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 Press Releases

4/29/2016
Bills to Cut Consulting Contracts Advance to House

BATON ROUGE, LA - The House Appropriations Committee this week advanced two bills that rein in the number of consulting contracts across state government, according to State Treasurer John Kennedy.

"We had $12.23 billion in contracts last year. State agencies will tell you every one of those contracts is necessary. I disagree," said Treasurer Kennedy. "We have to get our spending in check."

House Bill 454 would create a layer of legislative oversight for professional, personal and consulting service contracts totaling $25,000 or more. Those contracts would have to be reviewed by the Joint Legislative Committee on the Budget.

House Bill 74 would decrease by $183.2 million the contracts paid with State General Fund dollars in the upcoming state budget year that starts July 1. The decrease equals the amount of money needed to make TOPS whole.

Both bills are sponsored by state Rep. Dee Richard of Thibodaux. They now go to the House floor.

"These are common sense solutions to the spending frenzy that is occurring with state contracts," said Treasurer Kennedy. "We're sending millions of dollars out the door when we could do this work in-house or not waste the money at all."

4/21/2016
State Bond Commission Approves $128 Million for Local Projects

BATON ROUGE, LA - The State Bond Commission approved $128 million for projects statewide and approved more than $5 million in interest savings at its April 21 meeting, according to State Treasurer John Kennedy.

 

"We had a jam-packed agenda that benefitted towns across Louisiana," said Treasurer Kennedy. "We approved savings for taxpayers in Youngsville, Livingston, Lecompte, Lamourie, Woodworth and other areas of the state.  It's important to refinance this debt so that we can capture as much in savings as possible."

 

Among the individual projects approved were:

 

  • Allen Parish, $4.8 million in General Obligation School Refunding Bonds for the Allen Parish School Board, School District No. 25: saving taxpayers $233,928.
  • Caddo Parish, $7.5 million in General Obligation Refunding Bonds for the Caddo Parish Commission: saving taxpayers $376,080.
  • Calcasieu Parish, $7.75 million in General Obligation Refunding Bonds for the Calcasieu Parish School Board, School District No. 26: saving taxpayers $326,090.
  • Calcasieu Parish, $10.6 million in General Obligation Refunding Bonds for the Calcasieu Parish School Board, School District No. 30: saving taxpayers $576,465.
  • Calcasieu Parish, $5.4 million in General Obligation Refunding Bonds for the Calcasieu Parish School Board, School District No. 34: saving taxpayers $150,200.
  • Lafayette Parish, $3.75 million in Sales Tax Refunding Bonds for the city of Youngsville: saving taxpayers $117,292.
  • Livingston Parish, $5.6 million in Utility Systems Revenue Refunding Bonds for the town of Livingston: saving taxpayers $323,856.
  • Livingston Parish, $26 million in Revenue Refunding Bonds for the Louisiana Community Development Authority's Denham Springs Utilities Project: saving taxpayers $1,378,262.
  • Natchitoches Parish, $6.6 million in Refunding Bonds for Waterworks District No. 2: saving taxpayers $402,821.
  • Ouachita Parish, $6.3 million in Water Treatment Utilities Revenue Bonds for the town of Sterlington: for (1) acquisition, construction, and installation of a water system with related infrastructure improvements, extensions, modifications, and additions to the sewer system and (2) funding a debt service reserve fund, if required.
  • Rapides Parish, $6 million in General Obligation School Refunding Bonds for the Rapides Parish School Board, Lecompte-Lamourie-Woodworth School District No. 57: saving taxpayers $254,911.
  • Red River Parish, $3 million in Certificates of Indebtedness for the Parishwide Fire Protection District: for upgrading buildings and equipment.
  • St. James Parish, $500,000 in Taxable Limited Tax Bonds for the town of Gramercy (DHH Program): for (1) constructing additions and improvements to the waterworks system and (2) acquiring necessary equipment and furnishings, including other incidental costs and fees.
  • St. John the Baptist Parish, $7.2 million in General Obligation School Refunding Bonds for the St. John the Baptist Parish School Board, School District No. 1: saving taxpayers $304,113.
  • St. Martin Parish, $8 million in Taxable Utilities Revenue Bonds for the city of Breaux Bridge's DEQ Project: for constructing and acquiring additions, extensions and improvements to the sewer portion of the combined water and sewer system.
  • St. Mary Parish, $700,000 in General Obligation Refunding Bonds for the Water and Sewer Commission No. 4: saving taxpayers $68,643.
  • St. Mary Parish, $7.5 million in Sales Tax Refunding Bonds for the St. Mary Parish Council: saving taxpayers $228,479.
  • St. Tammany Parish, $4.050 million in Limited Tax Certificates of Indebtedness for Fire Protection District No. 2: for (1) approximately $3,000,000 for acquiring, constructing and improving fire protection facilities and equipment and (2) approximately $1,050,000 for refunding and extending Limited Tax Certificates, Series 2009.
  • Webster Parish, $600,000 in Sales Tax Revenue Bonds for the city of Springhill: for (1) acquiring, constructing, extending, improving maintaining and operating sewer and sewerage disposal facilities, roads streets and bridges, and (2) other capital improvements.
  • Webster Parish, $3.2 million in General Obligation School Refunding Bonds for the Webster Parish School Board, Consolidated School District No. 1: saving taxpayers $157,071.
  • Webster Parish, $3.2 million in General Obligation School Refunding Bonds for the Webster Parish School Board, Sarepta School District No. 35: saving taxpayers $168,209.
  • West Carroll Parish, $100,000 in Certificates of Indebtedness for Goodwill Fire Protection District: for constructing a fire station, including acquiring equipment and fixtures.

