Search This Blog

Loading...

8.2.07

Vitter pushes Blanco to do right for taxpayers, indigent

Thus, it takes another push from the federal government to make Louisiana do the right thing when it comes to indigent health care. Sen. David Vitter, who said his message merely echoes the sentiments of Housing and Urban Development Secretary Alphonso Jackson, argued in a letter to Gov. Kathleen Blanco and Jackson that the federal government should not pitch in $300 million to build a new state-owned hospital in New Orleans unless it also revamped its indigent health care system away from its institutional bias to a money-follows-the-person regime.

With the widespread damage from the 2005 hurricane disaster brought to the existing Medical Center of Louisiana New Orleans facilities (better known as “Big” Charity Hospital), the state decided it should build a whole new complex around downtown rather than renovate permanently the existing one. That’s not a bad idea, but the state rolled out an extremely ambitious, much expanded plan but which depends upon being attached to a Department of Veterans Affairs veterans’ hospital. The federal contribution to this would be $300 million.

However, Vitter signaled that the state should not get disbursement of that money unless it also agreed to scrap any vestige of the money-given-to-the institution charity hospital system of indigent care. That system (found only in Louisiana) is less efficient and produces poorer outcomes with fewer services than the model the state is being urged to adopt by the federal government, but Blanco and other state officials have put up strong resistance to genuine system reform because it would reduce a reduction of scope, size, and authority of government, and would steer money away from the special interests backing these politicians.

(While it’s true that Vitter is a Republican and virtually all the opponents of reform are Democrats, it’s not really a partisan issue. No less than Democrat stalwart and former Sen. John Breaux has come out in favor of real reform. Rather, battle lines have been drawn between big government practitioners of politics as usual who have run Louisiana for decades and those who wish to transfer power from government to the people, in this case clients of indigent health care. For her part, Blanco showed how inflexible and lacking in creative thinking she is with her reaction to Vitter’s letter: “I simply have a hard time believing that Secretary Jackson, who deeply cares about the low-income population, would go along with such a plan to inflict so much potential harm.”)

The two issues relate: much of the justification for an expansion of Big Charity rests on its continued use as the processing warehouse for indigent care; give the indigent their own insurance they can use at a variety of places rather than giving them a location at which to appear when needing care and traffic at Big Charity will go down. The fact that the greater New Orleans area also will be down at least a couple of hundred thousand people perhaps for the foreseeable future in a market with too many beds prior to Hurricane Katrina does not seem to have made an impression of those who want more beds in the new facility.

Blanco, the good old boys around her, and the special interests benefiting from the current system are like junkies who need their crack removed to start their recovery – in this instance, with denial of the federal funds for the grandiose Big Charity. Instead, the federal government could pledge to give that amount to the state for transition costs (which would require some redirection of funds between HUD and the Department of Health and Human Services which might have to involve Congress) while the state scales back on its idea for the new complex that would not require that federal money. Add to that no possibility of federal waivers to redirect those dollars going into the state’s Medicaid program and no additional transition dollars unless the state junks any element of its current system in any redesign.

Vitter deserves applause for standing up for Louisiana and American taxpayers and for those who need indigent health care in the state; hopefully his tough love and the support of Jackson will get Blanco and her cronies to put people ahead of politics on both of these issues.

7.2.07

Stuck on stupid XXII: Saving big government rather than money

If an idea makes sense, you can bet the good-old-boys (and girls) that comprise a majority of elected officials in Louisiana are going to reject it. Gov. Kathleen Blanco in this regard didn’t disappoint when she said a universal health care plan whose early indications in other states are positive that would replace Louisiana’s solitary, inefficient, and low-performing charity hospital-based plan “seems to be an insult to our intelligence.”

Blanco and her minions continue to insist that the plan pushed by the federal government, which states across the country are adopting, is not for Louisiana. Alone among analysts of the plan, which would steer federal health care dollars away from institutions and into the hands of presently-uninsured health care clients, they actually think, when all the evidence is against them, that only a system something like what the state presently has will produce cost-effective and acceptable patient outcomes.

One reason Blanco has taken this line is that the federal government has not offered to pay for all of the transition costs into the better system. There will be some because for awhile two systems, the recommended money-follows-the-person and the existing money-given-to-the-institution, will run simultaneously. As time passes and the former, efficient system gains usage at the expense of the latter, inefficient one, costs per uninsured will decrease.

As usual, Louisiana wants somebody else to pay for its mistakes, even as the state sits on potentially more than a billion dollars in surplus that could pay for any transition dollars the federal government does not provide – which would provide savings in the future. But the state’s contention itself rings hollow that the costs will be so high. Both the federal government and those outside government repeatedly have questioned this state’s figures, saying they are very much exaggerated.

Even if the state’s claim wasn’t so dubious, the fact remains many savings could be made in Louisiana health care spending with simple legal and procedural changes. Just to name one, the state’s own auditors concluded that nearly $100 million a year alone could be saved by changes in how nursing homes are reimbursed.

Another indicator of the state’s inherent inefficiency in providing care is in its per capita expenses for uninsured care. In Massachusetts (which recently reformed its system along the lines Louisiana should), that state spent about $1.3 billion last year for a population of almost 6.5 million, or an average of $202 per person, while Louisiana spent $935 million for a population of just over 4.25 million for an average cost of $218 per person – and Massachusetts covers more services and more expensive ones than does Louisiana. A money follows-the-person system would force more efficiency into spending as private entities who must compete against each other take a bigger share of total dollars spent.

