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18.10.06

Blanco must eliminate sacred cow for real health care reform

The sound you hear may be that of Louisiana sharpening a knife to slaughter a sacred cow. But whether Gov. Kathleen Blanco and/or her successor actually does so is another matter.

Once again, reality has hit Blanco right between the eyes and she has found she must put aside politics for performance, although perhaps it took a bit of bribery to get her to see the light this time. Blanco and her
health care redesign panel finally in principle seem to agree that universal health care coverage around New Orleans should be attained primarily through a money-follows-the-person regime, rather than the “build-and-they-will-come” philosophy that produced Louisiana’s inefficient charity hospital system, unique among the states. As part of this, it appears that the federal government will commit additional funds for a few years to ease the transition statewide (the state claims it may cost as much as a billion bucks more a year at the start than under current state spending, while the federal government says the extra cost may be as little as ten percent of that figure).

With this, Blanco can position herself as fulfilling a campaign promise to reform the health care system in the state, something she badly needed to claim against her previous and likely future opponent, U.S. Rep.
Bobby Jindal who has had extensive experience in administering health care programs at both the state and federal level. Well … maybe.

Unfortunately, Blanco still insists on keeping as part of her plan the “medical home” concept, giving the uninsured the choice of whether to accept money from the government to subsidize health care decisions they make, or to be assigned to a provider that the state pay for their care. The questionable part of that is the charity hospitals would be a medical home, allowing Blanco and the state to continue to justify their existence as funded state entities.

While charity system chief Don Smithburg (which runs nine of the institutions, the other two run as a unit of LSU) opines that those hospitals will do well enough financially under this system (what wouldn’t given the state subsidies coming into them?), his assertion that outcomes produced would be more than adequate does not apply generally to the entire system, nor even uniformally to the institution to which he was referring, the Medical Center of Louisiana at New Orleans,
statistics show.

That institution performs comparably to private hospitals in its area (as well as in some areas, but worse in others); this also is the case for the other largely-teaching institutions in the state. But when comparing the smaller state facilities than exist mainly for service to local private entities, they do worse. In other words, the medical home idea would end up diverting some resources to less-efficient providers run by the state, costing more and/or reducing quality of care compared to the money-follows-the-person scenario.

This means that, as
previously noted, the state needs to consolidate teaching functions within four, maybe five at most, of the institutions, and divest itself of the remainder. Unless this is done, by the time the transitional period federal money runs out, system inefficiencies will pass on a cost increase to be borne by Louisiana taxpayers.

For real reform to occur, Blanco must commit to this realigning. If she doesn’t, it’s up to those like Jindal to publicize this during her reelection bid in an effort to not allow her to falsely claim she has engaged in any meaningful health care reform, and thus, as happened in this latest incident, eventually to force her to do the right thing by eliminating the sacredness of the charity hospital system.

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