04 April 2018

Committee action, Apr. 4: HB 88, HB 462

HB 88 by Rep. Sherman Mack would enhance penalties for those who committed benefits fraud. He told the House Criminal Justice Administration Committee that currently no disincentive applied to falsifying application against individuals, as opposed to laws discouraging provider fraud. The penalty would vary from none to five years, or seven years in special cases.

Rep. Denise Marcelle said the bill was a reversal of criminal sentencing reform because it increased time in jail, although it was pointed out this penalty was discretionary, and claimed it would criminalize poor people who lie, although it was pointed out that those who truly qualified for a program who have no reason to falsify their applications. Rep. Barbara Norton asked what would happen if after applying for benefits someone got a raise or different job for more pay, and was told the law only looked at the representation at the time of application.

Rep. Ted James said tax incentives and rebates ought to be included, even though the bill only addressed entitlements, and offered an amendment to do that. Mack said that served to reduce the potential penalty for fraud in those kinds of activities, so why include it in the bill, and also could cause double jeopardy problems. The amendment was defeated 6-11, with only Democrats present voting for it.

Rep. Joe Marino said he hesitated to support a bill that created a specialty crime, and wondered whether it was similar in scope to other similar crimes, which he was told it was. He also said it might be better graduated, but Mack said the dollar amount didn’t matter, it was the act of misrepresentation. Further, program benefits typically rewarded well over $1,000. Additionally, he fretted the inclusion of disaster relief, and thought a clerical error muddied the waters. He offered an amendment to clear that up, which was accepted.

Rep. Tony Bacala wondered if government salaries and reimbursements should count. Told that a wage differed from a benefit, he said this should be included. Mack said this should end up in a different bill.

Reps. James, Marcelle, and Barbara Carpenter asked one after another why the law was needed if other fraud statutes could address this, so why was it needed and why not include others. Each was told in turn it streamlined the process for addressing this particular behavior and made it easier to prosecute.

Moved for passage, it passed 10-6 with only Democrats present voting against it.

HB 462 by Rep. Polly Thomas would change hospital Medicaid reimbursement rates, which currently vary greatly. She told the House Education and Welfare Committee the bill would change this to the money-follows-the-person philosophy. She said current Medicaid financing arrangements were unsustainable that would threaten the current arrangement used to create better balance, and this change followed what a majority states were doing to cope with this problem. She could not understand why the same diagnosis netted different reimbursements depending on where care occurred.

Rep. Tony Bacala also called the system broken and outdated, which made funding inequitable and often had decision-making not done transparently. He said the larger entities typically benefitted from the current system, with perhaps a small proportion of Medicaid patients, while some smaller ones, which had much larger proportions of Medicaid patients, needed relief.

Rep. Bubba Chaney asked how the bill would affect rural hospitals. Department of Health Undersecretary Jeff Reynolds said no rural hospital would see lower total reimbursements, even if the payment mix differed, by statute. Rep. Dustin Miller wondered if this was differential treatment, but Bacala said this created equity within different kinds of hospitals. He also worried whether putting this into law diminished flexibility, but Thomas said contemplated LDH rule-making was along these lines. Still, Miller said the Louisiana Hospital Association opposed it and flexibility was needed.

Rep. Julie Stokes said Bacala mischaracterized the distribution of monies for the East Jefferson Parish Hospital District as questionable. Bacala said it lacked transparency because the money went to the district that determined to which hospitals it went, something not determined or reported by the state. Stokes said it always had been done that way and nothing dishonest was going on. She also objected to Bacala’s assertion that larger hospitals would try to stop the bill as a bargaining tactic to slow administrative changes that would reflect the bill.

The LHA did send representatives to speak against the bill. They said the state should be leave the matter to administrative law, not statute. They also said the process was rushed and would end up needing fixing.

Thomas closed by asking for voluntary deferment, contingent upon LDH following through with its administrative changes. That was granted.

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