Louisiana Voice

If you think Gov. Bobby Jindal’s veto of $4 million to provide in-home services to the developmentally disabled was merely an aberration, an inadvertent blip on the budgetary radar, you may wish to reassess your decision to give the governor a pass on this issue.

Jindal, of course, offered his own spin in his pushback against criticism he has received from proponents of the measure but he simply can’t get around the fact that cutbacks of services to the poor appear to be the norm in several states these days. Surely he has not forgotten his closure of Southeast Louisiana Hospital in Mandeville less than a year ago that put mental health treatment by state facilities out of reach for many in southeast Louisiana.

No one denies the current budgetary shortfalls—brought about in large part by Jindal’s stubborn refusal to seek new means of tax revenue except through the New Orleans hotel fee increase (which is not a “tax,” in the land of Jindal-speak, but an “enforceable obligation,”) and college tuition increases (“fees,” not taxes). But were it not for the more-than-generous tax incentives doled out in the form of corporate welfare, er, industrial incentives the state’s coffers would be $5 billion richer each year.

It’s not like he couldn’t have trimmed a couple of million or so from the $1.285 billion appropriation for his Office of Homeland Security and Emergency Preparedness. Of course, to suggest there might be the remote possibility of waste in a budget of nearly $1.3 billion for a pet agency would be blasphemy.

The Louisiana State Racing Commission got its full share of funding—$12.2 million. Surely, there’s no waste there. Likewise, the $82.7 million appropriation for the Louisiana Stadium and Exposition District administered by a commission made up 100 percent of generous Jindal campaign donors.

Then there’s the Department of Economic Development and the Office of Business Development which combine to receive the full complement of their $36.6 million appropriation in order to ensure the uninterrupted flow of those $5 billion in tax incentives, rebates and exemptions to attract all those new jobs that are supposed to retain current residents and bring in new ones—even though the state’s population has shrunk to the extent that we now have only six congressmen instead of the eight we had a few years ago.

And we’re not even going to go into detail about all those washed up ex-legislators hired by the various agencies at six-figure salaries—or the glut of administrative personnel with limited experience with which John White has loaded down his Department of Education, also at six-figure salaries. Or White’s slipshod management of the disastrous voucher program that allowed New Living Word School in Ruston to rip off DOE to the tune of nearly $400,000—money that will never be recovered, by the way.

Sorry, folks, the money’s not there for the developmentally disabled. You just should have had the good sense to be born developmentally abled or better yet, rich.

And as we said in the first paragraph, that veto was no accident. It was planned from the get-go as will future cuts of medical benefits to the poor.

Why do you think Carol Steckel was brought here in the first place?

Steckel was Alabama’s Medicaid Commissioner from 1988-1992 and again from December 2003 until her move to Louisiana in November of 2010.

While at Alabama she issued a ruling that poor amputees in that state didn’t really need artificial limbs. In January of 2008, she submitted the state’s Medicaid budget that cut programs that pay for prosthetics and orthotics (used to provide support and alignment to prevent or correct deformities) because, in her words, the programs were optional, not mandatory.

She also awarded a $3.7 million contract to Affiliated Computer Services (ACS) in 2007 even though that company’s bid was $500,000 more than the next bid. ACS had hired Alabama Gov. Bob Riley’s former chief of staff Toby Roth, which probably greased the skids somewhat.

Sound familiar? ACS, which is now part of Xerox, was awarded four state contracts totaling $45.55 million and ACS contributed $10,000 to Jindal political campaigns. Jan Cassidy, sister-in-law to Congressman (U.S. Senator wannabe) Bill Cassidy, previously worked for ACS and then for Xerox as Vice President, State of Louisiana Client Executive. Where is Ms. Cassidy today? She heads the State of Louisiana Division of Administration’s Procurement and Technology Section at a salary of $150,000. Toby Roth in reverse?

Steckel was imported from Alabama and given the title of Chief of the Department of Health and Hospital’s (DHH) Center for Health Care Innovation and Technology. She created quite a stir when she failed at first but eventually succeeded at terminating 69 information technology positions at DHH and giving the contract to the University of New Orleans to run. The 69 employees moved over to UNO’s payroll, saving the state zero, and UNO began collecting an administrative fee of 15 percent to run the IT operations for DHH. Thus, instead of a savings, the state is now paying an additional 15 percent for privatization.

Steckel has moved on again, this time to work her magic as Medicaid Director for North Carolina.

Now let’s move about 400 miles to the west—to Austin—and examine what occurred when similar legislation was passed in Texas a decade ago.

Dave Mann (not to be confused with the premier political analyst of our era, Bob Mann), then a reporter for the Texas Observer, covered the story in June of 2003 and predicted a train wreck would result from the legislation pushed through by Republican Rep. Arlene Wohlgemuth. Mann, it turns out, was dead-on in his predictions, which could explain in part why he is that publication’s editor today.

