By Bill Cotterell and Letitia Stein
TALLAHASSEE/TAMPA, Fla. (Reuters) - Florida Governor Rick Scott said on Thursday he would sue to stop U.S. health leaders from ending more than $1 billion in federal funding for low-income patients, arguing it stemmed from the state's refusal to expand Obamacare for the working poor.
The dispute between Florida's Republican leaders and President Barack Obama's administration is entangled in Florida's rejection, so far, of about $51 billion available over 10 years to expand Medicaid coverage to some 1 million Floridians under the Affordable Care Act, known as Obamacare.
Scott singled out a letter in which federal officials acknowledged this week a connection between Medicaid expansion and negotiations over the state's "Low Income Pool." Florida stands to lose about $1 billion annually in federal funding to pay hospitals for treating needy patients.
The Democratic president is "crossing the line into a coercion tactic" in violation of a 2012 Supreme Court ruling allowing each state to decide on expansion, Scott contended.
"It is appalling that President Obama would cut off federal healthcare dollars to Florida in an effort to force our state further into Obamacare," he said in a statement.
Medicaid expansion has been deadlocked in Florida's Republican-controlled Legislature. State senators want the money, but the more conservative House of Representatives remains opposed.
Conservatives have blocked efforts to expand Medicaid in several Republican-leaning states this year.
Medicaid expansion would provide health insurance to working adults who fall into a coverage gap under Obamacare, being too poor to purchase plans under health insurance exchanges, but unable to qualify for traditional government Medicaid programs.
"It's all politics," Democrat Mark Pafford, Florida's House minority leader, said of Scott's threatened suit.
The pool, launched in 2006, supports hospitals serving large numbers of poorer and uninsured patients. Expanding Medicaid would reduce the burden of uncompensated care, federal officials said.
Medicaid expansion and the low-income funding "are linked in considering a solution for Florida's low income citizens, safety net providers, and taxpayers," an administrator with the U.S. Centers for Medicare and Medicaid Services wrote the state.
"Florida, like all states, is free to implement Medicaid expansion or not," agency spokesman Aaron Albright said in a statement on Thursday.
Florida's request to extend the optional program, expiring in June, raises questions given alternatives available, he said.
Scott, once a tepid supporter of expanding Medicaid under Obamamare, recently changed course.
Uncertainty over healthcare funding has stalemated negotiations over Florida's more than $80 billion budget.
(Writing by Letitia Stein; Editing by Doina Chiacu and Peter Cooney)