Millions in cuts slated for Medicaid

Critics say services will be weakened

The Jindal administration is preparing to roll out about $860 million in cuts to the government’s insurance program that delivers health care to Louisiana’s poor — the result of newly authorized federal Medicaid funding reductions critics call disastrous.

Major health care providers said Friday they are preparing for something they know cannot be good for them or the poor, elderly and disabled once the funds are stripped from the $7.7 billion Medicaid program.

One association that provides community services to the developmentally disabled is already calling for a special legislative session to generate revenues to offset more cuts in the fiscal year that began Sunday.

Another association executive wondered whether the state could still have a viable program that meets federal Medicaid “access to care” requirements.

In a statement, Gov. Bobby Jindal said the administration’s Department of Health and Hospitals would disclose its plan next week.

“At the end of the day, Louisiana will have a balanced budget that doesn’t raise taxes on families and businesses,” Jindal said. He said the administration would continue to “right-size government by streamlining and consolidating services so that we can do more with less” in a statement that did not address specific questions posed to him.

DHH Secretary Bruce Greenstein has not commented since Congress included the Medicaid provision as part of a compromise on the federal transportation funding bill. President Barack Obama signed the measure into law Friday.

Commissioner of Administration Paul Rainwater said in a statement that he and Greenstein are “working closely together on a plan that continues to reform and restructure the way the state delivers health care services.”

Legislative leaders in the health care arena and key providers said they have been left in the dark.

“There’s not a lot of good choices,” said state Senate Health and Welfare chairman David Heitmeier, D-New Orleans, who said discussions can begin once the plan is laid out.

“It’s going to be devastating. There’s no way to sugar- coat it,” said Louisiana House Health and Welfare Committee Chairman Scott Simon, R-Abita Springs.

Louisiana Hospital Association President John Matessino said the administration must act quickly because the longer the delay the deeper the cuts will be because they will be spread over a shorter period of time.

“We are not going to be immune from cuts. I don’t think any provider is going to be immune from cuts,” Matessino said. “We are going to cut $1 billion out of the Medicaid program. How can that be good?”

Matessino referred to the cumulative effect of the federal funding reduction which runs over two state fiscal years.

Matessino said his office has been getting lots of calls from hospitals around the state concerned about what’s coming their way.

The federal Centers for Medicare and Medicaid Services must approve many changes in state health care policy. Some Medicaid programs are mandatory and must meet certain federal guidelines. Others are considered optional.

Louisiana State Medical Society Executive Vice President Jeff Williams said whatever the administration comes up with is going to have to be system-wide and a systemic change.

Williams said a provision in the federal law that requires reimbursement rates to physicians and other providers to be sufficient enough to ensure Medicaid patients have the same access to health care as a private-pay patient.

“We are very concerned a bad situation is going to get worse,” Williams said. He added that some physicians who practice in specialties have already had their rates cut by 50 percent over the last two years. “Everybody’s been cut at least 25 percent,” he said. “I don’t see how in the world providers can take another cut and access not be dramatically impacted.”

Williams said physicians are key to the Jindal administration’s new private sector-based health care delivery system for the poor called Bayou Health. Companies enter into contracts with physicians, hospitals and others forming provider networks responsible for care coordination.

The proposals Greenstein initially floated when news of the potential Medicaid hit first surfaced sounded bad but they would not be enough to close the gap, Williams said.

Among those were a 10.2 percent cut in total payments to health care providers for Medicaid services performed, and reductions in uncompensated care payments to LSU hospitals and rural hospitals as well as hits to breast and cervical cancer screenings, foster care services, adult dentures, hospice care and more.

Already Supported Living Network executive Bruce Blaney is calling for the Legislature to call itself into special session to look at repeal of some of the state’s $4.7 billion in tax exemptions to generate additional revenue and to allow health care trust funds to be tapped.

“We have to go in session to get the money. Otherwise, this state will be the first state since California to shut down its Medicaid program,” said Blaney, a former DHH assistant secretary. “This is a catastrophe.”

Blaney said many firms that provide in-home supports for the developmentally disabled and elderly would be forced to close their doors.

Prior cuts have already prompted an attorney to file a complaint against the state with the Centers for Medicare and Medicaid Services, claiming the cuts threaten provision of in-home supports for the elderly and developmentally disabled.