Louisiana Medical Assistance Trust Fund, Amendment 1 (2014)

Amendment 1 Origin Louisiana State Legislature Topic Healthcare Status Approved a

2014 measures November 4 Amendment 1 a Amendment 2 a Amendment 3 d Amendment 4 d Amendment 5 d Amendment 6 a Amendment 7 a Amendment 8 a Amendment 9 d Amendment 10 a Amendment 11 d Amendment 12 d Amendment 13 d Amendment 14 d Endorsements

The Louisiana Medical Assistance Trust Fund, Amendment 1 was on the November 4, 2014 ballot in Louisiana as a legislatively referred constitutional amendment, where it was approved. The amendment gave constitutional protection to the Medical Assistance Trust Fund. It forbade the legislature from raiding the trust fund to use funds for other budgetary purposes. The measure also set a baseline compensation rate for nursing homes, pharmacies and intermediate-care facilities that pay provider fees.

Amendment 1 did not establish any new provider fees.

The measure was sponsored in the Louisiana Legislature by State Representative Charles Kleckley (R-36) as House Bill 533.

Election results

Louisiana Amendment 1
Result		Votes	Percentage
a Yes		777,310	56.15%
No		606,983	43.85%

Election results via: Louisiana Secretary of State

Text of measure

Ballot title

Note: While the ballot question says, "to create," there is already a statutorily defined trust fund. The amendment will make this fund constitutionally defined.

The official ballot text reads as follows:

“

Do you support an amendment to authorize the legislature to create the Louisiana Medical Assistance Trust Fund, for the payment of Medicaid reimbursement to the health care provider groups paying fees into the fund? (Adds Article VII, Section 10.14)

”

Constitutional changes

See also: Article VII, Louisiana Constitution

The proposed amendment added a Section 10.14 to Article VII of the Constitution of Louisiana:

§10.14. Louisiana Medical Assistance Trust Fund

(A) There is hereby established as a special fund in the state treasury the Louisiana Medical Assistance Trust Fund, hereinafter referred to as "the fund", which shall consist of monies generated by fees as provided for in law. Subject to the exceptions contained in Article VII, Section 9(A) of this constitution, and after compliance with the requirements of Article VII, Section 9(B) of this constitution relative to the Bond Security and Redemption Fund, the treasurer shall deposit all proceeds from the fees collected as provided for in laws relative to the Louisiana Medical Assistance Trust Fund into the fund. The monies in the fund shall be invested by the state treasurer in the same manner as monies in the state general fund. All interest earned from the investment of monies in the fund shall be deposited in and remain to the credit of the fund. All unexpended and unencumbered monies remaining in the fund at the close of each fiscal year shall remain in the fund.

(B) The treasurer is hereby authorized to establish a separate account within the fund for each health care provider group in which fees are collected according to law. Monies collected from each provider group, and the interest earned on those monies, shall be deposited into the account created for that provider group. Any monies deposited into the fund from sources not required by law, and the interest earned on those monies, shall be deposited into a separate account within the fund, hereafter referred to as "the general account".

(C) The legislature is authorized to appropriate monies from the fund only if the appropriation is eligible for federal financial participation under Title XIX of the Social Security Act, or its successor. The balance of each account shall be appropriated for reimbursement of services to the provider group which paid the fee into the account in any fiscal year, except monies deposited into the general account may be appropriated for any Medicaid Program expenditure.

(D) The monies appropriated from the provider accounts in the fund shall not be used to displace, replace, or supplant appropriations from the state general fund for the Medicaid Program below the amount of state general fund appropriations to the Medicaid Program for Fiscal Year 2013-2014.

(E)

(1) The legislature shall annually appropriate the funds necessary to provide for Medicaid Program rates for each provider group which pays fees into the fund that is no less than the average Medicaid Program rates established for Fiscal Year 2013-2014 and which may be adjusted annually by establishing the rates of inflation, or rebasing if applicable, which rates shall not be negative, to be applied to the base rates to establish the new base rates for the next fiscal year as authorized by law. For the purpose of this Section, "Medicaid Program" shall refer to the Louisiana medical assistance program provided for in Title XIX of the Social Security Act, or its successor.

