Feeds:
Posts
Comments

Archive for the ‘Higher Education’ Category

False prophets, false profits—and false reasons to privatize LSU Hospital System (or trolling for more Medicaid dollars)

Posted in ALEC, American Legislative Exchange Council, Boards, Contract, Contracts, Governor's Office, Health Care, Higher Education, House, Senate, Legislature, Legislators, Privatization, Public Records, Transparency on September 29, 2013| 12 Comments »

Editor’s note: This essay is more than twice the length of our usual posts but with the takeover of LSU Medical Center in Shreveport and E.A. Conway Medical Center in Monroe set to take effect on Tuesday (Oct. 1), we felt it vital to provide more detailed information about the administration’s smokescreen that it likes to call a $125 million taxpayer savings. Please take the time to read it in its entirety.

False reasons for privatizing

The governor’s stated purpose of privatization was to improve quality, improve medical education, and save the taxpayers about $125 million (The Advocate 9/4/13).  His actions, however, support none of these stated purposes.

  • Improve quality?  There are many measures of quality, safety, and patient satisfaction that Medicare and others publish (see the discussion on NOLA.com September 14, 2013 story on East Jefferson and West Jefferson Hospitals).  Through a public records request I asked DHH what measures of quality they used in concluding that quality would be improved with these privatizations.  To no surprise, they did not attempt to review any data on quality despite this being one of the governor’s primary reasons for privatizing.  If you look at Medicare’s website http://www.medicare.gov/hospitalcompare/search.html  the LSU facilities compare very favorably to the new private partners.  Furthermore, the Cooperative Endeavor Agreements (CEAs) do not have requirements of the partner hospitals to measure, report, and be held accountable for any quality measures.
  • Improve medical education?  This is vintage Jindal.  He creates a crisis to force change then regardless of the outcome, declares victory for staving off the crisis he created.  Compared to not having hospitals to train in, the partnerships are better, but the public hospital system under LSU prior to Jindal’s meddling was very supportive of medical education and programs were performing well there.  Since the governor slashed funding for the hospitals, however, the programs ran into difficulty because of the governor’s actions.
  • Save taxpayers about $125 million?  Go back to the Medicare website (http://www.medicare.gov/hospitalcompare/search.html ) and compare the cost to Medicare for care delivered around a hospital stay at the LSU hospital and at the private partner.  In every case the care associated with the LSU hospital was much cheaper than the private partner.  The truth is the governor’s team never asked the private partners what their costs were.  In response to a public records request in which I asked DHH for their analysis comparing costs, DHH was unable to provide any documents demonstrating they compared the actual cost of care at the public and private hospitals prior to entering into the CEAs.  Even though the CEAs commit the state to paying the cost of care at the private hospitals, no one from the administration bothered to ask them what their costs were.  The LSU Board signed off on these agreements without knowing this basic information – an action they were willing to take with the public’s money but that none of them would be so irresponsible to do with his own business.

Here is the breakdown for all cost to Medicare for a patient from 3 days prior to hospitalization to 30 days after the hospital stay (from the Medicare website):

LSU     Hospital Private     Partner(s)
Medical Center of Louisiana     (Charity): $16,698 Touro: $20,022
University Medical Center     (Lafayette): $11,781 Lafayette General: $18,578
Leonard Chabert (Houma): $13,356 Terrebonne General: $18,961
Ochsner: $19,571
W.O.Moss (Lake Charles): $9,299 Lake Charles Memorial: $18,262
Earl K. Long (Baton Rouge): $12,017 Our Lady of the Lake: $21,133

 

So despite the governor’s claim, DHH has no evidence that these deals will save taxpayers $125 million and in fact the public data available indicate just the opposite.  The governor’s real plan is to quietly shift this added cost from state funds to federal funds.  It may save state funds but this approach does not match his public stance on rejecting additional spending, even federal funds since those are taxpayer dollars too.

