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“Crystal Ball”: Health Care Funding Future Unclear

“Is your hospital next?” asked a sign prominently displayed during a February 11 rally on the state Capitol steps, protesting the planned closure of Baton Rouge General’s Mid-City Emergency Room. With that ER shutting down tomorrow—an unintended consequence of privatizing Louisiana’s charity hospital system—it’s a question that continues to trouble Baton Rouge Rep. Patricia Smith.

“Do you have any idea on whether or not we might see something similar happening across the state?” Smith asked DHH Secretary Kathy Kliebert during a House Appropriations hearing on the proposed 2016 state budget.

“There are going to be hospitals that struggle, as we saw here with Baton Rouge Mid-City,” Kliebert admitted.

Some $407-million in potential health care funding may not materialize for the next fiscal year, as it is based on cutting the refundable portion of more than a dozen tax credits. DHH Undersecretary Jeff Reynolds said the resulting reductions would mean a ten-percent cutback in rural hospital funding, plus lowering reimbursement rates for all providers. The biggest cuts would be felt by the public-private hospital partnerships.

“There would be a 33-percent reduction in supplemental payments top the public-private partners,” Reynolds told the Appropriations committee.

The governor’s budget proposal is already $142-million shy of what the private partners requested.

“Do you foresee a possibility of these partnerships coming back to the table, backing out?” Smith quizzed Kliebert. “What’s your crystal ball vision there?”

“Certainly, I would see the possibility of some of the partners coming back and requesting to be out of their agreement,” Kliebert admitted. “Or they would have to significantly reduce services.”

“Will we see people just not getting care at all?” Smith wondered aloud.

Smith then pushed Kliebert—who has been reticent to reveal any of DHH’s planning for a worst-case scenario—to acknowledge how bad things could actually get.

“Since we are already in a very detrimental place when it comes to health outcomes, that would be even more detrimental to us, as a state. Wouldn’t you agree?” Smith pressed.

“I certainly would agree. Yes,” Kliebert responded.

If the public-private partnerships crash and burn, it’s unclear who will provide medical care for Louisiana’s poor and uninsured.