(2) Notwithstanding Article VII, Section 10(F) of this constitution, neither the governor nor the legislature may reduce the base rate as provided for in this Paragraph to satisfy a budget deficit, except the governor may reduce the appropriation for the base rate if the following occur:

(a) Such reduction does not exceed the average reduction of those made to the appropriations and reimbursement for other providers under the Medicaid Program, or its successor; and

(b)(i) If the legislature is in session, the reduction is consented to in writing by two-thirds of the elected members of each house in a manner provided by law; or (ii) If the legislature is not in session, the reduction is approved by two-thirds of the members of the Joint Legislative Committee on the Budget, or its successor.

Background

Medical Assistance Trust Fund

Prior to Amendment 1's approval, nursing homes, community pharmacies and intermediate-care facilities were assessed a fee, which was deposited into the Louisiana Medical Assistance Trust Fund. Money in the fund was used to "draw down" federal dollars through the Federal Medicaid Matching Rate. These Medicaid dollars were used to compensate medical care facilities that provided care to low-income patients. The nursing homes, community pharmacies and intermediate-care facilities that paid a fee were, in return, given back more money due to the federal funds and at no extra cost to taxpayers.

The federal money, however, had been used for other healthcare needs, rather than for the healthcare facilities who paid the provider fees.

Support

The measure was introduced into the legislature by Rep. Charles Kleckley (R-36).

A full list of legislators by how they voted on the amendment can be found here.

Supporters

Officials

• Sen. Ronnie Johns (R-27)
• Sen. Fred Mills, Jr. (R-22)
• Sen. Gregory Tarver (D-39)
• Rep. Charles Kleckley (R-36)
• Rep. Walt Leger III (D-91)

Organizations

• Louisiana Hospital Association

Arguments

The Public Affairs Research Council provided arguments for and against the constitutional amendment. The following was the council's argument in support:

“	Quality institutional healthcare for the elderly and disabled should be among the state’s highest priorities. Funding for these services should receive the maximum possible financial protection. This amendment would provide protections for these health care providers by constitutionally dedicating funds that result from the provider fees paid by these groups. Many other states have a provider fee program for nursing homes and intermediate care facili- ties. The amendment would not increase a fee or create a new one but would simply revise and protect how the current fee is used. The newly required minimum financing system would guarantee that the healthcare providers would get a fair deal in return for their fee investment. The minimum reimbursement rate for providers could change the incentive structure to per- suade more providers to offer medical services. Increasing the number of providers can bring greater competition to the marketplace.	”
—Public Affairs Research Council

Opposition

A full list of legislators by how they voted on the amendment can be found here.

Arguments

The Public Affairs Research Council provided arguments for and against the constitutional amendment. The following was the council's argument against the amendment:

“	This amendment would reduce the state’s budget flexibility. Higher education could be at greater risk for budget reductions. Constitutional provisions that limit the budgetary options of policymakers should be avoided. This change would make management of the Medicaid program more difficult. Some advocates of home and community based long-term health care are critical of this amendment. They say it fosters a system that will weigh against individuals with disabilities who want to remain in their homes and communities but will have less opportunity for home care compared with institutionalized care in nursing homes. Such disparate treatment has triggered court cases in the past and could lead to additional litigation.	”
—Public Affairs Research Council

Path to the ballot

Louisiana Constitution
Preamble
Articles
1 • 2 • 3 • 4 • 5 • 6 • 7 • 8 • 9 • 10 • 11 • 12 • 13 • 14

See also: Amending the Louisiana Constitution

State Representative Charles Kleckley (R-36) introduced the amendment into the legislature on March 29, 2013. The measure was approved through a two-thirds vote in both legislative chambers. HB 533 was approved by the Louisiana Senate on May 28, 2013. The amendment was approved by the Louisiana House of Representatives on June 2, 2013.

Senate vote

May 28, 2013 Senate vote

Louisiana HB 533 Senate Vote
Result		Votes	Percentage
a Yes		34	89.47%
No		4	10.53%

House vote

June 2, 2013 House vote

Louisiana HB 533 House Vote
Result		Votes	Percentage
a Yes		82	92.93%
No		7	7.07%

Related measures

• Louisiana Hospital Stabilization Fund, Amendment 2 (2014)

See also

Suggest a link

• 2014 ballot measures
• Louisiana 2014 ballot measures
• Louisiana Legislature

External links

• House Bill 533
• Public Affairs Research Council Guide to the 2014 Constitutional Amendments