Feds question charity hospital partnerships
The financial viability of Louisiana’s newly privatized network of safety-net hospitals is in doubt after federal authorities formally threatened to withhold $307 million in Medicaid funding due to an ongoing disagreement over how the hospital partnerships are structured and financed. Melinda Deslatte of the Associated Press, who broke the story, reports that the withholding wouldn’t take place for at least a year, giving the state time to resolve the issue without taking a budget hit.
Nine of the 10 former LSU charity hospitals have been privatized in the last year, but the federal Center for Medicare and Medicaid Services (CMS) has only signed off on one of the agreements, leaving the rest in limbo and creating uncertainty for the state’s budget outlook. The partnerships will cost $1.1 billion this year, mostly paid for with federal funds. It is unclear how far apart CMS and the state Department of Health and Hospitals are in their negotiations.
The state received the notice from CMS on Monday, reports the Advocate, the same day that DHH Secretary Kathy Kliebert and LSU hospitals chief Frank Opelka assured the Senate Finance Committee that nothing was amiss with the partnerships. State health authorities then sat on the news until Thursday evening, in apparent violation of a 2013 law that requires the department to post all correspondence with CMS on its website within 24 hours of receipt.
The highly unusual structure of the hospital partnerships is at least partly due to Louisiana’s ongoing refusal to expand Medicaid, which would allow the state to access billions in federal funds that would sustain the partnerships. Rather than accept money for coverage that would follow low-income patients wherever they seek care, the Jindal administration has tried to prop up the outmoded safety-net model through a complicated financing scheme that now appears to be running aground.
Push for higher minimum wage shot down by House committee
The House Labor and Industrial Relations Committee voted down legislation 10 to 6 on Thursday that would have instituted a minimum wage in Louisiana higher than the current federal wage of $7.25 an hour, reports the Advocate. Rep. Herbert Dixon’s House Bill 356 would have boosted the minimum wage to $9 an hour by 2016 and index it to inflation after that. Had the minimum wage kept pace with the cost of living since 1968, it would be $10.74 an hour today.
The Louisiana Association of Business and Industry and Louisiana Restaurant Association opposed the bill, claiming that it would lead to fewer job opportunities and actually hurt low-income families, despite real-world evidence that past local and state increases have not led to job loss, but have put more money back into the pockets of working families and helped reduce poverty. The Louisiana Budget Project’s recent research on the issue found that raising the wage to $8.50 an hour would provide an immediate raise to 184,000 workers and create an estimated 1,400 new jobs as $187 million was pumped back into the Louisiana’s economy through consumer spending.
The committee also rejected a bill to allow the voters to have their say on the issue in November. Recent polling found that 73 percent of Louisianans support a higher wage, including 62 percent of Republicans and 70 percent of independents. In fact, respondents in every age, income and racial bracket support a higher wage.
In other minimum wage news, two public health researchers noted in a letter to the Times-Picayune that raising the wage would also have positive health impacts, citing the strong correlation between economic insecurity, stress and poor health outcomes.
Road maintenance backlog contributes to growing list of “structurally deficient” bridges
A report from the Legislative Auditor found that nearly 2,000 of the 13,000 bridges in Louisiana are “structurally deficient,” giving the state the dubious distinction of having the 13th worst bridges in the nation. “It doesn’t mean that you can’t drive over them. It means they need repair work. We’re about $2.7 billion in backlog on maintenance and construction, primarily because of lack of funds,” Legislative Auditor Daryl Purpera told the Shreveport Times. The auditor also found deficiencies in the state’s bridge inspection process. The state Department of Transportation and Development only met 39 percent of the Federal Highway Administration’s inspection metrics.
New Orleans community leaders worry about health care, higher education
A group of “community leaders” convened by the Times-Picayune — including leaders in the business and non-profit communities, a health insurance executive and a lawyer — expressed optimism for the future of the New Orleans metro area, but voiced concern that the state’s underinvestment in health care and higher education are holding back progress. Gov. Jindal’s refusal to take advantage of the opportunity to expand Medicaid to working adults was roundly criticized, with Peoples Health CEO Carol Solomon noting that “the hospitals are scrambling” because the governor’s decision will financially destabilize many health care providers. The group also lamented that the Jindal administration’s deep cuts to state support for colleges and universities have hurt the quality of education.