Balancing Louisiana’s budget could be trickier for state lawmakers and the governor.
Voters agreed in this week’s election to two constitutional amendments passed by the Legislature that will make it more difficult to cut hundreds of millions of dollars in Medicaid funding from hospitals and nursing homes.
A minimum payment level is now set for Medicaid patient reimbursements paid to nursing homes, pharmacies and institutions for the developmentally disabled. Cuts to those payments will face restrictions and will require the support of two-thirds of lawmakers.
Similar budget safeguards also will be given to hospitals after lawmakers set a fee structure that doesn’t yet exist in law. They are expected to consider the fee structure in the next legislative session that begins in 2015.
The added budget protections — estimates are they could affect nearly $2 billion in the Medicaid programs — will mean Louisiana’s public colleges are one of the most vulnerable areas to budget slashing when state finances are tight.
Supporters, including powerful lobbying groups for the facilities, said the protection will stabilize funding for critical health care services and help protect hospitals and nursing homes from damaging cuts that could threaten patient care. They said the protected facilities put up money that is used to draw down federal matching money for the health budget.
Opponents said it was improper to shield certain health facilities from cuts at the expense of home-based services and higher education, which will be left unprotected.
“The two that are left that are on the chopping block now that those have passed are your colleges and the home-based care for the elderly. That’s all that’s left. Those are the ones that are going to get hit,” said state Sen. Robert Adley, R-Benton, one of a few lawmakers who voted against the amendments sponsored by Louisiana House Speaker Chuck Kleckley, R-Lake Charles.
Gov. Bobby Jindal had raised concerns about the amendments before the election. But after passage, he said wasn’t worried that it would add difficulty to balancing the budget. “We’ll abide by the will of the people. We’ll continue to do as we’ve always done and present a balanced budget that doesn’t raise taxes and funds our priorities,” the Republican governor said.
The new protections come as the state faces a $1.2 billion budget shortfall for the fiscal year that begins July 1.
Before the amendments were passed, all Medicaid provider rates were set by the Department of Health and Hospitals. The proposals eliminate the department’s ability to cut rates without backing from lawmakers.
Now, cuts to payments for nursing homes, pharmacies and institutions for the developmentally disabled can’t be worse than for other health care providers and need the support of two-thirds of lawmakers.
Hospitals will get that protection when they pool their money and use those dollars to draw down new federal Medicaid money to compensate them for their care for the poor and uninsured. It involves a new fee assessed on the facilities, and lawmakers have to approve the fee structure.