LaPolitics by Maginnis: Legislators feel financial stress; health-care overspending seen as culprit

LaPolitics by Maginnis: Legislators feel financial stress; health-care overspending seen as culprit




Adding to early-session stress over controversial education and retirement bills are fears that the Legislature could face another big shortfall in revenue projections, causing further deep cuts in the budget. Senate sources say the pace of tax collections could cause up to a $175 million drop in anticipated funds by the time the Revenue Estimating Conference meets in May. The current budget is based on an anticipated $350 million revenue growth. But collections in the core categories—sales, personal income, corporate income—are flat, and the anticipated growth may not be fully realized. Much depends on corporate income tax returns, but those collections have swung widely in past years and that category is the most difficult to predict. Gov. Bobby Jindal's press secretary, Frank Collins, gave this statement, "As always, we're going to have a balanced budget that doesn't raise taxes and protects critical services."
—For a major cause of the pending budget crisis, the House Appropriations Committee homed in on a $678 million increase in the Department of Health and Hospitals budget. Over half of that increase, $379 million, came from higher-than-projected Medicaid utilization of private providers. This includes more people with behavioral problems seeking care in hospital emergency rooms following the state's closure of beds in mental health facilities from midyear budget cuts. Committee Chairman Jim Fannin, D-Jonesboro, pressed DHH Secretary Bruce Greenstein on how he plans to make ends meet in the future. "I don't see the growth in spending keeping up with the growth you have in the budget," he said. A later statement from Greenstein reads, "The [budget] increase is misleading in that it does not reflect the significant cost reduction strategies and savings that are part of DHH's budget strategy." He adds that while national Medicaid expenses have grown by 40% in the last six years, Louisiana has held that growth to 30%.



They said it: "It's not even Russian roulette, because there are no empty chambers." —Rep. John Schroder, R-Covington, on the DHH budget

(John Maginnis publishes LaPolitics Weekly, a newsletter on Louisiana politics, at LaPolitics.com.)



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