health care overhaul. There's a lot more in the 900-plus pages of the law.

But it would make the complicated legislation a lot harder to carry out, risking more complications for a U.S. health care system already seen as wasteful, unaffordable and unable to deliver consistently high quality.

Many fewer uninsured people would get covered. Ten million to 15 million people intended to get coverage under the law could be left out.

The cost of individually purchased private health insurance would jump. That would make it more expensive for the government to subsidize premiums, although millions of middle-class people would still be entitled to such assistance under the law's remaining provisions.

If the individual mandate is struck, the law's Medicaid expansion would still cover millions more low-income people, mainly childless adults.

And a host of other mandates would stay in place. Starting in 2014, medium-sized and large employers would be hit with fines for not providing coverage to their workers.

Insurance companies would be required to accept people with pre-existing medical problems, no longer allowed to cherry-pick the healthy to keep costs down. They would also be forbidden from imposing higher premiums on people in poor health, and limited in what they could charge older adults.

If that happens, premiums in the individual health insurance market would jump anywhere from 10 percent to 30 percent, according to various forecasts from economists.

Experts debate whether or not such a cost spike would trigger the collapse of the insurance market for individuals and small businesses - or just make coverage even more expensive than it already is.

"Without a mandate the law is a lot less effective," said MIT economist Jonathan Gruber, who advised the Obama administration and, earlier on, then-Massachusetts Gov. Mitt Romney, who put such an insurance mandate in that state's health care law. "The market will not collapse, but it will be a ton more expensive and cover many fewer people."

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Q. What if the court strikes down the mandate, and invalidates the parts of the law that require insurance companies to cover people regardless of medical problems and limit what they can charge older people?

A. Many fewer people would get covered, but the health insurance industry would avoid a dire financial hit.

Insurers would be able to keep screening out people with a history of medical problems, such as diabetes patients or cancer survivors.

That would prevent a sudden jump in premiums. But it would leave consumers with no assurance that they can get health insurance when they need it, a major problem the law was intended to fix. Other economically developed countries guarantee health insurance for their citizens.

A related requirement limits premiums charged to older adults. Currently people in their late 50s and early 60s can face premiums as much as six or seven times higher than those charged to 20-year-olds. The law says insurers may charge older adults no more than three times what they charge younger ones.

Administration lawyers say the insurance requirement goes hand in hand with the coverage guarantee and cap on premiums, and have asked the court to get rid of both if it finds the mandate to be unconstitutional.

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Q. What happens if the court throws out only the expansion of the Medicaid program?

A. Throwing out the expansion would severely limit the law's impact because roughly half the more than 30 million people expected to gain health insurance under the law would get it through the expansion of Medicaid, the federal-state health insurance program for low-income people.

The law would effectively bring under Medicaid everyone making up to 138 percent of the federal poverty level. That works out to about $15,400 for an individual, $30,650 for a family of four. Most of those who would be added to the Medicaid rolls are low-income adults without children.

But a potentially sizable number of those low-income people might still be eligible for government-subsidized - though probably more expensive - private insurance under other provisions of the law. Private coverage will probably be more expensive for taxpayers to subsidize than Medicaid.

States suing to overturn the federal law argue that the Medicaid expansion comes with so many strings attached it amounts to an unconstitutional power grab by Washington, reaching directly into the wallets of state taxpayers.

The administration counters that the federal government is paying all of the initial cost of the expansion, and 90 percent in perpetuity, well above what Washington contributes for regular Medicaid. Moreover, when Congress created Medicaid in 1965 it also served notice on the states that program rules could change in the future. This is only the latest of many such changes.

The Supreme Court took on this issue even though none of the district or appeals courts that heard health care lawsuits had any problem with the Medicaid expansion.

"We don't have any lower court that has struck down this (Medicaid) provision, so there is no precedent from the lower courts on how to handle it," said Diane Rowland, a Medicaid expert with the nonpartisan Kaiser Family Foundation. "They all upheld it."

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Q. What happens if the court decides that the constitutional challenge is premature?

