Cheryl Owens/News Editor
The Newton Record
NEWTON
August 06, 2008 04:24 pm
—
Gov. Haley Barbour was at the Neshoba County Fair on Thursday speaking with local media. On the balcony of the cabin amidst the noise and heat Gov. Barbour answered questions presented to him by local reporters for about an hour. This is how the question and answer session went.
Press: What is your view on Medicaid right now?
Barbour: What has happened in 2005 the federal government changed rules about what we could count as part of the state matched medicaid. The state has to put up one dollar and the federal government gives us back more than three dollars. We are paying a little less than a fourth and since 1993 we have used that particular mechanism called an intergovermental transfer. The federal government decided not only MIssissippi but a few other states were using that incorrectly, and of 135 million dolllars we paid in 2005 through the intergovermental transfer, in the future $90 million of that would not be eligible to be counted as state shares. We now have a 90 million dollar hole in the budget that we fill with federal Katrina emergency health care money. That money ran out this year and during the regular session of the legislature the legislature did not enact any resolution except to pass a deficit appropriation to cover the balance of the fiscal year that ended June 30, but they did nothing for going forward. I should add we don’t have a $90 million dollar budget hole because of over spending Medicaid. Since I have been governor spending has increased less than one percent per year, unlike the previous administration where it was going up 20 percent a year. The problem is that rules change, I called the legislature back into special session among other things to deal with how we would fill the hole to fully fund medicaid. Back in May the senate passed a bill to fill the hole by enacting a hospital tax designed by the Mississippi Hospital Association they had asked for. They had said this would be the way they preferred to fill the 90 million dollar hole. The house never passed that or any permanent fair substainable method for fully funded Medicaid, so we got to the end of fiscal year both our constitution and state law prohibited our running a deficit. There is a specific statute that requires the government to cut Medicaid spending in order to balance the Medicaid budget. When the end of the fiscal year came I said I would make those cuts, but there was a pending state court about this and the judge decided on July 10. On July 11 we announced the cuts, these cuts are very severe and bad for the system they are certainly nothing I won’t to go into effect but I took an oath to obey the constitution of the laws of Mississippi and I am going to keep that oath. We made that announcement on July 11, since then we think we have come up with a better way to make the cuts and do far less harm to our state health care system. Because of that we told the court in Jackson we were going to call off the hearing on Friday, because there was no use to have a hearing about something we were going to change. We have been negotiating and working with Medicaid in Washington. They have to approve anything we do and we are working with them for a better solution. We withdrew the cuts we announced on July 11 because we think we are going to be allowed by Medicaid in Washington to make the cuts in a much less harmful way, make no mistakes about it we have to make the cuts, unless the house decides to pass the senate bill, but since they haven’t done it in more than two months I assume they are not going to. If Washington approves what we are talking about, is consistent with existing state law and if it passes muster with the Feds then we can go on and put it into effect without any legislative action.
Press: What you are talking about working with the Feds in a less harmful way, will this be a long term solution or kind of like in 1993 which is basically what we have done in Mississippi year to year.
Barbour: I wasn’t around but they began a provider fee system in 1993. The hospital asked to have a tax put on them because it would allow bringing down more federal money, then the nursing homes did the same thing. In 2001 the hospitals asked for another tax to be put on them, the gross revenue accessment, so they could draw down more federal money. In each one of those cases it was additionality, it wasn’t correcting something that was wrong, it was a way to get more in. The Musgrove administration in 2003, right after the start of fiscal year 2004, spent 70 million dollars and didn’t put it on the books, literally didn’t enter it on the accounts. Later when that was discovered it was a big mess that had to be cleaned up. That did happen in 2004 and in 2005 the federal government changed the rules about how you could use it, so we did have two years back to back that the legislature hasn’t dealt with it in the long term since 2005, I do believe since the early nineties, and until 2004 accounting failure of the Musgrove administration. I think it rocked along pretty well except they would figure out ways to add to the program..
