Levine pitches plan to patch shortfall

Louisiana’s health chief proposed Tuesday using one-time money to fill three-fourths of a $308 million projected shortfall in the state’s $6.5 billion Medicaid program.

State Department of Health and Hospitals Secretary Alan Levine called the plan “a balanced approach” that will — for now — shield private health-care providers from another round of cuts.

Gov. Bobby Jindal and some legislative leaders have opposed use of one-time funding for recurring state expenditures.

Medicaid is the government’s health insurance program for the poor, providing coverage for 1.2 million of Louisiana’s 4.4 million residents.

DHH projects that expenditures will outpace dollars appropriated for payments to private hospitals, nursing homes, pharmacy, laboratory and X-ray services.

The $231 million, which includes some federal stimulus dollars and a financial settlement as well as proceeds from a special account, will help bridge the gap, Levine said.

The Joint Legislative Budget Committee, which must approve many of elements of Levine’s proposal, won’t likely vote on the issue until December, Vice Chairman Rep. Jim Fannin said.

Fannin, D-Jonesboro, said there is no need to “over-react” to DHH projections, which could well be inflated because they are based on only three months of data.

“These are projections,” he said.

Fannin and state Rep. Chris Hazel, R-Pineville, recalled how DHH last year proposed cuts based on similar data only to determine later that the numbers didn’t hold up.

Levine said it is the best estimate DHH can provide today.

State Sen. Lydia Jackson, D-Shreveport, said the agency should not be looking at absorbing the entire deficit.

“We keep hearing how we are achieving other savings in the budget,” Jackson said. She suggested checking with the governor’s Division of Administration to see if there is a potential for budget relief.Levine said he is suggesting use of one-time money to help close the potential funding gap since some of the expenses, such as those surrounding H1N1, are not expected to be an on-going expense next year.

He also said he did not want to propose a new round of budget reductions on private health-care providers — some of whom have been hit twice in the last year.

Levine’s plan also calls for taking funds away from mental-health and public-health agencies as well as the LSU public hospital system to cover a potential shortfall in Medicaid programs that pay private health-care providers.

Fannin and Jackson questioned the wisdom of taking funds away from the LSU hospitals given increasing demand for services.

The state funds would be diverted to the Medicaid program where the dollars could attract an increased federal match and help cover private sector Medicaid health-care expenses.

“We need to look at that very carefully,” Jackson said.

Fannin said he didn’t want to be taking money away now and then running into a shortfall later at the LSU hospitals that had to be filled.