 

The Louisiana State Bond Commission meets monthly to review and approve applications from parishes, municipalities, special taxing districts, and other political subdivisions of the State requesting authority to incur debt. For more information, visit www.LATreasury.com.

4/20/2016
Treasury Uncovers Almost $45 Million For Insurance Beneficiaries

BATON ROUGE, LA - By checking life insurance companies' records, the Louisiana Department of the Treasury has uncovered nearly $45 million in death benefits that should have been paid to Louisiana residents, State Treasurer John Kennedy announced today.

"This is why we look at insurance companies' records. We always find policies that should have been paid but weren't because families didn't know the policies existed. We've received an additional $10 million in death benefits since September," said Treasurer Kennedy. "Sometimes we uncover $5,000 that should have been paid to a family. Other times, we uncover a lot more than that."

The Louisiana Department of the Treasury works with Versus Financial LLC to compare outstanding policies to the Social Security Death Master File (DMF). These audits reveal instances in which insurance companies failed to locate beneficiaries or heirs and pay them. The Louisiana Treasury has been conducting the audits since 2009.

"All of the money goes into our Unclaimed Property Program, where it remains until you claim it," said Treasurer Kennedy. "This past weekend, 900 people found money through our online database. You should check often because we're constantly getting in new money."

Treasurer Kennedy encourages Louisiana residents to search for missing money online at www.LATreasury.com or call the Treasury's toll-free hotline at 1-888-925-4127, Monday-Friday, 8 a.m. to 4:30 p.m.

 Opinion Columns

4/25/2016
Stop Food Stamp Abuse
 


Too many people in Louisiana are on food stamps. Every politician in Baton Rouge knows it, but few are willing to say it.

Let me be clear. I'm not talking about our oilfield families who have faced layoffs or reduced schedules. I'm not talking about folks still recovering from the recent floods. No, I'm talking about able-bodied adults between the ages of 18-49 with no dependents who have been unemployed for years.

I have the utmost compassion for those families who truly need assistance, and I do believe society should offer a basic safety net to help them transition into better jobs and careers. But I have absolutely no tolerance for individuals who abuse the system by stealing hard-earned taxpayer dollars, who steal resources from the truly needy, and who should be working in the first place. Instead, we need justice for that kind of abuse, and I think Louisiana citizens want that as well. Two bills currently before the Legislature move us closer to that kind of accountability, and I hope the Governor will support them.

House Bill 594 by state Rep. Jay Morris would require legislative authorization to eliminate the federal food stamp work requirements for able-bodied adults aged 18 to 49 without dependents. This authorization is important because, as citizens may remember, the Governor requested a waiver for food stamp work requirements upon being elected without any input from the Legislature. This bill ensures that the Legislature will have a say in the matter.

Next, House Bill 987 by state Rep. Mike Johnson allows individuals who are fraudulently using food stamps to be prosecuted and requires them to pay back the assistance they received. The reports of abuse in North Louisiana after the storms, in which individuals not affected by the floods were obtaining food stamps, are downright disgraceful. Those are dollars that should have gone to actual flood victims and their families. The Louisiana Department of Children and Family Services required no proof of damage because it said it would take too much time to process. Instead, all DCFS asked for was a form of identification. This bill would ensure that the whistleblowers reporting the fraud are protected and that violators pay back the taxpayer dollars they stole.

 

These bills offer common sense requirements that most citizens probably assume are already being enforced. Unfortunately, common sense and state government don't always go hand-in-hand. Food stamps should not be a way of life when you are able-bodied, have no dependents, and can go find a job and work the minimum of 20 hours a week to receive assistance. Food stamps are supposed to be a helping hand so that you don't starve while you're crossing the bridge between poverty and self-sufficiency. The American dream isn't a life spent on food stamps; it's a life spent in pursuit of prosperity.