 Examining the money

Why would the state agree to pay these private partners their costs without knowing how much that is?  Why would the state move its patient care from the lower cost state providers to higher cost private providers?  One explanation is that the higher cost will be borne by the federal government, not the state.  Last year, the public hospitals were appropriated $955 million.  Commissioner of Administration, Kristy Nichols, testified that in 2014 that number will exceed $1 billion.  As reported in The Advocate (May 28, 2013), “The total operating expense associated with the privatization of the LSU hospitals will hit $1 billion during the next fiscal year, Commissioner of Administration Kristy Nichols said Thursday. That’s more than there is in the current year’s budget – $955 million for the state to operate the charity hospitals…”

The private partners will participate with the state in a financing scheme that will allow the state to withdraw its support of the LSU hospitals while increasing the flow of federal funds.  The scheme involves at least 3 different components.  In isolation, each component may be (MAY BE) deemed allowable by the federal government but viewed together they demonstrate an effort to skirt federal requirements that the state put up its fair share of funding for the Medicaid program.

  1. Supplemental or extra payments from Medicaid to private hospitals using federal Medicaid dollars
  2. Lease payments including “up front” payments, in effect, the state “borrowing” funds from a private Medicaid provider (that it just prepaid a supplement using federal funds) in order to cover a state budget shortfall
  3. The state using the private hospital lease payments as match to draw more federal funds and then paying a portion of that back the private provider.

The entire process is designed to cut out the state support and increase the federal support.

Reducing state support

In September 2011 a consulting group named Verite hired by DHH submitted a business plan review that was considered by the Joint Legislative Committee on the Budget at its September 2011 meeting when it voted to approve contracting for construction of the new hospital www.newhospital.org.  The report points out the average state funds in the Interim LSU Hospital (ILH or “Charity”) from 2006 – 2011 was $42.8 million.  It projected an average annual amount of state funds in years 2015-2020 of $52.5 million necessary to pay for the cost of caring for uninsured people.  The JLCB approved construction based on these expectations.

However, the 2014 state budget includes zero state funds for ILH.  How can this be?

Here is the scheme:  The private hospital pays LSU money to lease the LSU hospital.  That money does not stay with LSU; it ends up (directly or indirectly) being used as match in the Medicaid program.  After matching those lease payments with federal funds, the total, larger amount is paid back to the private partner in the form of a Medicaid payment.   The lease payments supplant the state funds.  However, the legislative fiscal office has already raised concerns about the leases being $39 million short which is  why the Division of Administration has already begun planning on “double” lease payments this year.  http://www.nola.com/politics/index.ssf/2013/09/new_orleans_shreveport_hospita.html

For years states have devised schemes to receive additional federal funds while reducing the state contribution for Medicaid.  There is a problem with these schemes, however.  Consider this from a 2009 report by the Congressional Research Office:

“In 1991, Congress passed the Medicaid Voluntary Contribution and Provider-Specific Tax Amendments (P.L. 102-234). This bill grappled with several Medicaid funding mechanisms that were sometimes used to circumvent the state/federal shared responsibility for funding the cost of the Medicaid program. Under these funding methods, states collect funds (through taxes or other means) from providers and pay the money back to those providers as Medicaid payments, while claiming the federal matching share of those payments. States were essentially “borrowing” their required state matching amounts from the providers. Once the state share was netted out, the federal matching funds claimed could be used to raise provider payment rates, to fund other portions of the Medicaid program, or for other non-Medicaid purposes.”

https://opencrs.com/document/RS22843/

DHH’s current scheme includes a “borrowing” component that looks similar to the practices this legislation was aimed at preventing.  Medicaid rules do not allow a Medicaid provider (read “hospital” here) to voluntarily donate money to the state when they know they will get this money back plus more (the federal share) as part of an increase in their Medicaid payments.  The federal oversight agency, CMS, has already expressed concerns to state officials that these lease payments could qualify as non bona fide provider donations https://louisianavoice.com/2013/06/26/cart-ahead-of-the-horse-cms-letter-to-sen-ben-nevers-continues-to-leave-jindal-hospital-plan-approval-up-in-air/ and they will be examining the hospital leases to determine this.    If CMS determines these are conventional fair market value leases, they will allow the payments.  Beyond the basic annual lease payments, the deals include “double lease payments” and other large up front lease payments designed to fix the state’s budget problem raising the specter of non bona fide provider donations.  If these payments are deemed to be non-allowable, the federal government will recoup any federal funds that were paid as match for these state funds https://louisianavoice.com/2013/06/26/cart-ahead-of-the-horse-cms-letter-to-sen-ben-nevers-continues-to-leave-jindal-hospital-plan-approval-up-in-air/.  This will likely be resolved after Jindal leaves office and can just be added to the huge mess the state will need to clean up when he departs.  The legislature is derelict in counting on these up front lease payments for at least two reasons: First, if they are legitimate, they are still borrowing from future years, and second, there is a good chance that they are not legitimate and will not be allowed by CMS.

