Published: August 28, 2008 01:29 pm         

Judge holds off on decision about Medicaid funding

JACKSON — A judge says he is holding off on a request by hospitals to stop Gov. Haley Barbour’s latest Medicaid funding plan.

Hinds County Chancery Judge William Singletary said late Wednesday that the plan would need to get federal approval and go into effect before he could consider blocking it.

Several hospitals filed a lawsuit to try to stop Barbour’s plan to tax hospitals to generate money for Mississippi’s struggling Medicaid program. Hospital attorneys argued to Singletary Wednesday that the governor’s new plan is the same one Singletary had already ruled against, just “dressed up a little bit and the name changed.”

Hospital attorneys George Ritter and John Sneed argued that the new proposal from Barbour and the Division of Medicaid is a copy of the governor’s 2006 plan to levy a tax on the hospitals.

Singletary ruled in July that Medicaid didn’t have the authority to set taxes or fees that hospitals must pay. He said only the Legislature has that power.

Ritter said the new proposal violates Singletary’s order.

Medicaid is facing a $90 million shortfall in the current fiscal year. When Barbour unveiled his plan earlier this month, he said it would generate $88 million of the shortfall by increasing the gross revenue assessment on hospitals, which Medicaid can do without legislative approval. Another $2 million would be generated through cuts of less than 1 percent on provider services.

Hospitals balked at the proposal, saying it would lead to job losses and other budget woes at health care facilities.

“They’re going to send out notices next week about the tax on hospitals,” Sneed said. “Many of them are not going to be able to sustain operations.”

Steve Thomas, a private attorney hired by the governor’s office, told Singletary that the plaintiffs were getting ahead of themselves.

Thomas said the proposed provider cuts are still going through an administrative process. Until that’s complete, the assessment cannot be triggered. He also said the overall proposal has to be approved by the U.S. Centers for Medicare and Medicaid Services.

“They’re putting the cart way before the horse,” said Thomas, who was hired after Attorney General Jim Hood said his staff wouldn’t represent the governor.

Hood is a Democrat and Barbour is a Republican. Hood said he couldn’t represent the governor because the attorney general’s office can’t get involved in a dispute between the executive and legislative branches of government. Fourteen Democratic state senators this week filed a “friend of the court” brief in support of the hospitals’ legal challenge.

Medicaid provides health coverage to about 1 in 5 Mississippians, mostly children, the elderly and the poor. The program has faced budget woes in recent years, and lawmakers and others attribute the problem to the use of one-time money, or nonrecurring funds. Federal rule changes a few years ago left a $90 million budget hole in the program, which is paid for with state and federal dollars.