Gov. John Bel Edwards, a Democrat, said he didn’t have much choice but to sidestep the Louisiana Legislature and use an emergency measure to renew $15.4 billion worth of Medicaid contracts without the lawmakers’ permission.
“At the end of the day, in order to keep the Medicaid program in place and operating, so that the most vulnerable among us can get access to quality health care, this is the best route forward,” Edwards said during his monthly radio show Wednesday (Nov. 22).
The Republicans who run the House Appropriations Committee have declined three times over the past month to renew contracts with five private companies that coordinate most of the state’s Medicaid program. They’ve been pushing for the Edwards administration to include more oversight provisions in the agreements before granting approval. The Edwards administration doesn’t believe the oversight provisions the House Republicans requested are necessary.
Due to the political standoff, Edwards said he couldn’t be sure the House Republicans would ever renew the Medicaid contracts, which govern health care for 1.2 million people in Louisiana, including over 700,000 children. The current arrangements expire Jan. 31 and are worth about a quarter of Louisiana’s operating budget.
If the contracts never got approved, the Edwards administration said it would throw Louisiana’s health care system into chaos. The Louisiana Department of Health would have to hire hundreds of people to go back to its old way to managing Medicaid, called a fee-for-service a model, the governor said. The federal government also hasn’t signed off on Louisiana using a fee-for-service approach to Medicaid either, which would be necessary to change Medicaid’s management.
“The fact is Louisiana doesn’t have the staff to revert to a fee-for-service model,” Edwards said.
The Edwards administration has also said the rejecting the contracts would the Medicaid program to run out of money in April, blowing a $350 million hole in the state’s current operating budget.
So the governor decided this week to use a state rule to move forward with the arrangements on an emergency basis, justified by an imminent threat to public health. In doing so, Edwards has cut the Legislature out of the process completely and won’t have to give into the House GOP leadership demands for more oversight of Medicaid spending.
Many lawmakers aren’t happy about the new “emergency contracts” rammed through by the governor. The House Appropriations and Senate Finance committees were expected to vote on the Medicaid contracts again in December — and a few conservative Republicans sitting on the committees said they would most likely have gotten approved.
House GOP members aren’t interested in reverting to a fee-for-service Medicaid program. The stalemate over the Medicaid contracts has been much more about a political power struggle than a substantive different of opinion, several said.
Philosophically, House Republicans like contracting Medicaid services out to private companies, a model that was first implemented under Gov. Bobby Jindal and that saves the state money. Indeed, the Senate Finance Committee — which is also controlled by Republicans — has already voted for the Medicaid contracts presented by the Edwards administration once, even if the House has not.
But Edwards decision to go around the Legislature has upset several lawmakers on the Appropriations and Senate Finance committees, including a few who had been siding with the governor in the fight over the Medicaid contracts this month.
State Rep. Reid Falconer, R-Mandeville, was one of just two Republicans on the House Appropriations Committee to vote with the governor on the Medicaid contracts last week, when they failed to pass for a third time. But Falconer was upset Tuesday when he found out Edwards had decided to cut legislators out of the contracting process entirely.
“Our Constitution establishes an order for how our government works. Gov. Edwards should not bypass that order,” Falconer wrote in a tweet, linking to an article about emergency contracts.
— Reid Falconer (@Storeid) November 22, 2017
State Sen. Sharon Hewitt, R-Slidell, had also voted for the Medicaid contracts Edwards was pushing as a member of the Senate Finance Committee earlier this month, but she was not pleased that Edwards had decided to go around lawmakers either.
— Sharon Hewitt (@sharonhewitt) November 21, 2017
In an interview Wednesday, Sen. Conrad Appel, R-Metairie, said he was confident the Medicaid contracts would have been approved in December if Edwards had waited. Even if the governor had not taken the House Republicans’ suggestions on the oversight language, the GOP would have been forced to approve the contracts, because of the problems rejecting the arrangement would have otherwise caused, he said.
“It’s violates a trust that the people have placed in the legislative process,” said Appel about Edwards’ decision to implement “emergency” agreements with the Legislature’s approval.
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Julia O’Donoghue is a state politics reporter based in Baton Rouge. She can be reached at email@example.com or on Twitter at @jsodonoghue. Please consider following us on Facebook at NOLA.com and NOLA.com-Baton Rouge.