Louisiana Resubmits Hospital Privatization Plan to Federal Agency


Louisiana Gov. Bobby Jindal’s administration has revised its plan to privatize state-run hospitals with federal dollars and resubmitted it to the agency that just last month rejected the proposal.

The plan involves shifting the management of hospitals now operated by Louisiana State University in New Orleans, Lafayette, Houma, Lake Charles, Shreveport, and Monroe. It would cost the state a reported $1.1 billion this year, and relies heavily on expected funds from the federal government.

The Centers for Medicare and Medicaid Services (CMS) rejected the administration’s plan in May, including its request for reimbursement of the $260.8 million in advance lease payments the state made to support the plan prior to its approval.

Although the administration had said it would move forward with the plan despite the CMS rejection, now it appears that the administration is attempting once again to gain approval for the federal funds.

“We have been in discussions with CMS about this. We are using their guidance and their advice in developing this state plan amendment,” Louisiana Department of Health and Hospitals Secretary Kathy Kliebert told the Associated Press.

According to reports, the new proposal would not change the reimbursements rates to the private hospital managers, which CMS raised objections to when the original plan was rejected. Instead, the new plan would create a completely new category of reimbursement rates for the hospitals being privatized, and remove all references to the privatization contracts.

CMS has 90 days to review the proposal.

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