A. The wild card, and least conclusive outcome in the case, involves the court's consideration of a technical issue. The federal appeals court in Richmond, Va., held that the challenge to the insurance requirement has to wait until people start paying the penalty for not purchasing insurance. The appeals court said it was bound by the federal Anti-Injunction Act, which is intended to facilitate tax collections and keep the government operating. That law says federal courts may not hear challenges to taxes, or anything that looks like a tax, until after they are paid.

Both the challengers and the administration have urged the justices to decide the constitutional issues now. But if the court were to take this path, most of the six hours of argument time, thousands of pages of legal briefs and ample legal fees devoted to this case would be wasted.

Although the administration says it doesn't want this result, such a decision would allow it to continue putting the law in place and force postponement of any subsequent challenge until more of the benefits are being received. On the other hand, Republicans might have more ammunition to press for repeal of the law in the meantime.

By Tia Mitchell, Herald/Times Tallahassee Bureau

State Attorney General Pam Bondi demoted the head of her Medicaid fraud investigative unit and fired another top staffer this week, citing reports of poor leadership and employee discontent.

Patrick Kelly, the Medicaid Fraud Control Unit's chief of law enforcement investigations, was fired Wednesday. Unit director David Lewis was also removed from his position, though he will continue to work in the Attorney General's Office.

The personnel changes are the result of a "strategic review" that pinpointed Kelly and Lewis as the source of many of the unit's issues, though neither was accused of any wrongdoing.

"I believed that the Medicaid Fraud Control Unit could perform much better, and I requested a thorough review of the unit," Bondi said in an email Thursday. "The results of the review confirmed that changes needed to be made in order to ensure that the Medicaid Fraud Control Unit serves Floridians as well as possible."

The review, dated Feb. 13, concluded that "a culture of passive aggressive management exists at the top" of the unit. It singled out Lewis and Kelly, saying their management styles lead staff to fear retribution for speaking up.

The report also said there were too many positions left vacant, inadequate training, poor coordination with the Agency for Health Care Administration and ongoing discontent in the unit's Miami office, its busiest.

Reviewers also accused Kelly of tampering with the investigation by calling staff members prior to their interviews with the review team. The report suggested that both Kelly and Lewis be replaced.

ewis, 56, could not be reached for comment. Kelly, 55, said he was brought in by former Attorney General Bill McCollum as a "change agent," which made him unpopular at times.

"Anytime you change an organization there are some people who are uncomfortable," he said.

Oscar Gelpi, who was previously assigned to the Fort Lauderdale branch of the Office of Statewide Prosecution, will serve as interim director of the Medicaid fraud unit, which has eight offices. The division investigates and prosecutes cases regarding the misuse of Medicaid funds, corruption, or abuse and neglect in long-term care facilities.

Although the Medicaid fraud unit has been credited with recovering hundreds of millions of dollars, management concerns have also plagued the division over the years.

Kelly and Lewis were among four employees suspended without pay in 2009, after they were accused of drinking "sips of whiskey" at a state-run police academy during working hours. Kelly was also cited for using his state-issued vehicle improperly.

That was before Lewis was promoted to the top position, where he made $105,000 annually. Kelly's salary was $95,000.

The unit's productivity became a campaign issue during the 2010 gubernatorial race, as Democrat Alex Sink pointed out that the number of prosecutions had dropped under McCollum.

Bob Butterworth, who served as attorney general from 1987 to 2002, was accused of ignoring or botching major Medicaid fraud cases because he allowed the unit to focus on individual patients who bilked the system instead of corporations. Butterworth took over Medicaid fraud investigations from the state Auditor General's office in 1994.

At one point, the U.S. Department of Health and Human Services put the fraud office on probation, saying the state had done too little to root out major cases.

Tia Mitchell can be reached at tmitchell@tampabay.com or (850) 224-7263.

U.S. Department of Health and Human Services NIH News

Language, motor deficits, seen within months of starting treatment

Infants and toddlers who have been treated for cancer tend to reach certain developmental milestones later than do their healthy peers, say researchers at the National Institutes of Health and in Italy.