 

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3/22/2016
How To Stop Medicaid Fraud

Not long ago, employees at a Minnesota mental health agency blew the whistle on what they described as years of Medicaid fraud. Officials are still tallying up the damage, but the fraud is estimated to be in the millions of dollars.

Do a Google search for Medicaid fraud in Louisiana, and you'll find that it's not just a problem for our neighbors in the north. Medicaid fraud is a problem across the U.S., and that includes Louisiana.

Here in Louisiana, a Prairieville couple started a personal health care business funded solely with Medicaid money. Then they skipped the mandatory training that their workers were supposed to receive to become certified personal care attendants. Not only did this couple bill the Medicaid program more than $7 million, but they put their patients' lives at risk by assigning them care workers who couldn't even perform basic life-saving measures.

The Medicaid program is big and complex. It's ripe for fraud and abuse. It's no surprise that people are cheating the system. And, in Louisiana, Medicaid is an $8.3 billion program. Dr. Donald Berwick, former administrator of the federal Centers for Medicare and Medicaid Services under President Obama, testified to Congress that 10% of Medicaid spending is fraudulent. That's $830 million in Louisiana.

We're struggling as a state right now. We're talking about making drastic cuts to public services. We ought to be talking about taking drastic measures against Medicaid fraud.

Fraud comes in different forms. Some of it's easy to prevent. For example, California uses data analytics (the science of using algorithms to examine raw data in order to draw conclusions from the data), similar to that used by credit card companies, to identify provider billing trends and anomalies that indicate fraud, thereby stopping the fraud before a fraudulent claim is paid. Front-end anti-fraud measures like this save more taxpayer money than trying to recover the funds after the fact, sometimes referred to as the "chase-and-pay" approach.

Though technically not fraud, we also need to discourage Medicaid patients from treating emergency rooms like a primary care doctor's office. We can place community health workers in ER waiting rooms to redirect to private providers those with problems that aren't really emergencies. Houston's Memorial Hermann Hospital accomplishes this through the Patient Navigator Program. We can also require copays for emergency care for nonemergencies.

Additionally, we need to ensure that those receiving Medicaid actually are eligible for it. This is a bigger problem than you might think. Pre-enrollment investigations (including background checks) of applicants to make sure they qualify for Medicaid is vitally important.

In Louisiana, Bayou Health is the way most Medicaid patients receive care. Five Managed Care Organizations, or MCOs, administer the program. They pay the doctors and the other providers. The state pays the MCOs a fixed amount per month, per Medicaid patient to manage the patient's care, and the MCOs pay the doctors and other providers a portion at the fixed per member, per month rate to treat the patient. Those rates are where the money is. Overpayments due to fraud trigger a higher rate, as a Washington state audit of its MCOs shows. The incentive to root out the fraud, or the payments that shouldn't be made, can be strengthened because each year's new rates are based on last year's rates.

Do the math. If we stop just a fraction of the fraud - and there's probably much more than that - we'd save the state between $150 million and $200 million a year. Think about that. We wouldn't have to worry as much about how to pay for TOPS. We wouldn't have to worry as much about how to pay our hard-working teachers. All we've got to do is keep a better eye on the Medicaid cash register. Right now, we're keeping the cash register drawer open and asking people not to help themselves to any money while we go on break. Then we're paying them for every dollar that's stolen.

What we also need to do is put more auditors at the state Department of Health and Hospitals, as envisioned by House Bill 89 in the 2016 special session, which failed to pass. We need to give each auditor a desk, a computer and a coffee cup with his name on it. We need to let them know that what they're going to be doing for years to come is stopping the state from making fraudulent Medicaid payments. And we need to put them to work now.

2/10/2016
Consultant Spending Spree Continues in State Government

The state Division of Administration just released its 2014 - 2015 Annual Report on Professional, Personal, Consulting and Social Services Contracts. A copy can be found here.

According to the report (page 4), "During the period 07/01/14 through 06/30/15, 4,017 contracts and amendments worth approximately $14.5 billion were approved by the OSP-PC [Office of State Procurement]." That's "b" as in billion, though the taxpayer money will be spent over several years.

The following are a few of those consulting contracts:

 

 

Louisiana families and Louisiana businesses are being asked to cut their budgets so Louisiana state government does not have to cut its budget. Before we enact the largest tax increase in the history of our state, we should review these 4,017 new consulting contracts and the other 19,000 that the state has with an eye towards saving money. Those contracts that are not as important as universities, public schools, roads, health care, coastal restoration and our other priorities should be eliminated. The remaining consultants should be asked for at least a 5% discount.

These simple actions could save millions of dollars for Louisiana taxpayers. We don't have a revenue problem nearly as much as we have a spending problem.
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