BATON ROUGE – Republicans on the House budget-writing committee questioned the spending growth in Louisiana’s Health Department, taking aim at plans to pump another $2 billion in federal money into Medicaid.
Gov. John Bel Edwards proposes spending $14.2 billion on the Health Department in the financial year that begins July 1, nearly half the money allocated in the state operating budget. More than $10 billion of the health spending is federal money.
“This is growing uncontrollably,” said Rep. John Schroder, a Republican from Covington.
Health Secretary Rebekah Gee pushed back against the criticism Wednesday, saying the budget has grown because Louisiana is offering Medicaid coverage to more people, particularly through the Medicaid expansion. The expansion largely has been financed with federal money, and she said it’s helping people get better health care.
“You cover more people; it costs more money,” Gee said. “This is a federal investment in Louisiana that I would argue we deserve. We have the sickest people in the nation.”
Schroder responded: “Whether it’s federal money or state money, it’s the taxpayers’ money.”
Louisiana’s state spending growth on Medicaid over the past 15 years is below the national average, about 6.7 percent compared with 7 percent nationally, according to a nonpartisan House Fiscal Division analysis. The analysis said Louisiana’s per capita state general fund spending on Medicaid also is less than the national average.
Despite that data, Republicans said they worried costs are climbing.
Rep. Bob Hensgens, an Abbeville Republican, questioned whether the department modeled what would happen if Congress dropped the high federal payment rates for Medicaid expansion.
Gee said she doesn’t think such proposals are viable. Jeff Reynolds, chief financial officer for the Health Department, said if that happened, “the state’s either got to pony up more money or start kicking people off the rolls.”
Edwards is proposing to add more dollars to the Health Department budget if lawmakers support tax changes that would raise charges on business. Republican members of the House Appropriations Committee are resistant to that idea.
Rep. Tony Bacala, R-Prairieville, said the Health Department could more deeply cut travel and professional services contracts. Schroder, Baton Rouge Rep. Rick Edmonds and other GOP lawmakers questioned whether the agency was doing enough to combat fraud and waste.
“This is one example of an efficiency that has to be solved before we turn to taxpayers and tell them, ‘Hey, we need you to pay more,’ ” Schroder said.
The Legislative Auditor’s Office recently created a unit to review spending in the Health Department and said it has found nearly $15 million in erroneous and questionable payments so far. The attorney general’s office also is working on the effort.
“I look at both of these offices as tools you’ve given to this department to help improve the program,” Reynolds said. “We take these items seriously.”
The agency is proposing to reshuffle hospital payments, with the state’s safety net hospitals taking a cut of 6.2 percent, or $84 million. Gee said the effort is aimed at balancing payments to all of Louisiana’s hospitals for uninsured and Medicaid care, rather than disproportionately sending money to the private operators of charity services previously run by LSU.
But she worried cuts would be passed onto the graduate medical education programs that use the privatized LSU facilities.