Back when Gov. Bobby Jindal wanted to save money on the big Medicaid program, he turned to managed care companies to run most of the health insurance program for the poor. He was backed by most Republicans, and Democrats — and many elements of the medical professions — complained that care would suffer and that the contracts would not save any money.
Oddly enough, now that there is a Democratic governor wanting to continue managed care in Medicaid, it is Republicans who are balking.
Back then, the GOP was rushing the contracts with managed care companies through, seeking a win for their governor. Now they are slow-walking the extension process, over the objections of the staff who have to make today's system work.
What's up with all this?
The House GOP blocked the big contracts for the state's biggest programs, ostensibly seeking more savings. This was profoundly to the frustration of Department of Health bureaucrats, who have to deal with the possibility that the contracts won't be renewed, throwing Medicaid — again, the state's biggest program — into chaos, because turning back the clock to fee-for-service would be a nightmare administratively.
Gov. John Bel Edwards' Democratic administration wants to keep the five deals with managed care companies in place for another 23 months beyond their January expiration date. But GOP lawmakers raised concerns about the price tag for the extension: $15.4 billion in federal and state cash, for services covering about 1.5 million recipients in hospitals and doctors' offices.
Appropriations Chairman Cameron Henry and other lawmakers said they want the health department to try to squeeze more savings out of the contracts and respond to audits raising concerns about the companies' performance. But the GOP senators voted unanimously for the extension, showing more savvy about what is realistic in running government.
The Joint Legislative Committee on the Budget is going to meet again on the contracts in December. We urge the House members to join in approving the extension, because it takes a majority of both House and Senate members on the joint panel to take a decision.
"If we can save a dollar anywhere, I don't see the harm in waiting to try to get there," said Henry, a Jefferson Parish Republican, but he was directly contradicted by the Health Department staff: The contracts don't deal with what the state spends but how it spends the money. In managed care, the idea is that people continue to get services but through better coordination and elimination of duplication, the state overall saves money.
Jen Steele, Louisiana's Medicaid director, told the lawmakers the only way to cut contract costs is to change Medicaid-eligible services. That requires more than just changes to the contract with managed care companies, which only administer what the state law and rules set out.
We agree that these contracts need work, through an orderly but inevitably long process of requesting new proposals for services. The Legislative Auditor's Office has questioned some billing practices by providers of mental health services under Medicaid, for example. That can be addressed. But not by brinksmanship over the management contracts.
This is a Jindal idea that may have been rushed at the start but could be of great long-term value. Balking at this process shows a tenuous grasp of budgetary and administrative reality among those voting against the administration.