Budgets for public hospitals depend on privatization agreements

Legislators question moving forward

E.A. Conway Medical Center in Monroe would receive funding for three months of the year under Gov. Bobby Jindal’s $25.7 billion proposed state spending plan.

Jindal plans to turn eight public hospitals in Louisiana over to the private sector in a move he contends will save the state money.

But partnership agreements are only in place for five of the hospitals. And those agreements are not final.

The budget the Jindal administration presented to legislators Friday assumes the partnerships will take place. The presumption troubled legislators during the budget presentation.

“I’d be foolhardy to say, ‘Hell, I’m sure it’s going to work out,’ ” said state Sen. Francis Thompson, whose district includes the Monroe hospital.

Ten public hospitals in Louisiana provide care to the uninsured, either through the oversight of LSU Health Care Services or the LSU system.

In a move that could eliminate thousands of state government jobs, Jindal is restructuring the state’s public hospital and graduate medical education system.

Management for most of that system would shift to the private sector, which would receive public dollars to care for patients and would pay the state lease payments for facilities under the plan.

The Jindal administration contends the private sector is likely to employ most of the impacted hospital workers.

Patients and medical education programs at the LSU Earl K. Long Medical Center in Baton Rouge will move to Our Lady of the Lake Regional Medical Center.

Leonard J. Chabert Hospital in Houma will partner with Ochsner Health System and Terrebonne General Medical Center.

Similar arrangements are planned for public hospitals in Lafayette, Lake Charles, Monroe, Pineville, New Orleans and Bogalusa.

In preparing his proposed budget for the fiscal year that starts July 1, the governor gutted funding for the LSU Health Care Services Division, which is responsible for seven hospitals, including Earl K. Long Medical Center in Baton Rouge.

From a spending plan of $825 million Dec. 1, the division’s budget would shrink to $45 million in the upcoming fiscal year, according to the budget documents.

The budget for the LSU system, which has three public hospitals, would drop from $1.4 million on Dec. 1 to $827 million as Huey P. Long Medical Center in Pineville and E.A. Conway shift to private management.

With the private sector managing the hospitals, the facilities no longer would need sizable allocations in the state budget.

The lack of finality on the private-public agreements dominated legislators’ questions about the proposed budget.

Jindal was not present for the discussion.

Instead, Commissioner of Administration Kristy Nichols tackled the concerns, at one point correcting herself when she mispoke about how much money actually is in place from the partnerships.

Nichols said financial agreements on several of the partnerships will be available April 1.

State Sen. Norby Chabert, R-Houma, characterized the restructuring as what is glaring in the budget.

“It’s going to be a tremendous change. It’s not going to look like anything we’ve seen before,” he said.

The public hospital in Houma is named for Chabert’s father.

Thompson, D-Delhi, asked how negotiations stand on E.A. Conway in Monroe, saying he did not want to go home thinking he had a hospital only to find out he no longer does.

The Jindal administration only provided funding for the Monroe hospital for a quarter of the upcoming fiscal year in anticipation of finalizing a deal with a private partner.

Barry Dussé, state director of planning and budget for the Jindal administration, said the funding should last three months.

“I understand negotiations are going well for hospitals taken out of budget,” he told Thompson.

Thompson said that wasn’t a good enough answer for him.

“Public hospitals are gone after this budget. Finished. Over. Do not exist. Is that accurate?” he asked.

Nichols said public health services will be alive and present, just provided through a different model.

Thompson said the Jindal administration should try a different approach to putting together the budget. He said the public should be concerned about the proposal.

“I’m afraid if we’re in negotiations we may get picked like a buzzard does a dead animal,” Thompson said.

State Sen. Mike Walsworth interjected, saying he could just see the next day’s headlines.

Walsworth, R-West Monroe, said Conway will remain open, regardless of whether or not a contract is in place.

Later in the day, state Department of Health and Hospitals Secretary Bruce Greenstein said he is counting on the agreements materializing.

“I’m very confident,” he said. “We’re in the advanced stages of discussions.”