Draining nursing home fund money its best use for now

It should not have been unexpected that Louisiana would intensify its draining of the Medicaid Trust Fund for the Elderly after voters unwisely further cordoned off funds on behalf of a special interest. That response assuredly was the correct one.

At the turn of the millennium, the Fund was created by the state at the prodding of the federal government to deposit $500 million of federal Medicaid money as part of an agreement closing out a loophole a number of states had enjoyed that multiplied their receipts, but Louisiana more than any other by routing so much Medicaid bucks through the charity hospital system. Although backers claimed the principal should not be touched, the law clearly allows that any of it can be used to support funding paid to nursing homes, while the interest earnings from the principal essentially could be used for any purpose.

Last year, that latter possibility got removed through a constitution amendment, making this an even sweeter deal for nursing homes, which long have been favored by state policy despite their increasing inefficiency in care relative to home- and community-based solutions. Until the time the fund was created, policy deliberately favored them that created a situation where the typical nursing home in the state received over 80 percent of its revenue for Medicaid and among all of them the state had the nation’s highest per capita state payments to nursing homes with the lowest rate of bed occupancy.

Transformative Jindal hopes for better national reception

In the slow days after a regular legislative session has ended, complete with the governor’s chance to veto bills and line items and when it has become apparent there won’t be an unprecedented veto session, during this period of sparse political news in recent years it’s become fashionable for observers, looking for something to discuss, to assess the states of Louisiana and Gov. Bobby Jindal. With his relatively high national profile, there’s always something banging around in his political life that can provide fodder for commentary.

Thus we get an excursion into his national political health, on the assumption that he covets substantial elective office of some kind at that level; specifically, the nexus of how his state governance translates into future ambitions. From legislators who work with him and a pollster, we learn that his popularity has dipped into negative territory because reform is wearing people out and that he needs more engagement in order to succeed more with a reform agenda. Further, this engagement must be at a more personal and visceral and less nuanced level. Until he behaves this way, it is averred, he cannot create state policy-making success that pays dividends at the national level.

All of this is true, yet most of it is irrelevant to understand the state’s current policy-making environment that shapes and constrains Jindal. The clue comes from the notion of “reform fatigue,” because this reveals the motive force behind much of his policy-making and the reaction to it. Simply put, that is this: Jindal’s gubernatorial career has consisted of a radical and entirely necessary transformation of the state’s political culture that started behind the scenes and now has burst into full view that has challenged allies and enemies alike, and he’s paying for it at the state level.

Dueling voucher pieces shows opponents' desperation

I doubt it was planned, but what turned into a New Orleans Times-Picayune version of point/counterpoint on the issue of school vouchers illustrates well the poverty of the case against their use in Louisiana’s provision of education and in a way desperate enough to be telling that the real goal is distraction from the main issue.

Almost simultaneously published on site were a column wondering whether the several million of dollars that went into this year’s program was spent wisely and another concluding the initial indications showed the program’s administration was off to a good start. The program allows students who otherwise would attend a poorly-performing school to have the state pay for their tuition to attend a qualifying private or public school, at a level below what taxpayers would have to give to the public school that would have been attended.

The negative piece, written by former reporter and political shill for various elected Democrats, and current journalism school director Bob Mann, concentrated mainly on the one school where auditors discovered misuse of funds, and more generally charged that “education ‘reforms’ appear to be as shoddy and deceitful as the product” produced by that school, on the basis of that and that the large majority of audited schools did not keep records in a way that definitively allowed for determination that money used had proper accounting controls and was for educational expenditures. Throughout, rhetorical tricks were used in place of logical analysis to try to make these points, supplemented by the ignoring of any context at all.

Glover must relent, not hold out until last dog hung

Like fleas on a mutt, the dog park issue for Shreveport just won’t go away. (From now on, this author promises instead of inflicting a groaner every time this issue gets discussed, he’ll simply write, “Insert clever phrase about politics and dogs here.”) Throughout, the tide of political ramifications continues to turn against Mayor Cedric Glover.

Many moons ago (whether barked at; sorry, last time as well for deliberate use of phrases associated with dogs), proponents of using $280,000 given by the Red River Waterway Commission to build a dog park on the Shreveport river front brought in courts to intervene successfully in the matter. The RRWC has the authority to fund projects of this nature with its separate taxpayer dollars as long as they enhance the environment proximate to the river. The problem was they didn’t have the land to do it, and therefore would have to have the city agree upon putting it on city land, in particular in Hamel Park.

The City Council was quite receptive to the idea, but not Glover. In a thinly-disguised power play in order to extract money from the RRWC to pay for projects Glover valued, and had asked it to fund, but that the city could not afford as it tries to survive a strained budget that has been the hallmark of Glover’s administration, he said he wouldn’t sign unless they added the others. The RRWC stuck to its guns in stating it would fund only this project a long-standing request for many years to them by citizens who organized themselves as the Shreveport Dog Park Alliance, and only river front items.

Economic wisdom shown by refinancing proceeds now

While half-wise isn’t as good as totally wise, it’s much better than stupid, although certain pundits and politicians would have you believe otherwise.

That’s how to judge the reaction to the Gov. Bobby Jindal Administration’s completion of refinancing of debt tied to the massive tobacco settlement of 15 years ago. The state took money upfront from it for the majority of the value of the annuity in exchange for periodic payments to the lenders, backed by the annuity payments. At the beginning of the year, the Administration started the refinancing process to lower those payments to take advantage of very low interest rates.

