Five years ago, in a room deep in the bowels of the State Capitol, David L. Callecod, president of Lafayette General, signed a contract with the state to administer the public Lafayette University hospital open to all regardless of their ability to pay.
He recalls friends warning him that a deal with the state would be different from one forged in the private world. “A number of people told us that this would be fraught with all kinds of things we weren’t anticipating,” Callecod said Thursday.
They were right.
What started as a pledge of work for pay has turned to an annual ritual where the state tries to find the money to uphold its end of the bargain while insisting that the hospitals continue operating. Every year the public hospitals, like the universities, are pawns in a grand policy debate that pits revenues (read: more taxes) against efficiencies (read: more cuts) against a backdrop of continued revenue shortfalls.
But this year the worry is not philosophy, but paralysis.
Legislative battle lines have so hardened that many of the pawns fear that this time lawmakers, who have to fill a $640 million revenue gap by July 1, won’t be able to patch together enough money as they have in the past.
Lafayette General’s University Hospital was appropriated about $118 million for the fiscal year ending June 30. For the year beginning July 1, the House recommends $60 million, though that amount could change as the Senate finishes up with the state budget.
Back in April when the amount was zero, Callecod began the process of disengaging with the state, part of which included sending letters to 800 employees warning that they may have to clean out their lockers come July 1, if the final state budget doesn’t include more money.
Callecod said he followed the appropriate legal and fiduciary protocols because on July 1, Lafayette General assumes all the costs. “We don’t have $60 million,” he said.
Mike Shamp, one of those 800 University employees who received a notice of possible layoff, is worried. He doesn’t see legislators coming to any common ground.
A self-described “John Q. Republican,” Shamp came to Baton Rouge on his own to walk the halls of the Capitol and ask legislators to work together. “We feel like we’re a hostage in this fight, every year. I’m hoping they give up this political posturing and fix this thing,” he said, adding that he's looking for a new job as are many of his colleagues.
Shamp said he understood Callecod’s action. Others did not.
Callecod was accused of exaggerating for political purposes — after all, legislators have always come through before.
Criticism of Callecod only subsided last week with Democratic Gov. John Bel Edwards’s “throw grandma to the curb” brinkmanship. The state sent out letters to 36,482 Medicaid recipients in programs that help the elderly and disabled, giving them fair warning that the state may not have enough money.
Republicans howled. Nothing is imminent, they said. The federal government, which provides most of the dollars, would have to approve the state not using the portion it puts up.
In a tweet, Lafayette Republican Rep. Nancy Landry slammed the letters: “Unprecedented fear mongering is going on in our state right now in an effort to get citizens to demand that we raise taxes. It is a shame that our most vulnerable citizens are being used year after year as pawns to advance a political agenda to raise taxes.”
“This is not a tactic,” Edwards told CBS News. “The Legislature has failed to act.”
The class of legislators who took office in 2016 haven’t gotten along in the best of times. But this session tempers seem much shorter.
Central Republican Rep. Barry Ivey cursed as he stormed out of the chamber Thursday night after his colleagues hooted at him for asking a question about a bill. Commissioner of Administration Jay Dardenne was castigated in Friday’s Senate Finance Committee by Democrats and Republicans alike for criticizing the budget bill they had just advanced.
All of which provides little comfort to the people whose lives depend on the Legislature passing a budget with enough money in it to keep their programs going.
Dr. James Falterman, associate dean of the LSU Medical Center in New Orleans, is talking with legislators and watching the process closely while trying to calm the fears of the 26 physician residents in Lafayette he oversees. The residents may have to abruptly move to other states if the Lafayette hospital is not adequately funded.
Falterman has been through this before. “This year it seems to be going down to the ‘nth’ hour,” he said.