Interoffice Memorandum
DATE: August 27, 2025
TO: Mayor Jerry L. Demings and County Commissioners
THROUGH: Raul Pino, MD, MPH, Director
FROM: John Goodrich, Deputy Director
CONTACT: Sandra D. Roe
PHONE: 407-836-7611
DIVISION: N/A
ACTION REQUESTED:
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Approval and execution of Directed Payment Program Letter of Agreement by and between Orange County LPPF and the State of Florida, Agency for Healthcare Administration in the amount of $585,344,138.
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PROJECT: N/A
PURPOSE: On August 24, 2021, the Board adopted Ordinance No. 2021-35, authorizing the Local Provider Participation Fund (LPPF) to provide an opportunity to narrow the gap on hospitals' unreimbursed Medicaid costs by having the County generate funding as a portion of Florida's non-federal share of Medicaid funding, making available additional federal dollars for reimbursement. The funding is generated through the imposition of a non-ad valorem special assessment on properties owned by private for-profit and not-for-profit hospitals providing in-patient services.
On July 1, 2025, the Board approved the current assessment rates: 2.92 percent of net inpatient revenue and 1.66 percent of gross outpatient revenue. The proceeds of this assessment are collected by the County and remitted to the Florida Agency for Health Care Administration (AHCA) as the non_federal match for the Directed Payment Program (DPP). These funds are then matched with federal funds and returned to local hospitals via an enhanced Medicaid reimbursement rate—helping to offset approximately $470 million in unreimbursed Medicaid costs faced by local hospitals. Under the Letter of Agreement (LOA), the County is obligated to remit up to $585,344,138 from the LPPF to AHCA, covering the DPP match portion. AHCA, in turn, will maintain all requisite records and supporting documentation associated with the health services covered under the LOA.
BUDGET: N/A