FILE - Sen. Sharon Hewitt

Louisiana state Sen. Sharon Hewitt, R-Slidell (Teejvalley | Wikimedia via Creative Commons)

The Louisiana Department of Health (LDH) will mail notices this week to 37,000 people – including 17,000 nursing home residents – alerting them that proposed state budget cuts could terminate their Medicaid eligibility after July 1.

But none of those letters will be mailed to the 471,000 state residents who have enrolled in Medicaid since Louisiana expanded eligibility guidelines to 138 percent of the federal poverty level in September 2016.

Also not specifically identified on LDH’s mailing list will be 860,000 of the state’s 1.7 million Medicaid recipients who a legislative auditor’s office review determined had $10,000 discrepancies between information on their tax returns and Medicaid applications – including the 83,000 with income variations of $20,000 or more.

This did not sit well with members of the Senate Finance Committee after enduring seven-and-a-half hours of public testimony from desperate people begging them to restore funding to the state’s proposed fiscal year 2019 budget to maintain critical, often life-sustaining services for themselves, their children, parents and clients.

“The letter that ought to be going out should be to the enrollees that we question their eligibility,” said Sen. Sharon Hewitt, R-Slidell. “I think that would be a better use of time and a little more responsible than kicking grandma out of the nursing home.”

Hewitt said the legislative auditor’s office estimates the state could save about $480 million in removing ineligible people from Medicaid’s rolls. That would, essentially, restore the $431 million in LDH cuts in the proposed budget, which would mean an additional $1.6 billion or more in federal matching dollars.

If a mere 5 percent were ineligible, it would amount to $192 million, Hewitt said.

“That is where the department’s efforts should have been since November instead of sending out letters to all these others folks who are disabled and elderly,” she said.

The Senate Finance Committee got its first crack Monday at House Bill 1, the state’s preliminary $8.947 billion FY19 general fund budget the House passed in a 55-47 vote – two above the 53 necessary for adoption – on April 19.

The proposed budget includes a $648 million shortfall from this year’s $9.595 billion spending plan with the lion’s share of that gap in LDH’s budget.

The administration of Gov. John Bel Edwards claims the cuts threaten the viability of the state’s 11 public-private partnership hospitals, Louisiana State University’s medical school residency programs and says they could eliminate health care services for 46,000 people – including 31,798 elderly and disabled now in nursing homes or receiving in-home services.

Nearly all those who appeared before the committee Monday testified about health care cuts. Many asked lawmakers not to pass the proposed budget but, instead, go into a special session to plug gaps by raising revenues.

Legislative leaders and Edwards have tentatively agreed to do just that. The most likely scenario is adjourning from the regular session, scheduled to end June 4, on May 18 and convening the special session on May 21.

Sen. Regina Ashford Barrow, D-Bossier City, said the Legislature won’t need to raise taxes or extend expiring sales taxes to restore much of the budget but can do so by reducing tax exclusions, credits and rebates for corporations and businesses.

“If everybody took their fair share, we could address these issues,” she said. “They, too, need to pay their fair share.”

Louisiana Nursing Home Association Executive Director Mark Berger said, when including the loss of federal matching Medicaid funds, the budget cuts nearly $1 billion for nursing homes.

The proposed budget reduces Medicaid eligibility for those who need long-term nursing home care from $2,250 a month to $750 a month.

Senators questioned the need for LDH to issue the notices now rather than waiting until it is certain cuts will be imposed.

“I don’t see how, in good conscience, they can do that,” said Sen. Mack White, R-Baton Rouge, noting LDH has the cash flow and reserves to operate for 10 months without increased funding. “They have money in their budget, should they choose to plug the holes.”

Maybe, Berger said, but the notifications are “not about the money, it’s about eligibility.”

Berger said affected recipients must be alerted their eligibility status may change within 30 days of termination as part of a “involuntary discharge process.” The letters are going out May 10 to provide time to appeal determinations and make alternative arrangements.

Berger warned the process won’t go smoothly because nursing homes must, by federal law, “provide a safe and orderly transfer” of patients to ensure they continue to be cared for.

The only way around the stipulation is for nursing homes to close, Berger said.

“That is the business side of the scenario,” he said. “The human side is thousands of residents and their families will go through grief and stress.”