Barbour urges lawmakers to approve new Medicaid formula

Published 3:25 pm Wednesday, May 28, 2008

Gov. Haley Barbour is asking the Mississippi House and Senate to approve a complicated new formula to plug a $90 million hole in the Medicaid budget, but some lawmakers want detailed information about how their local hospitals would be affected.

“I hope he don’t think we’re going to do this quick just because he wants us to,” House Public Health Chairman Steve Holland, D-Plantersville, said Tuesday after Barbour and the Mississippi Hospital Association revealed the plan.

A special session started last week, and it’s unclear how long lawmakers might remain at the Capitol. They still have several unfinished pieces of business, including agreeing on a plan to keep the state employment agency open beyond June 30 and considering an increase in the weekly unemployment compensation.

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Senators on Tuesday passed a bill that would require employers to verify workers’ immigration status. The bill would revise a law that legislators enacted during the regular session that ended last month. The new measure moves to the House for more work.

Under a Medicaid plan Barbour explained to lawmakers Tuesday, hospitals would have to pay a single new tax to replace three old taxes.

The new tax would be based on days of patient care a hospital provides — so, one person in a hospital for five days would count as five patient care days. One of the taxes under the old formula was a bed tax, and a hospital would pay a daily tax regardless of whether a patient is in the bed.

The governor said for every $1 the hospitals put in collectively under the new plan, they would get about $6 in return.

Rep. Robert Johnson, D-Natchez, asked whether patients with private insurance can expect to pay for hospital care if the new tax is approved. Barbour told him that if the Medicaid budget is not fixed, “hospital rates would be astronomically higher” because costs would be passed on to people with insurance.

“So as a politician,” Johnson asked, “I can give my one-liner and I can tell the taxpayers that I’m saving them money?”

Barbour replied: “Even as a mathematician you can say that you’re saving the taxpayers.”

The governor said most of the hospitals would receive more money than they have been receiving, but about 20 percent would receive less. Generally, he said, hospitals with many poor or uninsured patients would fare better under the new proposal.

Medicaid provides health coverage for the needy, aged, blind and disabled and for low-income families with children. It is paid with federal and state money. Because Mississippi is a poor state, it gets a generous federal match — for every $1 the state pays, the federal government pays nearly $4.

The federal government said several years ago that Mississippi had to stop using part of the Medicaid formula that had been in place since the early 1990s, but the state has delayed fixing the problem by using other sources, including millions of dollars the federal government sent for Medicaid after Hurricane Katrina in 2005.

The temporary solutions ran out this year, and legislators ended their regular session in April without resolving how to cover the final $90 million for Medicaid for the budget year that starts July 1.

The Mississippi Hospital Association has paid a consultant $350,000 to come up with the proposed new formula, and association director Sam Cameron said he hopes lawmakers will approve the plan.

“It has been long. It has been complicated. It has been frustrating,” Cameron said of trying to find a plan that could work.

The bills are Senate Bills 2005 and 2001.