Louisiana State Senator Challenges Health “Reform” Plans

Twenty-nine and counting.

That’s the number of states in which legislators have introduced, or plan to introduce, legislation challenging the House or Senate health care bills that include a personal mandate, sweetheart deals (Cornhusker Kickback), and commandeering of state offices.

According to the Pelican Institute for Public Policy, A.G. Crowe, a member of the Louisiana Senate, “has authored legislation that seeks to ‘Prohibit state or local governmental coercion of any Louisiana employer, health care provider, or individual to compel participation in any health care system or health insurance plan.’”

Among the legal objections to the House and Senate bills: They violate the Equal Protection clause, the Interstate Commerce Clause, and a recent Supreme Court ruling on the relationship of the federal government to the states.

Would You Like a California Cash Cow or New York Pork With Your Florida Flim Flam?

California’s recent budget deficits will look bush league relative to the fiscal hurricane that federal health reform will unleash on California and many other states.   The problem stems from the expansion of Medicaid, the program for low-income residents, jointly funded by the federal and state governments.

Most observers anticipate that if President Obama does sign a bill this year, it will look more like the Senate bill (an amendment to H.R. 3590), which would pull millions of Americans into government dependency for their access to medical services via an expansion of Medicaid.

The Congressional Budget Office (CBO) reckons that 15 million more people will enroll in Medicaid if the Senate bill becomes law (p. 8), which is just a whisker less than half the total number of persons the CBO forecasts will be newly insured, 31 million, as a result of the “reform.” This is like the government stating that it will reduce the number of jobless by putting millions more on welfare and classifying them as “employed.”

From 2014 through 2016, the federal government would cover the entire cost of roping these people into Medicaid. By 2019, however, the federal government would pay only about 90 percent of the costs of Medicaid expansion, leaving the states to pick up 10 percent. That’s how it was supposed to work, until we learned about elements in the bill such as the “Cornhusker Kickback.”

Senate Majority Leader Harry Reid bought Senator Ben Nelson’s vote in favor of the bill by promising that Nelson’s state of Nebraska would never have to pay for any of the Medicaid expansion. The federal government or, more properly, the taxpayers of California and 48 other states, would pay for Medicaid expansion in Nebraska. Similar deals for other senators were labeled the “Louisiana Purchase” and the “Florida Flim-Flam.”

Some governors are getting pretty uncomfortable with the way the deal has been hammered out. In a pre-Christmas letter to Speaker Nancy Pelosi, Governor Schwarzenegger charged that the federal plan levied an unfunded mandate on California that would cost the state $4 billion to $5 billion.  But he’s unlikely to get a “California Cash Cow.”

Many states, including California, have long since convinced the federal government to allow them to increase Medicaid eligibility. Of course, this has allowed them to draw down even more federal dollars. (Before the February 2009 “stimulus” bill, the federal government paid for 57 cents of each Medicaid dollar, on average.) Because these states have already bloated their Medicaid programs, they will not enjoy the bailout the federal “reform” offers states that have limited Medicaid enrollment to date.

One of the 24 measurements in the U.S. Index of Health Ownership is the level of Medicaid eligibility. A state scores low if it has recklessly expanded government dependency in this way. In the third edition (2009), California ranks 30th out of 50 states but plenty of states do worse. Consider New York, a lowly 45th in the Index’s measurement of Medicaid eligibility.

“We are, in a sense, being punished for our own charity,” moaned Governor David A. Paterson, in response to the proposed Medicaid funding formula. “Charity” is an interesting noun to describe the Empire State’s approach to Medicaid. Last July, New York State and New York City agreed to pay the federal government $540 to settle allegations from the U.S. Department of Justice that they had submitted false Medicaid claims! A December 26 audit by state Comptroller Thomas DiNapoli accused the state’s health bureaucrats of recently approving $92 million in fraudulent payments.

Wendy Saunders, New York’s Deputy Secretary of Health, now shamelessly suggests a heaping plate of “New York Pork.” She thinks the federal government should throw an extra $30 billion New York’s way over 10 years, above what’s currently in the Senate bill. Unfortunately, in order to convince its stenographers in the media that the “reform” is deficit neutral, the majority took such drastic steps as proposing a luxury tax on tanning salons and cutting about $400 billion from seniors’ Medicare benefits.

All this comes in order to fund a significant expansion of government, a plan supposedly too big to fail. Governors Schwarzenegger and Paterson, and their long-suffering taxpayers will soon learn, however, that the feds are unlikely to find the dollars for more bailouts.

Landrieu’s Folly: Gain for Louisiana is Short-Term

By now you’ve read that Sen. Mary Landrieu (D-La.) sold her vote on a “motion to proceed” on the Senate health reform bill for a cool $300 million in extra Medicaid money for her state.

But the Pelican Institute for Public Policy, a Louisiana-based organization, says that these short-term benefits will bring long-term pain for the state. “Do not be fooled into believing Landrieu is helping the state of Louisiana. If the proposed healthcare legislation were to be signed into law, the $300 million allocated to Louisiana will pale in comparison to the long-term debt Louisiana citizens will ultimately shoulder.  Landrieu has done our state no favors by displaying that she, like so many other politicians in the state of Louisiana, has a sweet spot for cash.”

How Much Will Free Health Care Cost Louisiana?

The Pelican Institute, a Louisiana-focused organization, says that health reform "based on President Obama's principles" will cost the state significantly.

