Why does identified unneeded health spending continue

Surely there is something more to the Joint Legislative Committee on the Budget’s not approving cost reductions deemed necessary by Louisiana’s Department of Health and Hospitals, potentially leaving a deficit in the state’s budget that only will grow without state action.

Secretary Alan Levine as required by law noted the Medicaid account deficit and reported it to the Committee, along with suggestions to deal with it. His recommendations to reduce the deficit by $79 million of the $81 million shortfall were to forgo starting a pilot program to revamp service delivery to the indigent, end duplicate payments to nursing home patients with hospice care (because hospice care largely duplicates the care in the nursing homes), end duplicate payments to hospitals, end overpayment on some services to hospitals (because of current rules allowing payment for services not clinically indicated by national criteria), and to rearrange rural hospital funding.

Senators on the panel thought it unwise to alter financing for rural hospitals, arguing that their uncompensated care dollars would be inappropriately cut. But on this and other items, state Rep. Jim Fannin, chairman of the House Appropriations Committee (this joint committee is made up of key individuals from legislative leadership and money committee members), wanted no action because he wasn’t sure the deficit figure was correct.


While caution may be warranted on the rural hospital financing changes and whether to initiate the pilot program now, it seems odd that identifiable wasteful state spending in the form of duplication or overcompensation should not be objected to and therefore allowed to continue, regardless of the figures. Why not act on those items and leave the other two for that further study, instead of inaction on all to allow waste to continue?

This makes one wonder whether there is more than meets the eye to all of this. Is there a push by hospitals and nursing homes, two of the most powerful sets of interests in the state and who have a large amount of their revenues coming directly from government, to stop this? As it would seem Louisiana taxpayers are on the hook for unnecessary higher expenses as a result of this decision, Fannin and others who supported this need to give an explanation.