The findings show that delays may occur early in the course of treatment and suggest that young children with cancer might benefit from such early interventions as physical or language therapy.

Compared to children who had not had cancer, children treated for cancer before age 4 progressed more slowly in vocabulary, cognitive functions such as attention and memory, and motor skills. However, having cancer did not appear to affect children’s social and emotional development. Their ability to respond to their parents was comparable to that of their peers who did not have cancer. Also unaffected by cancer was the ability to engage in make-believe play, such as pretending to pour and serve tea, which typically develops between 12 and 18 months of age.

The current study is the first to document, prospectively, the potential effects of having cancer on young children’s development, enrolling the children after their diagnosis and testing them after they had received treatment. Previous studies have attempted to discern the influence of childhood cancer many years after the cancer had gone into remission?in adolescence or beyond.

“In the early years, when children go through such tremendous growth, they arguably are more sensitive to biological and environmental influences than adults are,” said first author Marc H. Bornstein, Ph.D., head of Child and Family Research at the Eunice Kennedy Shriver National Institute of Child Health and Human Development (NICHD), the NIH institute that collaborated on the study. “Our intent was to assess how cancer might affect a child’s quality of life.”

In recent years, survival rates for many types of childhood cancer have increased, Dr. Bornstein said. For this reason, quality of life for young cancer survivors is a major concern.

Dr. Bornstein conducted the research with NICHD colleagues Diane L. Putnick, Ph.D., and O. Maurice Haynes, Ph.D.; Sara Scrimin, Ph.D., Fabia Capello, Modesto Carli, M.D., and Marta Pillon, M.D., of the University of Padova in Italy; and Simona de Falco, Ph.D., of the University of Trento, also in Italy.

Their findings appear online in the Journal of Pediatric Psychology.

The researchers evaluated 61 children between 6 months and 3.5 years old. All were being treated for tumors or cancers of the blood when they entered the study. The children averaged 19 months old at diagnosis, and had received an average of three months of treatment at the time the researchers evaluated their cognitive and emotional development.

Pediatricians evaluated all of the children to ensure they were well enough to participate in the testing. Experts familiar to the children and their families then conducted a series of assessments to evaluate the children in several areas of development:

• Their ability to understand language and to express themselves, for example, by identifying a toy by name
• Their cognitive abilities on an age-appropriate battery of tests, including attention, memory, problem-solving and the ability to classify objects
• Gross motor skills (their ability to sit up, crawl or walk) and fine-motor skills (the ability to control precise movements, like using a spoon)

The researchers also videotaped the children and their mothers while they engaged in play. The researchers reviewed the video and gauged children’s social and emotional development by rating their responsiveness to and involvement with their mothers, exploration of new toys, and ability to engage in make-believe play. Mothers also responded to questions about their child’s language ability and behavior at three points in time: one month before, one week before and on the day of the cognitive, motor and social/emotional testing.

The cancer survivors did not score as well on tests of language, cognition and motor milestones as did children who did not have cancer. In terms of developmental averages, children with cancer were about 7 points below average on tests of mental development, and 14 points below average on motor tests.

“It’s important to stress that we documented a broad range of scores,” Dr. Bornstein said. “Every child’s experience is different. Some were nearly on target for achieving milestones, some were far behind. The key message, however, is that parents and health care professionals should realize that such delays are a real potential, and they should be factored into decisions on the care a child receives.”

The researchers found no differences between the groups in terms of social and emotional development.

“We’ve demonstrated that the impact of the disease and its treatment can appear early on,” Dr. Putnick said. “It suggests that the earlier health care providers start addressing these concerns, the better.”

For example, a child who finds language difficult may grow frustrated and stop trying to learn, she explained. In this way, early deficits can snowball and hinder improvement over time.

In addition, caregivers often wait until the cancer is in remission before addressing other concerns. These findings suggest that future studies are needed to determine if early intervention?even as soon as the first round of treatment is completed?might be helpful, Dr. Putnick said.

The evidence further indicates that there might be advantages to engaging young cancer survivors in therapy through social interaction. One approach worth exploring is to provide instruction to parents on how to engage children in language, for example, instead of recommending visits to a center for therapy, Dr. Putnick said.

