As U.S. Sen. David Vitter thumps his chest over passage of the Transportation Bill, the Louisiana Democratic Party is laying deep Medicaid cuts at his feet. U.S. Sen. David Vitter is thumping his chest over the imminent signing by President Obama of the Transportation Bill, trumpeting the bill's inclusion of the Restore Act, which requires 80 percent of the proceeds from Clean Water Act violation fines paid by BP be earmarked for Gulf Coast states and coastal restoration. The junior senator from Louisiana is calling passage of the bill a "triple win," also citing reauthorization of National Flood Insurance Program and an increase - from 93.7 cents to $1.02 - in the state's return rate from the feds for state tax dollars spent on highway projects.
Vitter was a member of the Conference Committee - the panel representing both chambers of Congress tasked with squaring Senate and House versions of the bill - that produced the final Transportation Bill awaiting Obama's signature. And the Louisiana Democratic Party is hitting him hard on another rider in the bill that slashes federal Medicaid funds to Louisiana, suggesting the cuts will "kill the LSU Hospital System":
Louisiana officials, health care leaders and others were stunned to learn that the Conference Committee Report on the Transportation Bill included claw backs of Medicaid money overpaid to the state in 2010. That money had originally been obtained by Senator Mary Landrieu to offset what would have been devastating cuts in federal support for Louisiana Medicaid. An error in the calculation of the money to be paid the state created a claim by the federal government for repayment.
Negotiations had reached something of a standoff until the final version of the Transportation Bill emerged from the Conference Committee, taking back all of the money over the next two fiscal years. The federal Medicaid reimbursement to Louisiana was reduced $425 Million in the state fiscal year that started on Sunday, with another $226 Million in the fiscal year that begins on July 1, 2013.
That cut opened a gaping hole in the Louisiana Medicaid budget that state officials now must address. The state has no additional dollars, so Draconian cuts will have to make up for the 11% cut in Medicaid funding lost in the current fiscal year.