Press: Do you feel like with this program we are not going to deal with this issue in the future?
Barbour: If this gets approved as we have proposed we shouldn’t have to deal with this issue in the future, now that doesn’t mean the legislature won’t come back and say we would rather do it a different way, but this would be a fair permanent substainable solution.
Press: Would it affect some hospitals more than others?
Barbour: The hospitals that have fewer medicaid patients will do worse, primarily the private mental health hospitals. If you don’t get much medicaid back, but you have to participate in paying the providers fee you are coming out on the short end. If the hospitals want to lay people off it won’t be because of the medicaid solution.
One of the attractions of having this solution and the reason is, the harm is much smaller and doesn’t require legislation. There are a lot of people that believe the house leadership doesn’t want to pass anything, they want the governor to make the cuts.
Press: Is it that, or is it to force the issue of the cigarette tax in your opinion, or a little of both?
Barbour: I can’t look into any ones heart, but you can’t walk down the halls of the capitol without being told every twenty steps, when you know the house leadership doesn’t want a solution, they want to force the governor to make the cuts because they think politically it would hurt the Republicans.
Press: Do you believe if you relented on the cigarette tax that it would either put more pressure on them or actually pass something?
Barbour: Let’s talk about the underlying issue here, I don’t see this as politics, I see it as policy. In 1993 Mississippi made the decision we were going to establish a provider fee system so we could make our medicaid system larger. By 2005 provider hospitals and nursing homes paid 30 percent of the states share of Medicaid. This year that would be the equivalent of about 300 million dollars. The taxpayers paid about 650 million dollars. With out the provider fee system our program would be 30 percent smaller, instead of a four billion dollar medicaid program it would be about two and three quarter million. That is not in the interest of the state, that means less care for medicaid beneficiaries but also means a weaker healthcare system for all Mississippians because the providers would be denied 30 percent of what medicaid pays. The providers not only supported this, they thought it up, they brought the idea to the legislature. Why? Because for every dollar the hospitals pay in, they get back six, and the nursing homes get better returns. If you honestly believe the baloney argument that hospitals are paying a tax, that means they have to raise their rates, or your health insurance premiums would go up. If you really believe that baloney you ought to be for doing away with the provider fee system totally, right? No one wants to do away with the provider fee system, but if I sit here and say we are going to let the house give the hospitals a 90 million dollar tax cut and put that tax on the people that smoke, what am i going to say to the nursing homes? Why don‘t the nursing homes get to pay nothing if you really believe their promises. Point is none of them believe that. In 2001 we established a gross revenue accessment on hospitals, it is a tax everyone pays, it passed the house unanimously, none of them said one word, this is going to make hospitals raise your rates, instead they said with the hospitals getting back six dollars for every dollar they put up this will let hospitals keep their rates lower, this will keep insurance premiums from going up. I have a tax study commission that I have been told is going to recommend an increase in cigarette tax, I have told them and I have told newspapers and publishers and legislators, if they recommend to increase the cigarette tax i am not going to oppose it, I might not agree with it, but I’m not going to oppose it, but I sure will oppose using it to give the hospitals a big tax cut, not that i am mad at hospitals. We can not afford to undermine the provider fee system, 43 states do what we do, they charge taxes to their providers to generate more federal medicaid.
Press: Without putting words in your mouth, to make sure I understand, what you want them to do is what?
Barbour: Is to put hospital tax back where it was in 2005.
Press: If somebody wants a cigarette tax and it passes the legislature, you will sign it and put it in the general fund and spend it on anything?
Barbour: I am not going to oppose it, and it is important how it is spent, I think it should be put in the general fund, We are going to have a tough budget year. For the first time since I have been governor, this pass year, revenue came down under about 17 million dollars, which is about one third of one percent. Still the trend has changed from getting a lot more revenue than we expected this year. We got a little less, revenue went up only three point one percent the fiscal year that just ended. Revenue Estimating Committee predicts it will only go up two point one percent this coming year. We just started, revenue is going to be tight If we have a tax increase on tobacco, not just cigarettes, all tobacco products then I think we ought to hold money in general fund to see what we need it for, but you are not putting words in my mouth I told Billy McCoy and Phil Bryant that.
