Louisiana Voice

True to form, Gov. Piyush Jindal waited until a Friday, considered one of the slower news days of the week, to make the long-anticipated announcement that Blue Cross/Blue Shield (BCBS) had been selected to administer the Preferred Provider Organization (PPO) for the Office of Group Benefits, a move that will eliminate 177 positions in the office.

Jindal was considerate enough to release the announcement through his favorite publication, the Baton Rouge Business Report, which ran the story on its web page. The OGB web page also carried the announcement.

The administration likewise waited until Friday to make the announcement that the 348-bed Southeast Louisiana Hospital in Mandeville will begin closing down operations, effective, Oct. 1, costing another 300 employees their jobs.

St. Tammany Parish has the highest suicide rate in the state and the move leaves up to a quarter-million people with no facility for treatment of depression or suicide prevention.

The move with Southeast Louisiana Hospital came as a major surprise considering some of Jindal’s strongest support has historically come from legislators in St. Tammany.

Both events might be considered as part of what Capitol Bureau reporter Marsha Shuler described in Friday’s Baton Rouge Advocate as Jindal’s health care “train wreck.”

The administration on Friday sent separate letters to BCBS, Humana and United Healthcare. The letters to Humana and United Healthcare informed them that their proposals were not accepted while the one to BCBS announced it had won the contract to be OGB’s third party administrator (TPA) for both the state’s HBO and PPO, which the administration said will save the state $20 million per year.

BCBS has already been serving as the TPA for the HMO and effective Jan. 1, will be assuming administration of both.

The privatization of OGB’s PPO has been controversial since first being proposed by Jindal more than a year ago. The root of that controversy lies in the fact that the OGB employees paid claims with a turnaround time of less than three days, much to the satisfaction of the 62,000 state employees, retirees and their dependents.

Moreover, the PPO had gone from a $60 million deficit to a $500 million surplus in the five years during which it was run by former director Tommy Teague. Teague was fired on April 15, 2011, when he didn’t sign on to the privatization plan quickly enough to please Jindal.

His successor, Scott Kipper, lasted only six weeks after testifying before a legislative committee that were it left up to him to decide, he would not lay off any of the OGB employees. That remark, made in response to a direct question from a committee member, appeared to irritate his boss, Commissioner of Administration Paul Rainwater who, only moments before, had indicated a need to downsize the agency by 149 positions.

The quick turnaround of claim payments combined with the agency’s $500 million surplus seems to be in stark contrast to Rainwater’s statement on Friday: “The selection of a third-party administrator is an important step toward providing quality care and service to plan members in the most cost-effective way.”

Former State Sen. D.A. “Butch” Gautreaux (D-Morgan City), who served as chairman of the Senate Retirement Committee and as a member of the OGB board of directors before being term-limited last year, fought the governor’s privatization efforts every step of the way.

Contacted Friday, Gautreaux was typically critical of the move. “Sometimes it just isn’t satisfying to be right,” he said.

“It was told to me confidentially well over a year ago and re-stated by in a Senate Retirement Committee hearing that the PPO was going to Blue Cross/Blue Shield.

“I hope Bobby Jindal leaves soon but I feel sorry for his successor. The cost of employee and retiree health insurance will be rising once we get over the one-year hump.” He was referring to a one-year moratorium on premium increases promised by the administration. Gautreaux said the information about premium increases was shared with him by the same source.

Because the state paid no taxes on premium income and because there is no requirement for a profit as long as the PPO was administered by the state, skeptics fear the need for profit and the requirement to pay taxes on profits will necessitate a rate hike by a TPA.

“It really is a shame that we, the taxpayers of Louisiana, will have to face the real cost of Bobby’s ambition for a very long time,” he said.

St. Tammany has had 124 suicides since 2009 and many more reported attempted suicides during that same period.

“The department (Department of Health and Hospitals) is very aware and concerned about the suicide rate,” said DHH press secretary and director of the Bureau of Media and Communications. “Our commitment and ability to respond to patients who will need beds and treatment remains the same,” he said.

State Sen. Jack Donahue (R-Mandeville) said the announcement caught him off guard. “It was not discussed during this legislative session to my knowledge. I was told 15 minutes before the announcement was made.

Rep. Scott Simon (R-Abita Springs), chairman of the House Committee on Health and Welfare, was equally unaware and expressed his “shock” that Jindal would take such action.

To abruptly close down one of the largest employers in St. Tammany in a parish where Jindal has enjoyed some of this strongest support is bad enough. But to do so without even extending the courtesy of giving his legislative allies a heads-up to prepare them only compounds his insensitivity and boorish contempt for the citizens of St. Tammany in particular and citizens of the state in general.

While Jindal and GOP presumed presidential nominee have been accusing Pres. Barrack Obama of being “out of touch,” Shuler was quick to point out the governor’s own inconsistencies and what might appear to some as his deliberate moves to dismantle the state charity hospital system.

The Advocate reporter said Jindal, who is rarely in the state anymore, choosing instead to stump for Romney while auditioning for the vice presidential nomination, seems almost aloof to the financial straits Louisiana’s Medicaid health care program suddenly finds itself in.

A new federal law gutted more than $859 million from the state’s Medicaid funding but Jindal, Rainwater and DHH Secretary Bruce Greenstein say the state can overcome the cut by sacrificing services offered by the LSU hospital system’s care for the uninsured and physician training programs. Further cuts would come through reducing payments for uninsured care by rural hospitals.

As recently as late May, Greenstein and Jindal were united in predicting a doomsday scenario if a proposed $51 million cut was imposed on the LSU Med School. They predicted that some of LSU’s 10 public hospitals, which provide healthcare to the state’s indigent and which also train physicians, might have to shut down.

Now, however, since Jindal has rebuked Obama’s health care plan, the $859.2 million cut to the state’s Medicaid program is “doable,” they say, again in unison. Greenstein even called the cuts “an opportunity to reform and modernize.”

Greenstein and Rainwater, who foresaw widespread closures with a $51 million proposed cut, now say LSU can cut $300 million and still maintain health care for the poor and uninsured.

Now who’s out of touch?