A key question is, “Are these fair market value leases?”  The state and the complicit private hospital want the lease amounts to be as high as possible – this is how they will maximize the fund shift from private hospital to the state; then the funds will be used to generate the maximum amount of federal match which will be paid back to the hospital.  The state did not engage in a competitive bid process to determine the value of the leased facilities.  Instead, the state identified existing in-state private hospitals that it could pay additional funds through the Medicaid program to make the funding scheme work.  After receiving large up-front extra Medicaid payments, these hospitals would agree to lease the LSU hospitals and the lease payments would be used (recycled?) as match to replace the state funds the governor cut out.  The annual lease amounts are presumably based on an appraised value of the property being leased, but the actual payments which include large up-front amounts and multiples of the annual lease amounts – have nothing to do with the value of the property and everything to do with the state’s budget holes.  Furthermore, it is all but certain that none of the hospitals would garner the large lease amounts without the corresponding agreement by DHH to pay them higher Medicaid payments once they agree to lease the facilities.

Let’s take a closer look at the New Orleans deal.

The LSU Interim Hospital will be leased by Louisiana Children’s Medical Center (LCMC), a health system that includes Children’s Hospital and Touro Infirmary.  In addition to the annual lease LCMC agreed to pay $110 million in an “up front” lease payment to be repaid by the state over the next 20 years.  LCMC is in essence loaning the state $110 million for its use in the Medicaid program.  In addition, LCMC agreed to pay an additional $143 million to the state in order to build the parking garage and clinic office building at the new hospital in New Orleans.

  • $110 million payment.  This amount is notably similar to the state fund shortfall that the governor imposed on LSU shortly after the 2013 legislative session.  Remember the meeting of LSU leadership, board members, and Alan Levine that Fred Cerise documented in the recently circulated memo https://louisianavoice.com/2013/08/21/cerise-townsend-firing-came-soon-after-fateful-2012-levine-meeting-with-lsu-officials-to-discuss-lsumc-privatization/)? The supposed purpose was to identify a way to deal with the massive budget cut that the governor was laying at LSU’s feet.  Cerise outlined the magnitude of the cut which was equivalent to $122 million in state funds and a total – including federal funds -of $329 million and the impact would result in the closure of over half of the LSU hospitals.  Those cuts were never made, yet the governor never explained how the funds were restored to LSU’s budget.  In the New Orleans CEA, LCMC agreed to make an upfront lease payment of $110 million to LSU on or before June 24, 2013.  So with one week left in the fiscal year, LCMC paid LSU $110 million to avoid the massive budget cuts that were assigned to LSU by the governor to prompt the wholesale privatization.  But the cuts were never made, savings never achieved.  Instead, the administration borrowed the money from a private partner.  These funds will be repaid to LCMC over the next 20 years.  The state “borrowed” from LCMC, a private entity, funds to be used as match in the Medicaid program  – a practice that is at the very least against the intent of the federal Medicaid regulations and which the state will be repaying for many years after Jindal is gone from office.  If CMS does not approve of this trick, the state will be repaying the federal funds too (which is a much larger amount).
  • $143 million payment for parking and clinic buildings.  When LSU finally gained legislative approval of its business plan for the new hospital in New Orleans at the JLCB on September 16, 2011, there was a gap of $130 million in funding needed to complete the project (it appears that has grown to $143 million).  LSU explained at the time that it intended to use an LSU- affiliated foundation to provide that funding.  The approval to enter into a contract for construction was based on that assumption which was included in the business plan the JLCB considered.

The motion by Senator Murray (stated at 1:08 on the video archive of September 16, 2011 by Rep. Leger) was to “authorize the Office of Facility Planning and Control to enter into contracts up to the amount of funding in place for construction and completion of UMC in New Orleans.”