When completed, the state saved about $83 million. But had the timing been just a bit better, with the sale having come perhaps a month earlier, it could have reaped another $59 million as rates went up in the interim. This has brought criticism from some predictable sources trying to use this as a tool for political gain, both using the same flawed argument.

Independence Day, 2013

This column publishes every Sunday through Thursday after noon (sometimes even before; maybe even after sundown on busy days) U.S. Central Time except whenever a significant national holiday falls on the Monday through Friday associated with the otherwise-usual publication on the previous day (unless it is Independence Day or Christmas when it is the day on which the holiday is observed by the U.S. government). In my opinion, there are six of these: New Year's Day, Memorial Day, Independence Day, Veterans' Day, Thanksgiving Day, and Christmas.

With Monday, Jul. 4 being Independence Day, I invite you to explore the links connected to this page.

Ruling encourages adopting defined contribution plan

It’s not exactly back to the drawing board for the next phase of pension reform in Louisiana, but at least the opportunity to come up with something better presents itself, all the while recognizing that doing nothing is not an option.

With only a slight amount of stretching the state Constitution, the Louisiana Supreme Court last week declared that passage in 2012 of a cash benefit plan for new hires into state government did not have the requisite votes, and thereby invalidated the law that was, after an instrument passed in this year’ session, to take effect a year from now. The Constitution says that any actuarially change predicted as negative, even if really indeterminable and largely guesswork, to retirement fund solvency requires a two-thirds vote of the seated membership for passage in each chamber, and the House fell a couple short.

Using a bit of creative license – despite the Constitution’s not specifying that this applied to future plan members, the Court strung some statutes together and tortured the mix to say that it somehow did – to wipe the statute away, this eliminated a minor but useful means by which to defuse the ticking time bomb that is the state’s unfunded accrued liability, now in the neighborhood of $20 billion and costing taxpayers an extra $1 billion or so a year to finance.

Court error on formula decision comes back to haunt it

The lack of logic in the Louisiana Supreme Court’s decision that invalidated the state’s funding formula for schools got exposed by a suit of a school board and union representatives that could cost the state a couple hundred million dollars – but gives the Court the opportunity to fix its error.

Earlier this spring, during the legislative session, the Court ruled that the funding formula from last year was unconstitutional, partially on the basis of when it was dealt with by the Legislature. Each year, the Board of Elementary and Secondary Education concocts this formula, where a majority passes it on to the Legislature that only has the power to approve or disapprove. If disapproving, BESE can try again, but if no concurrent resolution encapsulating it is passed by both chambers, then the formula last enacted continues to get used.

The Court declared the 2012-13 version void on the basis that the instrument presented as the vehicle for the formula, even if designated as a concurrent resolution, was really not, but took on the characteristics of a law because, in its opinion, the instrument acted like a law, because most of the time historically its path to legislative approval replicated that used for laws (even though evidence it presented to substantiate that, such as a trip to the Legislative Bureau, is not defined in the Constitution or by statute, unlike what are bills to become laws and what are resolutions). This is despite the fact that it creates no statute, which mimics appropriations bills that way that are considered laws but differs from them in that it does not apportion specific amounts but creates a formula that may be adjusted by specific amounts.

Strain deferral signaling Vitter in for governor's race?

In a sign that perhaps Sen. David Vitter has come to an affirmative decision that he’ll make a gubernatorial run in 2015, Agriculture Secretary Mike Strain announced he would seek reelection to that post.

Strain posted through social media the decision, significant because he was the only prominent principled or traditional conservative candidate putatively in the contest. Others at the state level who have announced interest in the job to succeed term-limited Gov. Bobby Jindal represent different political bases – Lt. Gov. Jay Dardenne seems positioned to appeal to moderates on the right and independents, Treasurer John Kennedy for years has spouted issue preferences that appeal to populist conservatives, and state Rep. John Bel Edwards reliably parrots lines that liberal Democrats love.

As far as this group went, Strain could find room to try to capture that constituency with the only potential competition from state Sen. Gerald Long, who also expressed some interest. But Long raised hardly any money in 2012 although he retains almost $300,000 in the bank. Strain did much better, raising over $200,000 and left with nearly $400,000 in the same time period, so it seems highly unlikely that Long, if the distant kinsman of two past governors even still contemplates making the race (at one time saying a crucial factor in deciding to go for it was his ability to raise money), chased him out of it.

Bossier City voter apathy sabotages good governance

Attentive Bossier Citians got a rude reminder with its recent inauguration of its next government. In a democracy, ultimately we get the government we deserve. That’s Bossier City citizens have allowed about $100 million of their money to walk out the door over the past 15 years, because, as the recent city elections showed, they just don’t care enough.

The latest folly performed by city government was a needless $26 million giveaway of land, cash, expenses, and promises to a local developer. What prompted it is unclear, as it resulted from a legal settlement, but it appears that Bossier City’s government negotiated in bad faith with the developer, which became public only over a dispute about curb cuts. That cost each citizen about $414 that could have been avoided.

Yet even with this latest reminder of a string of bad decisions over those years, with many of the same people who made them running for reelection this time out – comprising six of the seven council districts and the mayor’s office – only one council member opted out, only one drew a challenger, and the only other one with competition saw a rematch of a previous special election that did not feature an incumbent, plus another challenger this time. This in and of itself was a sign of apathy that only two competitions out of eight occurred, and only one featured a politician who played a part in the bad decision-making.