By David Royse, The News Service Of Florida

THE CAPITAL, TALLAHASSEE, March 8, 2012……Businesses would see a much smaller increase in their unemployment compensation tax because the state would take longer to pay back a loan to Washington under legislation passed Thursday by the House and sent to Gov. Rick Scott.

The tax paid by businesses for unemployment benefits was scheduled to go up to about $171 per employee, but if signed into law, the bill (HB 7027) would reduce that to about $121 per worker.

“If you believe in job creation, you must support this,” Rep. Doug Holder, R-Sarasota, said before the House voted 108-11 in favor of the bill, with a Senate amendment that included the main provision.

When unemployment claims spiked in Florida as the economy tanked, the unemployment compensation trust fund dropped into the red and Florida had to borrow money from the federal government to pay jobless benefits.

The bill would delay the state’s repayment schedule, stretching it out to five years instead of three. That will mean the state’s employers will eventually be on the hook for more interest, but the bill’s sponsor in the House, Rep. Mike Horner, said it was a small price to pay down the road to avoid a much larger hit now.

The measure also reduces the wage base for calculating the unemployment tax from $8,500 to $8,000 per worker.

Together, the changes would save businesses $800 million over three years, said Horner, R-Kissimmee.

In 2011, businesses paid about $72 per employee for unemployment, so the tax will still increase, but the savings of about $50 per worker over the projected increase will make a big difference, business groups said.

“This tax reduction will have a direct impact on Florida jobs, allowing businesses to avoid a major cost increase and maintain payrolls,” said Rick McAllister, CEO of the Florida Retail Federation.

Some members, however, said they were disappointed that the state would be just putting off paying back Washington. Eventually, that cost will hit employers, they said.

“We’re just kicking the can down the road,” said Rep. Franklin Sands, D-Weston.

Note from Alisa Snow: Many therapy providers have been required by the state Agency for Health Care Administration, through its Medicaid Program Integrity office, to return hundreds of thousands of dollars in “overpayments” due in part to a glitch in the fiscal agent computer system.

Below is an article about a similar problem experienced by counties. A proposed bill in the Florida Senate would force counties to pay back the money, without much recourse.

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Editorial, South Florida Sun-Sentinel

What began as a dispute over Medicaid billing is wrongly mushrooming into a budgetary nightmare for the state’s 67 counties. If the Florida Senate gets its way, and it should not, the state will start withholding millions of dollars in revenue-sharing money from the counties in order to collect contested bills.

Doing so would amount to garnishment in an effort to force county governments to pay back disputed bills for nursing home and long term hospital stays. Unfortunately, four years ago, a change in the way the state bills the counties for Medicaid payments has resulted in a number of duplicative charges and incorrect billings that have county officials seeing red.

County officials have tried to work with officials at the state Agency for Healthcare Administration and the Florida Department of Revenue to resolve the billing errors. But with the introduction of SB 1988, it seems the state is more interested in collecting money than correcting its billing errors. That’s not helpful.

If the bill becomes law, the state will begin withholding more than $300 million annually in revenue-sharing payments earmarked for county governments, beginning July 1. The figure amounts to a roughly $148 million a year hike in what the 67 counties currently pay the state for Medicaid.

Broward County, for example, would see roughly $30 million withheld, including $6.7 million in garnishments, plus an estimated $23.3 million in new charges, which the state presumes is 100 percent accurate. In Palm Beach County, about $18.3 million will be withheld by the state, and that figure includes $2.6 million in disputed past charges along with an estimated $15.7 million in new payments.

No longer will the state simply send out bills in a process that allows counties the opportunity to evaluate and, if necessary, dispute questionable charges. Once SB 1988 becomes law, the new withholding process becomes permanent.

So, if a county is wrongly billed because the receiver of Medicaid services lives in another county, too bad. If a bill seeks payment for a person long ago deceased, no matter. The county’s only recourse in resolving dubious bills is to seek a refund by proving the state made the mistake. Don’t hold your breath.