LSU received a commitment from the LSU Health Sciences Center – New Orleans Foundation as stated in this excerpt from a letter from LSU President John Lombardi to Thomas Rish, the senior manager for the Division of Administration.

“The mechanism for accomplishing such financing involves the UMCMC  [University Medical Center Management Corporation] Board entering into an agreement with LSU for LSU to provide services to the UMCMC Board, as represented by that board to the Joint Legislative Committee on the Budget on September 16, 2011, and in accordance with the business plan presented in open committee hearing at that time.  In carrying out that business plan and the above-described construction, it is expected and necessary for the UMCMC Board at the appropriate time to enter into one or more agreements with one or more other affiliated entities of LSU so that the affiliated entity will have a sufficient revenue stream to support the financing of the Ambulatory Care Building and the Parking Structure.  LSU has engaged in such financing methods in the past with great success, without affecting the state tax supported debt limit or relying upon the full faith and credit of the state.”

However, the UMCMC Board subsequently refused to commit to an agreement that acknowledged its support for LSU because a plan was already underway to reconfigure the governance structure into a private entity unencumbered with the commitments to LSU, commitments that LSU and UMCMC used in gaining approval for acquisition of private property and construction.  As a result, the LSU Foundation could not obtain this funding.

The Division of Administration proceeded to enter into a contract for construction of the entire project anyway (without the funding in place) in violation of the JLCB motion that authorized contracting for up to an amount of funding in place.  As construction proceeded and desperate for a funder so it could meet its obligations to the contractor, the Administration turned to LCMC for the funds which they agreed to provide on or before June 24, 2013.

Why would LCMC, in addition to an annual rent payment for the hospital agree to pay an additional $253 million up front to the state?  Likely because the state gave them the money first.  On June 18, 2013, DHH made a series of supplemental Medicaid payments to Children’s Hospital and Touro Infirmary in the amount of $250 million.  DHH made Medicaid payments (which include federal money) to LCMC affiliates so that LCMC could return those funds to the state to use as match for more federal funds.  You have to appreciate this scheme from a governor who doesn’t like federal money.

Annual lease payments.

In addition to the $253 million up-front payments, Children’s will make its first annual lease payment this year.   But that won’t be enough money to fill the budget hole for the 2014 budget year.  Remember, any lease payment Children’s makes is to be multiplied with federal match dollars and repaid to Children’s so they have every incentive to pay as much “lease” as possible.  Given federal prohibition on “provider donations” these lease payments must be restricted to fair market value amounts.  In order to address the state budget shortfall, the state will borrow from future year lease payments and have Children’s make a “double” lease payment this year (in addition to the $110 million “up front” lease payment to be repaid over the next 20 years).  The Times Picayune reported this plan by Commissioner Nichols’s to have Children’s make a “double lease payment” of $68 million to plug the current year’s budget hole by encumbering future administrations and legislatures with a payback of state funds and potentially the federal match as well.  http://www.nola.com/politics/index.ssf/2013/09/new_orleans_shreveport_hospita.html

The state will use this $68 million to draw down additional federal funds ($107 million in federal funds based on most recent match rate for Louisiana) and pay the entire amount back to Children’s or an affiliate of Children’s for Medicaid services.  Who wouldn’t put up a double payment?  Why not triple payment?  Quadruple?  Only CMS can put the brakes on this scheme.  They have been through this type of thing before in Louisiana and so will be closely scrutinizing the entire arrangement.  Jindal is calculating that any recoupment of funds will come well after he has destroyed the public hospital system and celebrated his success.  He seems to believe he can violate the CMS provider donation provisions by simply calling the donations “lease payments.”  We’ll see if CMS agrees.

Let’s review:

  1. The state is building a replacement hospital for Charity Hospital in New Orleans using $474 million in federal funds from FEMA and $300 million in other hurricane recovery funds.
  2. The state agreed to lease this facility built with federal funds to a private entity that is a Medicaid provider.
  3. Those lease dollars will be used annually as match in the Medicaid program to draw additional federal dollars.  “Monetizing” an asset built with federal funds, the state will generate additional federal funds as match dollars to support the operation. This will allow the Division of Administration to renege in its commitment of state funds to LSU (which the legislature accepted in the business plan submitted to JLCB as a condition for approval of construction).
  4. In addition, the state made a $250 million Medicaid payment to the private provider on June 18, 2013.  This Medicaid payment included roughly 2/3 federal funds.
  5. The private provider then made a $253 million payment back to the state on June 24, 2013.
    1. $110 million of that payment was directly or indirectly used as match in the Medicaid program to draw more federal money by which LSU was able to meet its budget for 2013.
    2. $143 million of that payment is targeted to complete construction of the new hospital in New Orleans (and qualify as all future rent payments for LCMC) that will be operated as a private facility.

