Florida would start moving to a statewide system of Medicaid managed care by the end of this year and would try to put strict limits on how much tax money goes into the program, under a wide-ranging Senate bill released this morning.

The 202-page bill would carve the state into 19 regions and use HMOs and other types of managed-care plans to oversee services for the vast majority of Medicaid beneficiaries.

Senate Health and Human Services Appropriations Chairman Joe Negron, R-Stuart, said the new managed-care system could be operating in heavily populated areas early next year. It would have to be fully in place for most beneficiaries by Dec. 31, 2012; for people needing long-term care, the deadline would be March 31, 2013.

Senate leaders also included a nuclear option if the federal government doesn’t go along with the proposal: The bill calls for the state to begin running the program itself — forgoing billions of dollars in federal funding — on Dec. 31 if Washington doesn’t approve.

Negron said he is confident the Obama administration will reach agreement with the state and cited a decision this week in which federal officials allowed Arizona to cut Medicaid services.

“We’re going to ask for flexibility,” said Negron, the chief architect of the bill. “We’re not asking to do outrageous things. We’re asking to do common-sense things.”

But Senate Minority Leader Nan Rich, D-Weston, said the state needs to be willing to compromise with the federal government and warned of a “crisis” if the state actually takes control of the program. She estimated the move could cost the state as much as $12 billion a year in federal funding, based on budget estimates for the 2011-12 fiscal year.

The bill touches on a variety of hot-button issues in the Medicaid program and will spur a debate that lasts throughout the spring legislative session. Senators also will have to reach agreement with the House, which passed a different Medicaid overhaul plan last year.

Legislative leaders and Gov. Rick Scott vow to rein in the $20 billion program, which they blame as a major factor in the state’s budget problems.

The bill takes numerous steps to try to control costs. As an example, it would place a strict limit each year on how much money can be spent on Medicaid and calls for cuts if spending looks like it would go over those limits during the middle of a year.

“We’re going to decide how much we spend on Medicaid,” Negron said during a meeting this morning. “We’re the appropriators.”

The bill also would put more costs on Medicaid beneficiaries, including requiring many to pay $10-a-month premiums. Beneficiaries who use emergency rooms for non-emergency services would get hit with $100 charges.

“People are showing up in emergency rooms for things a reasonable person knows is not an emergency,” Negron said.

But Sen. Eleanor Sobel, D-Hollywood, questioned how it would be determined whether a person has an emergency condition — and whether they would get hit with the $100 charges.

The bill would create a bidding-type process for choosing managed-care plans to operate in the 19 regions. Along with HMOs, it anticipates using such things as provider-service networks, which can be local networks of hospitals and other types of medical professionals.

The proposal would require managed-care plans to sign five-year contracts and includes provisions aimed at holding them accountable. For instance, it would require that plans spend 90 percent of the money they receive on patient care — a concept generally known as a medical-loss ratio. Such ratios are controversial.

In including long-term care in the new system, however, the bill backs a longstanding priority of the managed-care industry.

People currently in nursing homes would not be placed in managed care. But other seniors would be enrolled in managed care, with the goal of providing services that would help them continue to live in their residences.

The Senate bill, however, does not include managed care for people with “developmental” disabilities such as autism and Down syndrome. Proposals to include such people in managed care have touched off opposition from providers and advocates.

Florida currently has a pilot program that requires managed-care enrollment for most Medicaid beneficiaries in Broward, Duval, Clay and Baker counties. But the Senate bill — along with the House bill last year — would be dramatic expansions of that program.

–Health News Florida Capital Bureau Chief Jim Saunders can be reached at 850-228-0963 or by e-mail at jim.saunders@healthnewsflorida.org.