Legislators likely won’t act on a constitutional provision approved by Louisiana voters in November that would have protected some of the money hospitals are paid to provide medical care for the poor and uninsured.
“I’m 99 percent sure we are not doing anything,” said House Speaker Chuck Kleckley, R-Lake Charles, who sponsored the constitutional amendment aimed at helping hospitals. The plan was designed to protect Louisiana hospitals from budget cuts.
Before the provision goes into effect, the Legislature and hospitals must check off a list of requirements. That’s not likely to happen in the legislative session that begins April 13. That focus will be on how to close a gap in revenues, which are expected to come up $1.6 billion short of the money necessary to pay for existing state government services. State law dictates the amount of spending on many government services, but not health care and higher education. Consequently, the budgets have been chopped repeatedly.
“To talk about it in this environment is in nobody’s best interest,” said Paul Salles, president of Louisiana Hospital Association.
The constitutional provision would make it difficult for state government to lower the fees paid to hospitals for health care services delivered to state Medicaid patients, who account for one of every four Louisiana residents.
A majority of Louisiana voters — 56 percent — approved the constitutional amendment creating the Hospital Stabilization Fund during Nov. 4 statewide elections.
The special fund would be fueled by assessments hospitals would put on themselves. Just exactly what form the assessment would take hasn’t been decided — it could be a fee or tax. It would generate money state government could use to attract additional federal matching dollars.
Hospitals would be guaranteed a baseline compensation rate and provided a layer of protection from budget cuts.
To set the process in motion, the hospital assessment would have to be agreed upon by the legislators and the hospital association members. The Legislature would then have to approve by a two-thirds vote a hospital funding formula.
“It’s pretty complicated as everything in health care is,” Kleckley said, looking at the prospects of state funding cuts that would translate into a more than $700 million reduction in Medicaid funding once the federal matching monies are counted.
The fiscal year 2016 budget begins July 1.
“There’s no reason to do it if there’s no money to get,” he said.
And Salles said hospitals aren’t interested in imposing an assessment to fill “short-term budget holes. ... Our goal clearly is long-term sustainability.”
Salles also said there are some limits on additional federal dollars the hospitals are trying to attract for care of the poor and uninsured. He said the state is at its Medicaid Upper Payment Limit.
The UPL is a federal cap on fee-for-service reimbursement of Medicaid providers. It is the maximum a given state Medicaid program can pay a type of provider in the aggregate, statewide, in Medicaid fee-for-service. State Medicaid programs cannot claim federal matching dollars for provider payments in excess of their UPL.
Salles said the cap has been hit with financing guarantees to private firms taking over operation of LSU hospitals and private insurance companies now managing the health care of some 900,000 Medicaid patients.
Complicating the situation, Salles said, are the many changes that continue to be made to the Medicaid program. “It’s difficult to see how the assessment program would fit in without some certainty about the program in general,” he said.
“It’s very complex,” he said.
In addition, Salles said: “This will particularly be a tough year given it’s an election year. ... It takes a lot of support from a lot of people.”