That’s a lot of recycling federal dollars and private handouts, even for Louisiana.  Surely the governor must be proud of this innovation in financing.  Why is he not clearly explaining it to the public?

Read Full Post »

Notable Quotables (in their own words)

Posted in Courts, Higher Education, LSU, Notable Quotables, Public Records on August 30, 2013| 4 Comments »

“That’s not a comment by the Supreme Court one way or another concerning who’s right or wrong on the lawsuit. That’s simply the court saying we’re not going to hear the case now.”

—Attorney Jimmy Faircloth, who is beginning to challenge boxer Peter Buckley’s stellar record of 32 wins against 256 losses, commenting on the Louisiana Supreme Court’s denial of state writs which upholds lower court orders that the LSU Board of Stuporvisors must relinquish the list of semifinalists and finalists for the LSU presidency.

“The Supreme Court said ‘Writ denied. Stay denied.’ As a result, records will have to be produced. As long as the board doesn’t produce those records, it is in contempt.”

—Attorney Lori Mince, who represented the Baton Rouge Advocate and the New Orleans Times-Picayune in the litigation to force the release of the records.

Read Full Post »

LSU releases LSUMC-BRF CEA: terms leave State on financial hook, claims immunity from legal challenges

Posted in Boards, Contract, Contracts, Governor's Office, Health Care, Higher Education, LSU, Privatization, Public Records, Transparency on August 16, 2013| 18 Comments »

Those blank pages in the LSU Medical Center/E.A. Conway Medical Center contract for the takeover of the two facilities by a Shreveport research foundation have finally been filled in but questions nevertheless remain as to the validity of the document.

The one thing it does do with near certainty is to guarantee lots of legal work for attorneys down the road when the disagreements begin—as they almost assuredly will because of both the wording and issues over whether there even is a contract.

It also would appear to transfer both hospitals’ accounts receivable—potentially tens of millions of dollars—to BRF, as the agreement stipulates that LSU shall transfer “all assets” to lessee.

The contract, officially entitled Cooperative Endeavor Agreement (CEA) by and among Biomedical Research Foundation of Northwest Louisiana (BRF), BRF Hospital Holdings (BRFHH), Board of Supervisors of Louisiana State university, the State of Louisiana through the Division of Administration (DOA) and the Louisiana Department of Health and Hospitals (DHH), was provided to LouisianaVoice by LSU on Friday (Aug. 16) pursuant to LouisianaVoice’s public records request earlier in the week.

A companion document, the Master Hospital Lease Agreement, provided along with the CEA, calls for the lessee, BRFHH, to pay the state $38,763,891.38 per year in 12 monthly payments of just more than $3.23 million.

One caveat of the contract which would appear to leave the state on the hook financially is the provision that in the event the state’s required Medicaid per diem payments should appear to be inadequately funded, DHH “shall immediately notify BRFHH” and both the Commissioner of Administration and DHH would be required to seek additional appropriations from the Legislature.

There is no such provision for increased state Medicaid payments to any other medical facility in Louisiana and in fact, many hospitals across the state are in the midst of wholesale layoffs of medical personnel because of Medicaid cutbacks by the Jindal administration. Such cutbacks are placing a heavy strain on already overworked nurses, technicians and other medical employees and many doctors are refusing to accept new Medicaid patients as a result of the state cutbacks.

But even more questionable is the legality of the CEA itself.

The LSU Board of Supervisors on May 28 approved the private takeover of four LSU hospitals—LSU Medical Center (LSUMC) in Shreveport, E.A. Conway Medical Center in Monroe, W.O. Moss Medical Center in Lake Charles and Leonard J. Chabert Medical Center in Houma.

The only problem with that approval was the board approved contracts for each of the four hospitals which contained nearly 50 blank pages, omitting financial terms, the length of the leases involved and a termination clause.

