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January 2009

Louisiana Health First Plan

On December 20, Louisiana’s top financial committee, the Joint Legislative Committee on the Budget, gave Governor Bobby Jindal’s administration the go ahead to begin negotiations with the Center on Medicare & Medicaid Services (CMS) to attain a Medicaid waiver to overhaul the state’s health coverage system.  The proposed waiver, known as the Louisiana Health First Plan, is the result of the Health Care Reform Act of 2007, which directed the Department of Health and Hospitals to “lead an initiative to improve health care outcomes in Louisiana by developing and implementing a health care delivery system that provides a continuum of evidence-based, quality-driven health care services based on the medical home system of care.”  The major features of the Health First Plan are:

  • Expand access to coverage.
    • Medicaid eligibility would be expanded to parents and caretakers of children living below 50 percent of Federal Poverty Level (FPL) as well as those individuals diagnosed with a chronic disease.  Both groups would be allowed to use their health insurance premiums toward employer sponsored insurance, and if no such insurance was available, individuals would be covered by Louisiana’s CHIP program or existing state health plan.      
    • Medicaid eligibility would also be expanded for all individuals living below 200 percent FPL in Region 5 (the Lake Charles area which has the highest rate of uninsurance in the state).  Individuals in this region who earn between 200 and 350 percent FPL would be able to buy into the program with their contribution matched by federal funds on a sliding scale based on income.
  • Create a medical home-based system of care.
    • The Health First plan proposes to establish a number of Coordinated Care Networks (CCN) that will unite the now disparate efforts of primary care providers, specialists, and hospital providers into an integrated medical home for all Medicaid recipients.  Similar to other proposed medical home models, the Health First Plan calls for the CCNs to allow for more choice between health plans, offer enhanced benefits for healthy behavior, allow the CCNs to negotiate reimbursement rates directly with providers, use electronic medical records to improve coordination and move to a system where networks will be rewarded based on quality of care rather than volume of care, among other features.
  • Create an academic medical center
    • The Health First Plan aims to compete nationally for medical residents, faculty, and researchers by constructing an academic medical center in New Orleans with investments in new equipment and research.  The medical center would be run on a community-based, not for profit model, in collaboration with Louisiana State University and Tufts University.  The medical center, which is estimated to cost more than 1.2 billion dollars, will be funded by an appropriation by the Louisiana Legislature, seeking reimbursements from FEMA for damage done to Big Charity Hospital during Hurricane Katrina, and direct appeals to Congress for funding.

With the waiver submitted, CMS could take as long as six months to render a decision, and possibly longer with the transition to the new Obama administration.

For more information on the Louisiana Health First Plan see the white paper and fact sheet produced by the Louisiana Department of Health and Hospitals.