Specifically, economic growth  will be 4.3% lower over a 10-year period than it would otherwise be. In addition, "the current net present value of funding health care reform based on President Obama's priorities will be $4,427 for every person in Louisiana."

You can read the report (PDF) here.

Louisiana Legislator Says “No National Plan for Us”

A pushback among state legislators against a national takeover of health care continues, this time in Louisiana.

Rep. Kirk Talbot (R-River Ridge) "wants to protect state rights in the health-care arena via a constitutional change he will seek in 2010."

It's doubtful that such an amendment would have legal power to block any legislation coming out of Congress–the centralization of political power in Washington, DC is a train that has left the station a long time ago–but it would be a useful tool in the political arena.

U.S. Index of Health Ownership 2nd Edition Is Here

Pacific Research Institute has published the 2nd edition of the U.S. Index of Health Ownership, the only ranking of health care in the states that uses criteria of individual choice.

Americans lack the basic freedom to make their own health care decisions. The Index measures the degree to which individuals, be they patients, health professionals, entrepreneurs, or taxpayers, “own” the health care in their states.

The lack of health ownership is a real problem. Almost half of the country’s health care spending is in the hands of the government, instead of patients themselves. The other half is governed by regulations inflicted upon doctors, health plans and patients.

The Index uses 24 variables to quantify how state laws and regulations affect the liberty of citizens involved in state government health plans (primarily Medicaid), the private health-insurance market, and the provision of medical services. It also assesses the effect of medical tort on people’s freedom to engage health services.

Alabama, Montana, Nebraska, North Dakota, and New Hampshire finished in the top five, as the states that allow their citizens the highest degree of health ownership. Alabama leads the pack primarily because of a lightly regulated private insurance market, and good control of state government programs. Also, the state performs well on medical tort indicators. Alabama’s regulatory environment for providers favors competition, and government health programs run more effectively than in most states.

New York, Massachusetts, Rhode Island, Vermont, and North Carolina rounded out the bottom five, as the states in which the government has taken the most undue control of health care from its citizens. This is the second year that New York was in last place. The state suffers from government health-care programs that are out of control, a grossly overregulated private-insurance market, and almost completely uncompetitive provider markets.

A full listing of all 50 states and their rankings is contained in the Index.

The Index will give concerned citizens a good basis to demand reforms from their state politicians that will put American families in charge of American health care, instead of government and special interests.

Government Rationing through Medicaid

Want to see government rationing in action? You don't have to to go Canada. Just look at Medicaid, which practices rationing by steadily cutting payments to doctors, who in turn stop seeing new patients.

Louisiana is going to cut payments by $180 million. As a result, "private health-care providers worry that the cuts could result in private physicians leaving the Medicaid program and hospitals reducing services and laying off employees."

Freedom for Health Care Professionals

A committee in the Louisiana House has moved forward legislation to extend freedom of conscience to people in the health care field. It's an interesting story once you consider the reach of government in health care.

According to the Baton Rouge Advocate, "HB517 would permit health-care workers to refuse to participate in any medical service 'that violates his conscience.' Conscience is defined as religious belief or moral conviction."

At first blush, I think this is a good idea. Then again, it puts the law in between the employer-employee relationship (nothing new there, of course!) and thus violates freedom of association and freedom to contract.

At best, the law should apply to government-owned facilities, since the burden on government to be neutral towards religion is higher than it is for private parties. Then again, government is so involved in health care as it is that it may be impossible to neatly draw a line between employers that should be allowed to "discriminate" (to use a popular word) than those that should not.

The Strange World of the Medicaid Match: Louisiana Edition

Federal matching funds for Medicaid entice states expand programs when times are good–a move that comes back to bite them when tax receipts fall and demand on the program increases. And now a recent splurge of federal (and other) spending in Louisiana is affecting its Medicaid budget.

The state received a large boost in federal spending as well as insurance money after Hurricane Katrina. Thanks to the way that the feds calculate the states' income for matching funds purposes, Louisiana has received a delayed bump in its reported income.

This means that it's eligible for a smaller federal match, a situation that Alan Levine, the state's health policy chief calls "cataclysmic." He wants the federal government to revisit the question.

Time for Tough Decisions on Medicaid

With the recent passage of the massive $785 billion federal stimulus bill in Congress, state leaders in Kansas are awaiting their bailout which could prevent them from making the tough decisions necessary to bring fiscal sanity back to the Sunflower State.

There are models for Medicaid reform in Florida and most recently in Louisiana (PDF) which should be considered for Kansas. They involved pilot programs in counties (one in Louisiana and two in Florida) that are focused on improving health outcomes for Medicaid recipients, providing choice of networks for the health care of recipients, and even involving an opt-out to move beneficiaries from public to private insurance. In spite of the recent economic downturn, and the constant fear that Medicaid numbers swell during bad times, Florida and Louisiana are moving ahead with their reforms.

States taking the lead in reform during bad economic times may be better poised to be leaders in health care reform once recovery comes about. The states simply waiting for a bailout or a stimulus from the federal government, as Kansas is positioned to do by its political leadership, may be left out in the cold once the recovery occurs. Why? Flush with funds for the short term from the federal government will not be enough to stave off the looming fiscal problems over the long term that may accrue after the federal funds are cut off.

The pursuit of reform should not be deferred by bad economic times. Indeed, those times show more than ever why reform is necessary.