All contracts, to have any legal standing whatsoever, must plainly state an offer and an acceptance (financial terms), dates (length of leases in this case) and a termination clause. None of those were contained in the approved documents.

Even more questionable, it would seem, is a stipulation under “Representations and Warranties of the State,” which says in part:

  • This agreement and any and all agreements, documents or instruments to which the State, through DOA and DHH, is a party and which are executed and delivered by the State pursuant to this agreement constitute the legal, valid and binding obligations of the State, through DOA and DHH, enforceable against the state in accordance with its terms.
  • DOA and DHH have the absolute and unrestricted right, power and authority to execute and deliver this agreement and such other agreement, documents or instruments to which it is a party on behalf of the State and to perform obligations on behalf of the state under this agreement and such other agreements (and) documents.
  • Neither the execution and delivery of this agreement nor the consummation or performance of any of the contemplated transactions hereby will, directly or indirectly, with or without notice or lapse of time…give any governmental body or other person the right to validly challenge any of the contemplated transactions, or to exercise any remedy or obtain any relief under any legal requirement to which the State, DHH or DOA may be subject.

In other words, the contract claims that no governmental entity or individual has any legal rights insofar as mounting any challenge to the agreement by lawsuit or otherwise.

That would appear to be a particularly difficult stipulation to enforce given the fact that the contract may well not be a legal document in light of those nearly 50 blank pages.

Another curious section of the contract which addresses Medicare and Medicaid Certification, the CEA says, “With respect to the hospitals, LSU has met and does meet, without material exception, the conditions for the participation in the Medicare and Medicaid programs, and LSU does not have knowledge of any pending or threatened proceeding or investigation under such programs involving the hospitals or any basis for the revocation or limitation on such participation.”

A June 26 letter from the Center for Medicare & Medicaid Services, however, said the state has not submitted the required state plan amendments (SPA) proposing to fund Medicaid payments through the agreements “and CMS cannot offer former determination as to whether the arrangements would conflict with the requirements described in the Social Security Act. Once the state submits the SPAs, CMS will request necessary supporting documentation and explanations from the state to demonstrate compliance with these provisions of the statute and regulations,” the letter said.

As recently as Tuesday of this week (Aug. 13) a CMS spokesman told LouisianaVoice by email there were “no updates at this time.”

The CEA said that LSU and BRFHH would, after the Oct. 1 execution date of the agreement, jointly submit the proper forms to CMS.

But Bill Brooks, associate regional administrator for the CMS Division of Medicaid and Children’s Health Operations in Dallas, said last January that whenever documents are submitted to CMS, the process starts a “90-day clock,” during which time his office may pose additional questions. A new 90-day clock would begin when his office receives satisfactory responses to his requests.

Thusly, so long as the state fails to satisfactorily answer all questions and provide adequate documentation, the 90-day clock could conceivably run indefinitely. And that would be bad because if CMS disapproved an amendment submitted by the state, “there would be no federal dollars provided for the changes proposed” in the agreement.

Another provision in the agreement says that the Department of Corrections (DOC) is responsible for paying BRFHH for medical care provided state prisoners should DOC suspend payments for any reason, the state would have to find “alternative sources of medically necessary health care” for prisoners.

Though the agreement requires that all LSU Hospital employees shall be offered employment by BRFHH, the agreement says they “shall be employed subject to terms and conditions established by BRFHH”—meaning potentially lower wages and fewer benefits. At the same time the agreement also holds LSU liable for state employee expenses such as unemployment benefits, wages and benefits for “past, present and future employees of LSU.”

One other clause, this one contained in the lease agreement, warrants particular attention because of the failure to enforce an identical clause in another state agency privatization contract in 2010:

“Lessee (BRFHH) shall not assign this lease or any interest therein without the prior written consent of lessor” and “may not sublease all or any portion of the leased premises without the prior written consent of lessor.”

In 2010, the state contracted with F.A. Richard and Associates (FARA) to take over operations of the Louisiana Office of Risk Management (ORM) at a cost to the state of just over $68 million. Less than eight months later, ORM and DOA agreed to a 10 percent amendment to that contract, bumping the state’s cost to $75 million. Within weeks, FARA sold its interests to an Ohio company which in turn sold out to a New York firm—all within the first year of the contract.

