Louisiana treasurer says hospital privatization plan won't save any money

Louisiana's treasurer has condemned the state's plan to privatize its publicly-operated hospitals, saying it will never realize the savings advertised by the Jindal Administration.

Instead, John Kennedy, writing in the News-Star, said the privatization is actually intended to leverage more money from the federal government for its Medicaid program. Louisiana would use the lease payments it receives from the private operators as leverage to draw down additional federal matching funds of Medicaid dollars.

"This accounting maneuver is undeniably clever. The question is whether it is legal," wrote Kennedy, who has been elected Louisiana's treasurer four times.

Louisiana's Legislature voted late last year to privatize the state's public hospitals as a way to balance the budget.

Kennedy noted in the opinion piece that the Centers for Medicare & Medicaid Services has rejected past proposals from the Bayou State for leveraging additional Medicaid dollars.

In Jefferson Parish, the parish council has delayed a vote to privatize two public hospitals because of process concerns raised by Louisiana Inspector General David McClintock, the New Orleans Times-Picayune reported. There has also been an apparent conflict of interest involving an outside consultant guiding a potential deal.

"I would not be in favor of a vote before responding to the inspector general's report, and I think the council is all in favor of that, too," Parish Council Chairman Chris Roberts told the Times-Picayune.

To learn more:
- read the News-Star opinion article
- here's the Times-Picayune article

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