HB 2292 amounted to a “massive rewrite of the state’s social services safety net,” Mann wrote by squeezing 11 existing state agencies into four, all under the control of a powerful governor-appointed commissioner. It also cut many relatively inexpensive healthcare services for the poor, wiping out 1,000 state jobs in the process by privatizing several core state functions (again, sound familiar?)

The bill cut services under the Children’s Health Insurance Program and threw up bureaucratic barriers that purged an estimated 160,000 kids from its rolls. It abolished an entire section of Medicaid that offered temporary aid to families who were unable to pay high medical bills because of illness or accident—knocking an additional 10,000 people month out of medical coverage. It also put the squeeze on nursing home patients by reducing their “personal needs” allowances by 25 percent—from $60 per month to $45 (money nursing home residents spent on such things as toothpaste, shampoo, and shoes).

Proponents of the bill crowed that it would eliminate more than 3,000 state employees and hand over several core functions to large corporations, many of whom were major campaign contributors to key Texas politicians.

Among those outsourced functions were four privately run call centers with operators charged with making the determination of which families would be eligible for state programs like Medicaid, CHIP, Supplemental Security Income, welfare and food stamps.

Would anyone care to guess which company tried desperate to jockey itself into position of grabbing a call center contract? None other than our old friend, ACS, which was already running Medicaid programs in 13 states, including Texas.

ACS ended up not getting the call center contract, but if it had, it would have created the mother of conflicts of interest because by virtue of running the Texas Medicaid program, it was charged with keeping administrative costs down. Thus, the fewer Medicaid cases on the books, the lower the costs and the more money ACS would have stood to make. Thus, had it run the call center in the dual role as guardian of the program, it would have had a financial incentive to approve as few people as possible for Medicaid benefits.

Mann, contacted Monday, said though ACS did not get the call center contract, the operation nonetheless “fell apart within months.”

He said the error rates skyrocketed “because experienced state employees who knew the system were gone” and the contractors knew precious little about the system. “The enrollment process was messed up from the start,” he said, and the state was handed a substantial fine by the federal government.

He said Texas had to try and rehire all the former state employees who had been doing the job before. “They had to bring them back in and have them salvage the system,” he said.

Now, if you happen to wonder how four states—Alabama, Louisiana, Texas, and with Carol Steckel now on the scene, most probably North Carolina—could each stumble into the same scenario with Medicaid reforms and privatization of support staff, rest assured it was not a coincidence.

Efforts in Texas, Louisiana and Alabama (and presumably North Carolina) to slash health care benefits under the states’ Medicaid programs come to us courtesy of our old friend, the American Legislative Exchange Council (ALEC).

Though we have not visited ALEC for some time, the organization of some 2000 state legislators and scores of corporate underwriter-sponsors has never been very far from the action.

Among the major targets of ALEC are state health, pharmaceutical and safety net programs, including:

• Opposing health insurance reforms with state constitutional amendments;

• Opposing of efforts to advance public health care;

• Eliminating mandated benefits intended to ensure minimal care for American workers;

• Supporting Medicare privatization;

• Creating barriers to requiring important health benefits;

• Privatizing child support enforcement services.

ALEC’s number-one priority has been to encourage its members (legislators) to introduce bills that would undercut health care reform by prohibiting the Affordable Health Care Act’s insurance mandate.

Led by PhRMA, Johnson & Johnson, Bayer and GlaxoSmithKlein, ALEC’s model bill, the “Freedom of Choice in Health Care Act,” has been introduced in 44 states. Utilizing ideas and information from such groups as the Heritage Foundation, the National Center for Policy Analysis, the Cato Institute, the Goldwater Institute, the James Madison Institute, and the National Federation of Independent Business, ALEC even released a “State Legislators Guild to Repealing ObamaCare” in which a variety of model legislation, including bills to partially privatize Medicaid and SCHIP, is discussed.

Pardon our skepticism, but after the disasters of the Office of Risk Management privatization and the Department of Education voucher fiasco, we can’t help being a bit leery of these quick-fix schemes. The sweetheart CNSI contract with DHH has already proved to be a major $200 million scandal—and that may well be only the beginning.

Up next is an ambitious program to privatize the IT operations of 20 agencies under the Executive Branch. That privatization could mean the loss of some 1100 more state jobs and their duties turned over to a private firm with no grasp of how things are done. That sad scenario has already played out in other states and invariably resulted in cost overruns and repeated failure. There is no reason to expect a better outcome this time.

It was Albert Einstein, after all, who defined insanity as doing the same thing over and over and expecting different results.

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