A similar “prior written approval” clause was contained in the contract with FARA but when LouisianaVoice made a public records request for the written approval, DOA responded that no such document existed.

That, naturally, would raise the question of whether or not DOA would enforce that stipulation in this contract or not.

The lease agreement does give BRF the authority to lease to a “non-profit corporation, a limited liability company, limited liability partnership or other non-profit legal entity wholly owned or controlled by lessee or Biomedical Research Foundation of Northwest Louisiana.” That, of course, would be BRFHH, a non-profit entity “wholly owned” by BRF.

Finally, a clause in the CEA which might otherwise be overlooked, takes on significant importance in that “financial and other records created by, for or otherwise belonging to BRF or BRFHH shall remain in the possession, custody and control of BRF and BRFHH, respectively,” and such records would be considered “proprietary to BRF and BRFHH” and “such records shall be clearly marked as confidential and/or proprietary,” and thus protected from the Louisiana public records laws.

This could be crucial inasmuch as questions have arisen as to the financial viability of BRF, a non-profit organization that depends heavily on grant money, much of it from the state, for its operations. BRF has no experience in operating a facility like the two medical centers it is being contracted to run and skeptics feel it also does not have the financial resources to be successful in that endeavor.

Adding to the aura of mystique is the reported sighting of former DHH Secretary Bruce Greenstein having lunch in a Shreveport restaurant with BRF Board Chairman Stephen Skrivanos recently. BRF CEO/President Dr. John George was also reported to have been in that meeting but he has publicly denied he was present and has threatened Shreveport political consultant Elliott Stonecipher with a libel lawsuit over the reports of his attendance.

George, in addition to being the CEO and President of BRF, is also a member of the LSU Board of Supervisors which approved the agreement with BRF but Jindal has claimed there was no conflict of interests in George’s serving in the two capacities.

What makes all this so intriguing is that Greenstein resigned in the wake of an ongoing federal investigation into a $187 million DHH contract with CNSI, his former employer. Greenstein assured legislators at his confirmation hearings in 2012 that he had erected a “firewall” between him and CNSI to ensure there would be no contact with his old company during the contractor selection process. Emails and phone records subpoenaed by the committee, however, revealed Greenstein was in constant contact with CNSI officials throughout the selection process.

Even though he quickly announced his “resignation” following news of the FBI probe, he was allowed to remain on the job a month before vacating his office. He subsequently moved back to Seattle but recently showed up in Shreveport with Skrivanos.

Adding fuel to the fires of speculation was the appearance at the State Capitol a few months ago by Alan Levine, Greenstein’s predecessor at DHH.

With the blank contract, questionable financial abilities of BRF (in some minds), the mysterious appearances of Greenstein and Levine, the defensive reaction of George to the report of meeting with Greenstein even to the point of a threatened lawsuit, and potential conflict of interest of George serving as head of BRF which was approved to take over two major hospitals by an LSU board on which he sits, there is plenty of room for speculation and conspiracy theories.

Had the federal investigation into the CNSI contract not surfaced, who knows what direction this plot may have taken?

That’s especially true given the lack of transparency and openess in this administration.

Read Full Post »

No funds for deteriorating classrooms or for disadvantaged, but $1.2 million found for Mannings’ football camp at NSU

Posted in Budget, Governor's Office, Higher Education, House, Senate, Legislature, Legislators, Politicians on July 26, 2013| 16 Comments »

The Louisiana Board of Regents in May estimated there was a $1.7 billion backlog in repairing and renovating campus facilities in colleges and universities across the state.

But even with sewer systems that backed up into classrooms, leaky roofs, outdated laboratories and even mold among the deficiencies cited by the Regents, it’s certainly good to know that Gov. Jindal and the Louisiana Legislature could scrape together $1.2 million to make improvements to athletic facilities at Nicholls State University in Thibodaux in order to make life easier for the Manning family.