Press: Don’t you get an idea that statewide the constituents are in favor of tobacco law?
Barbour: When I got elected in 2003 I ran because we were in a terrible budget hole I said I was against raising anyones taxes, because raising taxes was purely by budget policy, not health or social policy. I bet the majority of people who voted for me, knowing I was against raising any taxes, including cigarette taxes, were for raising cigarette taxes. I have no questions about that, but my first four years we had to get our budget which was in the deepest hole in history, back in balance, and look, we didn’t have a 720 million dollar deficit becausee we taxed too little, it was because we spent too much, and you can’t control spending it. The legislature believes you are going to let them raise taxes, that is why during the campaign I was going to appoint this tax study commission and accept what they put forward in good faith. I said there is going to be adjusting some taxes up, but not to give the hospitals a tax cut on a tax they asked for, and benefit from more than anyone else.
Press: What is the biggest issue facing Mississippi today?
Barbour: I think the biggest issue facing our state today is four dollar gasoline, it is killing the family budget and in the last 60 days hurting our economy. We are seeing job losses relating to Nissan, we are seeing job losses in other non automotive areas. It causes people to change their conduct, they don’t shop as much, don’t go out to eat as much.and that has got to be dealt with. We are doing everything in Mississippi we can do, it is a national issue.how is
Press: How is Marsha doing since the surgery?
Barbour: Thanks for asking, she is recovering from surgery quite well; no malignancy and an excellent prognosis, but her recovery kept her from being with me today, for the first time in nearly 25 years.
Press: Any big economic development projects on horizon?
They don’t like you talking about it, I honestly believe why Toyota looked at us is because we can keep a secret.
We have projects going on in Mississippi that are slowing down because of the tightness of credit. We aren’t formally having a recession, the economy has grown every quarter, but very uneven. High energy crises are having significant effects so nowis not a good time to be out trying to drum up economic development prospects.
Press: What about pardoning Michael David Graham, what about the family, should their have been some contact?
Barbour: There was, Fordice pardoned or suspended sentences for about 32 people, a large number of trustees that worked at the mansion, Musgrove about twenty six, including a number that worked at mansion. Since 1941 the servants at the governors mansion were all trustees. Since I have been there they have all been murderers, from the state penal system. The Department Of Corrections decides who can be a trustee and recommends to the Department of public safety who should work at mansion, the governor has nothing to do with it, but the DOC sends us trustees who have been trustees in the penal system before they are ever considered to be trustees at mansion. The trustee works hard to get there, has a really clean record. It gives them a chance to have a second chance. Unlike most in history I am serving a second term, there have only been two governors to serve two consecutive terms. When I got here I told the DPS when they were interviewing the inmates, if they did their job and stayed out of trouble, had a blemish free record, at the end of my first term I would pardon them and that was the case. We first had to publish a public notice, write family of victim, write judge and write the prosecutor. I did hear from the district attorney and sheriff of Jackson county on Graham, instead of pardoning him I gave him a revocable suspended sentence.
I can’t take back a commutation, if I commute your sentence I can’t put you back in jail, I gave him a revocable suspension, which means if he gets in trouble, doesn’t have a job or goes back to Jackson County, I can revoke him and he will have to go back to the penitentiary. Graham committed an awful crime, but he has spent 20 years paying and does literally have a blemish free record, so I am treating just like I told them I would. If they stood up to the test I will do what governors have done for decades, I would give them a second chance. I hope Michael Graham will go out and work hard and five years from now I will get to pardon him.
Copyright © 1999-2008 cnhi, inc.
Photos
Barbour The Newton Record