New details on the “Louisiana Health First” initiative were just announced by Governor Bobby Jindal. The Governor stressed that the state is last in healthcare outcomes and has far too many people with no health insurance at all, so it is very important for the state to take action. The initiative focuses on expanding health insurance, providing coverage for the working poor and offering Medicaid consumers choices on insurance coverage rather than have a government one-size-fits-all system. Governor Jindal added “the state’s rapid growth in spending with continued poor outcomes is not acceptable and is not financially sustainable for the state.”
According to state DHH Secretary Alan Levine, Louisiana is 42 in per capita income, but the state’s total state spending on Medicaid and the uninsured is very high. In the last two years, the Medicaid budget has grown by more than $1.6 billion resulting in a 28 percent growth. Medicaid spending has grown from 8.5 percent of the state’s general fund two years ago to more than 16 percent today. It is expected that this spending will consume nearly 22 percent of available discretionary dollars by 2011.
DHH and HHS have been having ongoing discussions to resolve the issue of the $771 million potentially owed by the state for alleged overspending in Medicaid in the past. The state should invest this money instead to expand access to health insurance, according to Levine. The state has also asked the federal government to freeze the interest on this money which would allow Louisiana to invest this additional $100 million savings in expanded access to insurance, and to provide for the repayment over a five year period rather than pay it back over the traditional 15 to 21 months.
The state is proposing to expand Medicaid by transforming Medicaid into a system where the beneficiaries will not only have insurance but also transparency. The system needs to have incentives aligned for better health outcomes at a more reasonable rate of growth in cost.
In addition, the state is planning to change the governance of Charity Hospital in New Orleans to create a state-of-the-art teaching facility that can invest properly in research and training and compete head to head with the most prestigious teaching hospitals in the country. The Academic Medical Center would provide for payments and care for the uninsured and residency programs with LSU and Tulane.
One of the Initiative’s goals is to develop the medical home system. The Health Care Reform Act passed in 2007 was put into place to develop and implement a healthcare delivery system providing a continuum of evidence-based and quality driven healthcare services. These services are to be provided based on the medical home system of care using successful managed care reimbursement principles.
To meet these goals, the medical home system of care would need to:
- Coordinate and provide access to healthcare including convenient and comprehensive primary care plus access to appropriate specialty care and inpatient services
- Provide for strong and effective medical management
- Use health outcome data to ensure that patients and providers improve outcomes
- Require the use of electronic medical records
- Provide quality of care and cost efficiency through performance measures
- Provide for adequate reimbursement levels to ensure quality providers