Clearly, there’s a problem with incorrect billing. Ideally, state budget and Medicaid officials should be able to reach some agreement with the counties to ensure that more accurate bills are dispensed from Tallahassee, which would reduce the number of disputes and hasten full payments. That’s the sensible, adult way to resolve the problem.

SB 1988 offers neither correction nor partnership, just simple coercion to a flawed billing process. The bill’s provisions should not be part of a new state budget.

The Legislature should scuttle the withholding provisions in SB 1988 when lawmakers from the Florida House and Florida Senate meet in the upcoming budget conference. Barring that, Gov. Scott would have no choice but to veto the budget.

By Cheryl Clark, for HealthLeaders Media

Kaiser Foundation Health Plan is illegally denying some of its California enrollees physical, speech and occupational therapy services, says a cease and desist order filed Monday by the state.

According to the order, Kaiser “categorically denies coverage” for these services on the basis that certain enrolleess do not have a physical condition or physical impairment that triggers the coverage, and does not provide these patients with a medical necessity review, says the Department of Managed Health Care, which regulates managed care plans serving 21 million lives.

California’s Knox-Keene Act specifies that speech therapy, physical therapy and/or occupational therapy “are required basic health services, and therefore Kaiser’s denial of coverage for physical therapy, speech therapy, and/or occupational therapy based on a lack of physical impairment is illegal and contrary to the Act,” the order says.

The written order, as filed, says that Kaiser denied these services with written letters of denial to at least 70 enrollees since 2009. An agency spokeswoman said on Tuesday that the number is now up to 106. Kaiser has at least eight million enrollees in the state.

The DMHC subjected those 70 cases to an independent medical review for evaluation of medical necessity of the requested therapy services. That review found that in excess of 75% of the cases the services indeed were medically necessary, and 10% were not. The remainder are still under review.

Yet, the order says, “Kaiser continues to illegally deny enrollee requests seeking services for physical therapy, speech therapy, and/or occupational therapy.”

“The DMHC is taking this action to ensure Kaiser follows the law,” DMHC’s chief of enforcement, Anthony Manzanetti, said in a public statement. The order says that Kaiser’s actions violate eight provisions of state law, health and safety codes or codes of regulation.

John Nelson, a spokesman for Kaiser Permanente, responded to a HealthLeaders Media query by e-mail:
“We are surprised and disappointed with the DMHC’s announcement. We have been in discussions with the Department over these services and were already scheduled to continue our discussions later this week.
“The Department appears to have misunderstood or mischaracterized Kaiser Permanente’s approach to providing speech, physical, and occupational therapy to our members. Kaiser Permanente provides these clinical and medical therapies to our patients. These therapies are not limited only to patients with “physical conditions.”
“We remain committed to discussing DMHC’s position with them and reaching a shared understanding. In the interim, we will continue to cover medically necessary health care services.”

In California, consumers have the right to appeal a health plan’s refusal to provide medically necessary health care services. They also have the right to receive an independent medical review if they disagree with the plan’s decision.

The order says that the state’s code of regulations provides that the DMHC may impose administrative penalties on a plan when it finds the plan “engages in a practice of mischaracterizing determinations substantially based on medical necessity coverage decisions, or otherwise interferes with the rights of an enrollee to obtain independent medical review.”

South Florida Business Journal by Brian Bandell, Senior Reporter

UnitedHealth Group announced separate deals to acquire Miami-based Preferred Care Partners and Coral Gables-based Medica HealthCare Plans.

The deal will give Minnesota-based UnitedHeath (NYSE: UNH) about 85,000 more Medicare Advantage and 12,200 more Medicaid HMO members across Florida, plus eight primary care centers in South Florida. The companies did not announce the financial terms of the deals.

According to Florida data, UnitedHealth’s HMO had 26,853 Medicare Advantage enrollees statewide as of Sept. 30. The acquisition would push that to nearly 112,000 and give UnitedHealth ownership of the second-largest Medicare HMO in Florida.

The largest Medicare Advantage HMO plan in Florida is Humana, with 254,957 members. Humana also has 68,669 members in its CarePlus affiliate.

