Florida Medicaid Providers Beware: You Must Pay Your Employees At Least $15/Hour

On June 2, 2022, Governor DeSantis signed the Freedom First budget for the 2022-2023 Fiscal Year, which provided over $600 million in funding to the Agency for Health Care Administration (the “AHCA”).  The purpose of the funding is to increase minimum wage to at least $15/hour for employees of Medicaid providers, including 1099 employees, who provide services under the increased reimbursement fee schedules.  If those Medicaid providers are not paying their employees at least $15/hour as of October 1, 2022, those providers are at risk of a civil lawsuit by their employees, and a recoupment of funds.

Supplemental Wage Agreement

By this time, all Medicaid providers that bill under the impacted fee schedules should have received notice in the mail from the AHCA with instruction to sign the Supplemental Wage Agreement by October 1, 2022 via the online portal.  The Supplemental Wage Agreement requires that the Medicaid provider agrees, under penalties of perjury, that every employee of the provider will be paid at least $15/hour as of October 1, 2022.

 If a Medicaid provider failed to sign the Supplemental Wage Agreement by the October 1, 2022, deadline, the provider will be subject to audits and a recoupment of funds.

Consequences for Failure To Pay Employees $15/Hour

In addition, beginning January 1, 2023, if an employee of a Medicaid provider subject to the above requirements is not receiving a minimum wage of $15/hour, that employee is entitled to bring a civil action against the Medicaid provider.

If the employee prevails, he or she will be entitled to receive: (i) the full amount of any back wages unlawfully withheld plus the same amount as liquidated damages; (ii) reasonable attorneys’ fees and costs; and (iii) any legal or equitable relief as may be appropriate to remedy the provider’s violation, including without limitation, reinstatement of employment and/or injunctive relief.  In addition, such civil action may be brought as a class action, pursuant to Rule 1.220, Florida Rules of Civil Procedure.

What Medicaid Providers Are Exempt?

 Florida Medicaid providers who bill exclusively under the following fee schedules are exempt from the requirement of signing the Supplemental Wage Agreement and paying their employees $15/hour:

• Behavior Analysis Fee Schedule
• Community-Based Substance Abuse County Match Fee Schedule
• County Health Department Certified Match Program Fee Schedule
• Durable Medical Equipment and Medical Supply Services Provider Fee Schedule for All Medicaid Recipients
• Early Intervention Services Fee Schedule
• Medicaid Certified School Match Program Fee Schedule
• Physician Pediatric Surgery Fee Schedule
• Prescribed Drugs Immunization Fee Schedule
• Prescribed Drugs Physician Administered Billing Codes
• Regional Perinatal Intensive Care Center (RPICC) Neonatal Services Fee Schedule
• Regional Perinatal Intensive Care Center (RPICC) Obstetrical Services Fee Schedule
• Targeted Case Management for Children at Risk of Abuse and Neglect

 Conclusion

Medicaid providers who are not exempt must comply with the above requirements and deadlines.  Failure to do may result in severe consequences, including civil liability.  If Medicaid providers have any questions relating to their obligations, they can submit questions to the AHCA through their online portal.