The smokescreen about costs gets circulated because the Blanco Administration needs political cover for its real motive in rejecting needed change: protecting the large state government structure of charity hospitals and other institutions, and interests of other institutions outside of government who have become junkies dependent upon state money in this policy area. Tossing money around to certain constituencies brought these people to power, and it’s the only thing they know.

It’s the old unwelcome love of big government exhibited by Blanco and many of her predecessors and fellow state politicians who do not really understand the way the world really works and who put more faith in government than in people to solve problems. And thus she and defenders of the present ailing system, like state Sen. and nursing home operator Joe McPherson, on this issue remain stuck on stupid.

6.2.07

Solid Jindal support will discourage gubernatorial aspirants

As gubernatorial candidates throw themselves in rapid fashion into Louisiana’s 2007 contest, unsurprisingly some musing has occurred regarding the meaning of it all. Those who attempt this should understand clearly what they try to analyze.

Speculation increases that Gov. Kathleen Blanco, so mortally wounded as a candidate by her missteps in office, will withdraw from the race, despite the fact that she just held a large fundraiser (if not running for reelection, what else could she possible think she could run for and win?). Blanco never has lost a race and is particularly stubborn. Further, at least through the end of the regular legislative session she will believe there is ample opportunity to salvage enough of her political fortune that she can win in October.

For her ever to change her mind, a lot has to not go right for her in the session. Unless that happens, she will remain in the race and effectively prevent any other serious Democrat other than the quixotic Public Service Commissioner Foster Campbell from running. No quality Democrat who is not after an ego boost would dare enter, knowing his upside in vote proportion in the primary likely would be less than Republican frontrunner Rep. Bobby Jindal’s and his partisan colleague competitive state Sen. Walter Boasso’s. The GOP dream would be to have another quality Democrat compete against Blanco and Campbell because that almost assuredly means Jindal and Boasso make the general election runoff.

The odds are against a Blanco deferral, but what if that happens? Only two Democrats at this time could be competitive against a Jindal-Boasso combination, Rep. Charlie Melancon and former Rep. Chris John. The latter probably would have trouble making the runoff. He was soundly dispatched by Sen. David Vitter in the 2004 Senate race, Jindal looks to be as relatively strong now if not stronger than Vitter then, and Boasso would take a decent chunk of prospective John votes away.

Melancon might be a better candidate to make a runoff against Jindal but likely still would end up failing against him. This is an unlikely scenario in any event because Melancon is extremely reluctant to run, and Boasso’s entrance into the race should make him even moreso. Simply, if Boasso doesn’t win this time out, in 2008 after a warm-up in 2007, he has two plum contests available to him. One is to run for Senate against Sen. Mary Landrieu, but the possible candidacy of state Treasurer John Kennedy if he switches parties may cause him to hesitate. The other would be a clear, unfettered shot at Melancon in a district in a presidential election year that will be reminded Melancon is a more liberal than conservative candidate of a party whose presidential candidate will be way more liberal that the Third District likes.

While some might believe Jindal and Melancon off-Congressional-year runs are equivalent, it shows they do not understand the underlying dynamics. Jindal loses nothing in an attempt at the Governor’s mansion, but Melancon could lose everything. Jindal’s House seat is absolutely safe; Melanocn’s is anything but, exacerbated by multi-millionaire Boasso’s warm-up signaling his intentions for higher office. In short, Melancon is unlikely to want to expend extra resources in an uncertain bid at the governorship when he may face a tremendous challenge in an unfavorable electoral environment a year later. Despite pressure being levied against him to get in the governor’s race, he is exceptionally unlikely to do so.

What too many analysts misunderstand about this governor’s race is that Jindal has become the mythical immovable object in the field. It is a mistake to think that Jindal’s high vote intention numbers only are a reflection of the competition he is expected to encounter. Rather, they are a sign of his attraction of voters regardless of who is in the field. No matter how many people enter this contest, he has a third of the vote regardless, and it’s almost mathematically impossible that two other candidates will exceed that. He runs and, barring some incredible circumstance, he’s in the runoff.

The question is whether who is there with him. At this point, the only two candidates with a hope of beating him there would be Boasso and Melancon (others like former state Democrat leader and businessman Jim Bernhard and GOP businessman John Georges will find gobs of money can’t make up for inexperience and, in Bernhard’s case bad publicity when he was chairman of the state Democrats especially against a field of this quality), and even they probably are not even money against him. Anybody else is highly unlikely to do beat Jindal.

This is reality and unless announced or otherwise candidates, including Jindal, recognize this and plan for it, that will greatly hamper any success they hope to have in this quest.

5.2.07

Barring good sense, minimum wage hike set to hurt LA

The issue of raising the national minimum wage shows again why Gov. Kathleen Blanco hasn’t a clue as far as the right policy for Louisiana, and any increase in it bodes ill for the state.

Competing bills are wending their ways through Congress that would boost it, although an effort exists to introduce tax breaks with it to try to mitigate its negative impact. There’s nothing good about raising it because it coercively takes resources from more productive users of them and transfers them to less productive users – meaning except for the small portion of the population that gets paid at that rate, the majority of whom are employed part-time and/or are not heads of households, all of society is worse off by its implementation.

Simply understood, the marketplace rewards people in proportion to their contributions to society. If a job without government mandate pays less than a minimum wage, it’s because the true value of that job to society is below that level. Not only do minimum wage laws create inefficient use of resources because of that transfer, but they also produce a ripple effect for wages near that level through upward wage pressure produced by the increase, overpricing additional wages.