Looking at federal data on Medicare Advantage enrollment in both HMO and other plans in Florida, UnitedHealthcare had 234,000 members before the deal while Humana had 394,000 members.

On the Medicaid HMO side, UnitedHealth had 118,337 Florida members on Sept. 30, making it the third-largest plan in the state. The acquisition would not be enough for it to immediately catch leaders WellCare/HealthEase and AmeriGroup Florida. However, the Florida Legislature passed a bill in 2011 that calls for most Medicaid enrollees to join an HMO in the coming years.

UnitedHealth spokesman Matthew A. Burns said the two HMOs in the deals would remain separate from UnitedHealth’s HMO during 2012, with no changes expected for their members. Integration plans will be developed over the long term. He noted that Florida regulators must approve the deals.

More deals for Medicare and Medicaid plans in Florida will likely follow this, said Minneapolis-based HMO analyst Allan Baumgarten, who published an annual report on Florida HMOs. The big Medicare and Medicaid plans have strong opportunities for profitable growth but many of the smaller ones are struggling, he added.

These two acquisitions would make UnitedHealthcare a more formidable opponent for Humana in Florida, he said.

“Preferred Care has been moderately profitable and has had strong enrollment growth,” Baumgarten said. “Medica has been slightly profitable, but has had good enrollment growth.”

Privately owned Preferred Care Partners has about 50,000 Medicare HMO members, 5,000 Medicaid HMO members and six health clinics. According to state data, it earned $2.6 million on premiums of $435.6 million in the first nine months of 2011.

Most of Preferred Care Partners’ members are in Miami-Dade County, but it also has members in Broward, Marion, Sumter, Lake, Hillsborough, Pinellas and Manatee counties. It has six primary care centers in Miami-Dade.

“Partnering with UnitedHealthcare will enhance our ability to serve our members,” Preferred Care founder and CEO Joseph Caruncho said in a news release. “Combining UnitedHealthcare’s resources, innovation and technology with our company’s local market strength, experience and physician relationships will create a powerful organization dedicated to helping Medicare beneficiaries live healthier, more secure lives.”

Preferred Care Partners said it was advised in the transaction by Wells Fargo Securities and Ferrer Freeman & Co., which is also a significant investor in the company.

Medica has about 35,000 Medicare Advantage members, 7,200 Medicaid HMO members and two medical centers. All of its enrollees are in Miami-Dade and Broward counties. The private company owns two HMOs - one for Medicare and one for Medicaid.

In the first nine months of 2011, Medica’s Medicare HMO earned $5.5 million on premiums of $429.9 million, and its Medicaid HMO lost $386,324 on premiums of $21.2 million, according to state data.

“Preferred Care and Medica each combine a strong record of providing quality, affordable health care coverage to Floridians with solid relationships with physicians and other health care providers,” UnitedHealthcare CEO Gail Boudreaux said in a news release. “Joining these strengths with UnitedHealthcare’s record of practical health innovation will bring greater health care access and value to Floridians and the health care community that serves them.”

y Gary Fineout, Associated Press, Reporter Bill Kaczor contributed to this story.

TALLAHASSEE, Fla. undefined It’s almost becoming an annual rite each year in Tallahassee: Another year, another billion-dollar plus budget shortfall.

Florida lawmakers head into their annual session in January confronted by a nearly $2 billion gap. This time around it is primarily caused by an unenviable combination of growing expenses in safety net programs such as Medicaid at the same a sluggish economic recovery is expected to keep tax dollars from growing significantly.

In the last several years, as the recession has taken its toll on the state’s battered real estate market and unemployment soared into double digits, the Republican-controlled Legislature has tried nearly every way to balance the state budget. They’ve cut spending, they’ve eliminated state workers, they’ve relied on billions in federal stimulus dollars and one year they even raised taxes.

This coming session legislative leaders and Gov. Rick Scott have already ruled out one option: Raising taxes or fees as a way to help balance the budget. That means lawmakers will instead have to come up with another round of cuts.

