A report legislators ordered up to help evaluate how goes the privatization of the government-run health insurance program is full of errors and inconsistencies, the legislative auditor said Wednesday, an assessment with which the state’s medical chief disagrees.
State Department of Health and Hospitals Secretary Kathy Kliebert said the report “fully complies” with the law legislators adopted requiring the “transparency” report that includes the data lawmakers can use to analyze the performance of the private managed-care networks hired by the state to handle Medicaid services through what is called the Bayou Health program.
But Legislative Auditor Daryl Purpera said the report “has comments, numbers you cannot rely on.” The report has math errors and makes unsubstantiated claims. “I don’t want legislators relying on it because there are significant flaws,” he told the Legislative Audit Advisory Council, a legislative committee that oversees the work Purpera’s shop does.
“It troubles me we would have a report submitted to us that contains language like these global assertions being made with no data to back it up,” said state Sen. Ben Nevers, D-Bogalusa, a member of the council.
New Orleans Republican state Rep. Cameron Henry wanted to know what information DHH had to support the assertion that there has been savings.
DHH Undersecretary Jeff Reynolds said the best evidence is a $135 million reduction in Medicaid, which had to be accomplished or there would have been cuts.
Henry asked for proof of where the savings occurred.
Gov. Bobby Jindal privatized much of the Medicaid program in 2012, shifting 900,000 of Louisiana’s 1.4 million Medicaid recipients to the insurance model. Medicaid recipients in Bayou Health choose from one of five privately operated networks of primary care doctors, specialists and hospitals.
The state is in the process of requesting proposals from companies for a new contract period. The program is moving to a straight managed care insurance model, in which the state pays policy premium costs. Current three-year contracts with five companies end Feb. 1.
An August legislative audit report found the Jindal administration’s positive report to the Legislature on the status of Medicaid privatization lacked data supporting “global assertions” of cost savings and improved health outcomes.
The auditor said DHH relied too heavily on data provided by the insurance companies participating in Bayou Health — information that was not independently verified by DHH.
Comparisons between traditional Medicaid — the government insurance program for the poor — and the new privatization did not use comparable data which the auditor said rendered most of the comparisons “skewed and not useful.”
The DHH legislative report covered July 2012 through June 2013.
The audit was conducted to evaluate the reliability and consistency of the information the state health agency reported to the Legislature in January. The report has been dubbed the Bayou Health Transparency Report. A new report is due in January 2015.
Kliebert said the annual report would be improved in future years. She said it was the agency’s first effort and the extensive data required was done on a tight time-frame. In the future a certified public accounting firm will do an independent verification of reporting done by the private health insurance companies.
State Rep. Hunter Greene, R-Baton Rouge, said the agency should have been prepared to do the report since the Legislature had approved legislation requiring the data on two prior occasions only to have it vetoed by Gov. Bobby Jindal. Jindal signed the “transparency” report legislation on legislators’ third try.
Follow Marsha Shuler on Twitter @MarshaShulerCNB. For more coverage of the state capitol, follow Louisiana Politics at http://blogs.theadvocate.com/politicsblog/