Barbour files plan to cut Medicaid

Published 10:56 pm Friday, July 11, 2008

JACKSON (AP) — It’s a tried-and-true technique in government: If you’ve got bad news, release it late Friday afternoon and then leave for the weekend.

Moments before the Mississippi secretary of state’s office closed for the weekend, Gov. Haley Barbour filed an 83-page plan to start the process of making cuts in Medicaid, a government health program for the needy.

Then, the governor’s staff was unavailable to explain the cuts in any more detail than Barbour had given during a news conference Thursday in Jackson.

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An Associated Press review of the documents Friday showed that a long list of Medicaid providers will be affected if the cuts take effect, as scheduled, on Aug. 6.

For example:

– Pharmacists will see a 10 percent reduction in payments.

– Nursing homes will see a 6.1 percent reduction.

– Hospitals, physicians, ambulance companies, durable medical equipment companies and others will see a reduction for ‘‘’lower of logic’ Medicare Part B claims’’ — a bureaucratic category that demanded translation. A spokesman for the governor declined to explain details of the plan.

‘‘I sincerely regret having to take this action, but as I have been saying for weeks, it is required by law because the Mississippi House has failed to enact a solution to the current $90 million shortfall in the Medicaid program,’’ Barbour said in a written statement released when the cuts were filed.

Many lawmakers, though, say there’s no requirement in law for Barbour to make the cuts now. They say he could wait until January or later, as has happened the past several years when Medicaid has had larger shortfalls.

In the past, lawmakers have used federal Hurricane Katrina recovery money to patch some budget holes for Medicaid. Some years, they have put more state money into Medicaid by using higher-than-anticipated tax collections when the economy was healthy.

The new state budget year started July 1, and Medicaid is $90 million short of what it needs to get through next June 30.

For every $1 Mississippi spends on Medicaid, the federal government spends more than $3. Barbour said his plan outlines about $375 million in cuts. About one in every four Mississippians is enrolled in the program.

The House and Senate return to the Capitol on Aug. 4 to restart a special session.

Barbour wants lawmakers to pass his plan to restructure hospital taxes to help pay for Medicaid.

The Senate has passed his plan, but House Democratic leaders say they want to consider an increase in cigarette taxes.

House Medicaid Committee Chairman Dirk Dedeaux, D-Perkinston, criticized Barbour for making cuts now rather than allowing lawmakers to do more work on the budget later. He pointed to Barbour’s background as a tobacco lobbyist.

‘‘Gov. Haley Barbour would rather cut $375 million out of Medicaid than see one cent in new taxes on cigarettes to be devoted to the program,’’ Dedeaux said Friday. ‘‘His attempt to tax hospitals instead of cigarettes to pay for Medicaid services is a clear indication of his priorities in health care policy.’’

Barbour has said repeatedly that his record as a lobbyist has nothing to do with his opposition to increasing cigarette taxes. He said a group that he appointed to study the state tax structure will release a report late this summer, and he expects the group to recommend increasing Mississippi’s cigarette excise tax. At 18 cents a pack, it is one of the lowest tobacco taxes in the nation.

Barbour spokesman Pete Smith said Friday that the governor will not appeal a Medicaid ruling handed down Thursday by Chancery Judge William Singletary. The judge said the Division of Medicaid does not have the power to set taxes to pay for the program; only the Legislature has that power.

The ruling was from a lawsuit that dozens of hospitals had filed in 2006 to challenge a hospital tax plan the governor was trying to put in place then. The plan he’s pushing now is different.