“There’s no easy choices in this budget year,” said House Speaker Dean Cannon, R-Winter Park. “It’s a tough budget year and there’s no magic bullet.”

The governor has already given lawmakers his own recommendations that will likely be used as a building block for the final budget.

Despite the shortfall Scott has come up with own $66.4 billion spending plan that would significantly boost spending on schools by making steep cuts in what the state spends reimbursing hospitals to take care of patients enrolled in Medicaid. He also wants to shut down a handful of state prisons and eliminate some 4,500 state jobs.

The governor’s second set of budget proposals are dramatically different from the one he offered shortly after was he first sworn into governor.

Scott in early 2011 called for a 10 percent cut for education, as part of a “jobs budget” that also called for nearly $2 billion worth of tax cuts as part of his push to jumpstart the state’s economy.

Scott now says he’s heard from Floridians that they want more money spent on education so he is pushing a budget that would boost public school spending by roughly $1 billion. His tax cut proposals, meanwhile, have been dramatically scaled back. This year Scott is calling for a modest change in the state’s corporate income tax and a tax break for companies purchasing machinery and equipment that together would cost roughly $30 million.

Scott also hinted that he was willing to veto the entire budget - and force lawmakers to do it over - if they approve a budget that did not include a significant increase for schools.

Initially the governor was unwilling to say what a “significant” increase is, but he also says he likes what he recommended.

“I think the right number is a billion dollars,” Scott said.

Scott’s budget proposal drew a sharp response from Democratic legislators who accused the governor of pitting seniors and prison guards against teachers. The move also drew fire because the Medicaid cuts would fall hardest on not-for-profit hospitals. Scott led the nation’s largest chain of for-profit hospitals in the 1990s until he was forced out amid a probe into Medicare fraud.

But Senate President Mike Haridopolos, R-Merritt Island, has called Scott’s overall budget “very much reflective of what the Senate will be pursuing this year.”

State employees could also find themselves getting targeted for budget cuts once again.

Last spring legislators forced public employees to start paying for a portion of their pension costs as a way to cover a nearly $4 billion shortfall.

Now legislators may go after state worker health care benefits as a potential source of savings. The state is spending nearly $1.9 billion on health care benefits for state workers, with about $1.45 billion coming from taxpayers.

The Scott administration earlier this year already negotiated new contracts with health maintenance organizations that limited the number of HMOs available for state workers and is expected to save the state more than $350 million over the next two years.

The governor, who currently pays $30 a month to cover himself and his wife, also has recommended that all state employees pay the same for health insurance. That’s a move that would affect roughly 30,000 state workers, including Scott, his agency heads, managers and state legislators.

Rank-and-file state workers pay $50 a month for individual coverage and $180 a month for family coverage. Scott’s push to require everyone to pay that rate would increase health insurance premiums for some employees by $1,800 a year for family coverage.

This would save close to $50 million.

But Sen. J.D. Alexander, R-Lake Wales and the Senate budget chief, has been looking at whether the state should revamp the types of coverage it offers state workers as both a way to save money - and as a way to encourage state workers to stay healthier.

“When you go out and make a $5 copay, it’s real easy to be out of sight and out of mind what the real bill is,” Alexander said.

Alexander added “if we are going to spend $2 billion, I want to spend that $2 billion to get the best possible deal we can for the people.”

State legislators normally pass their budget during their annual 60-day session, which usually starts in March. But this year’s session begins Jan. 10 because the Legislature must also pass new maps for legislative and Congressional districts.

Haridopolos, citing fears of a “topsy-turvy” economy, has thrown out the idea of delaying a final vote on the budget until later in the year. The state’s fiscal year doesn’t start until July 1. He says that by waiting, legislators will have a better idea of knowing if the economy is truly recovering. That could change how much money lawmakers have to cut.

“I am very reluctant to pass a budget with numbers that are uncertain,” Haridopolos said.

Cannon, however, doesn’t want to come back in a special session later in the year and doesn’t think there will be large enough swings to justify waiting.

“I find it highly unlikely that in two-months’ difference we would see some massive increase in revenues,” Cannon said.