Don’t get us wrong. We have nothing against the Mannings. We were not among those who got up in arms when Peyton and Eli opted to ply their trade for the University of Tennessee and Ole Miss, respectively. In fact, Eli’s gravitation to Oxford was just natural, given that Dad Archie played there. But didn’t our Bert Jones embarrass Archie and the Rebels 61-17 back in 1970? And two years later, Jones somehow managed to get off two passes in the final four seconds, the second one to Brad Davis for a 10-yard touchdown and a 17-16 win (We know, set your watches back two seconds…).

No, this is not about Archie, Eli, Peyton and Cooper and their football camp at Nicholls.

This is about priorities.

Jindal somehow can’t find money to help the developmentally disabled in this state but he can find $1.2 million (with the assistance of State Sen. Norby Chabert, R-Houma, and State Rep. Lenar Whitney, R-Houma), to make improvements to the 25 football fields on which the Manning Passing Academy teaches some 1200 football campers—campers who, we are reasonably certain, pay a hefty fee for the privilege of receiving tutelage from the quarterbacking legends.

Pardon us for not fawning all over the Mannings and praising Jindal’s efforts to keep the passing camp at Nicholls (even though Archie Manning said he had no intentions of moving the camp). So what if they were to move the camp? Where would they take it? In all likelihood, they’d simply go to another Louisiana city.

“The improvements are good for the academy (no kidding?) but it is good for Nicholls (which classroom or professor benefits from this?) and I want to thank the folks here and the people at the South Louisiana Economic Council for working to get this done,” Jindal said, apparently forgetting for the moment the pressing need for better classroom facilities at institutions of higher education all over the state.

And did it slip his mind that he has slashed the higher education budget by 80 percent since he became governor?

“This academy has a $1.8 million impact to our state,” the governor said.

Wait. What? Did anyone at that staged announcement in the John L. Guidry Stadium’s Century Club Room on July 12 have the presence of mind to challenge that statement? Did anyone asked the governor to quantify those numbers?

If not, we will. Right here. Right now.

How does Jindal and/or the South Louisiana Economic Council calculate the economic impact of this event? Campers who stay overnight pay the Mannings, not local hotels or eateries. We love the way in which political leaders, for the sake of political expedience, pluck such numbers out of thin air.

The biggest economic impact, we would guess, would be the fees charged by the Mannings for their “academy.” And that money goes into their bank accounts, not the Lafourche Parish economy. Does anyone seriously believe the Mannings stage their annual academy for free?

Based on the academy’s fee schedule (see comments by GJD), the Mannings take in something between $500,000 and $700,000 for the four-day camp.

We let our civic proud show through when Peyton won his one Super Bowl and Eli his two. Okay, we were also thrilled when Peyton lost that one special Super Bowl to the Saints. And we were a little smug when he had that great comeback season for Denver last year. But to take funding away from needed projects and lavish it on these millionaires who are promoting…football? A game?

“They don’t have to spend their summers here,” Jindal said of Daddy Archie and sons. “They don’t have to rearrange their schedules to be here. They choose to do that.”

Wow. Talk about gooneybabble. Talk about mindless spin. Talk about convoluted logic.

Spend their summers here? Try four days. Rearrange their schedules? What the hell is Jindal talking about? They specifically arrange their schedules around this annual event to rake in a small fortune—far more than the average state employee earns in a year—even more than some of Jindal’s non-classified appointive positions (readers’ collective gasps would go here). You’re damn right they choose to do that, Governor. Anyone in his right mind would choose to do that for the money they get.

Come to think of it, though, they probably spend more days at their passing academy each year than you do in Louisiana, Governor.

It’s one thing to turn your back on those in need in order to help your wealthy friends, Guv, but don’t blow smoke up our togas while you’re doing it.

Read Full Post »

Notable Quotables (in their own words)

Posted in Boards, Governor's Office, Higher Education, Notable Quotables on June 20, 2013| 3 Comments »

“Regarding these six men, there has been only one change from the report filed on June 15, 1992. The change is that Mr. Carl Shetler was appointed to the Board of Trustees for Colleges and Universities for the State of Louisiana for a period of six years, effective Jan. 1, 1993.”

—Letter from McNeese State University Athletic Director Robert Hayes to Greg Sankey of the Southland Conference dated June 29—barely two weeks after Hayes identified six Lake Charles area businessmen, including Shetler, who were to be disassociated with the university for illegal financial payments to McNeese athletes.

Read Full Post »

« Newer Posts - Older Posts »