500 DHH employees could lose jobs

By Robert Morgan

July 20, 2000 Web posted at: 3:35 PM EDT (1935 GMT)

BATON ROUGE, Louisiana (The Town Talk) -- The Department of Health and Hospitals has been working on a plan for cutting $50 million from its budget that will maintain health-care services although it may cost 500 employees their jobs and cause some inconvenience for clients, DHH Secretary David Hood said.

The plan calls for a reduction of $33 million in state General Fund money from DHH's $4.2 billion budget with the rest of the cuts being federal funds, officials said.

Hood said a proposed plan for scaling back health-care spending has been submitted to the Division of Administration and the governor's office for final approval.

"We're going to look at everything we can before we start closing services," Hood said in a telephone interview.

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DHH, along with other state agencies, was forced to reduce spending for the 2000-01 fiscal year after the Legislature refused to raise enough taxes to fully fund Gov. Mike Foster's original budget plan.

After it became clear the Legislature was not going to pass a single business tax, oil processing tax or any of the other major revenue measures proposed, Foster submitted a revised budget he said would cut more than 4,400 jobs from state government, including about 1,750 in DHH.

In the final version that was passed, the budget called for elimination of about 975 positions in DHH, Hood said, adding that will result in layoff of perhaps as many as 500 employees.

He declined to provide details of closures and cutbacks until the plan is approved by the administration, probably within two weeks.

But he said the department's first priority is to maintain services to patients.

Explaining the philosophy that has gone into the proposed reductions, he said, "First, we're going to cut administrative costs. Then we're going to look at everything that's duplicative, (and) anything that can be consolidated."

Some facilities are going to be closed, as was made evident by the decision to close three of seven testing laboratories operated by the Office of Public Health, including one in Alexandria.

DHH Communications Director Bob Johannessen said closures are being proposed for efficiency reasons rather than simply cutting expenses.

Cutbacks in DHH, particularly closure of health clinics and other facilities, were hotly debated in the Legislature, and lawmakers tried to force disclosure of specifics by Hood even before the budget was passed.

The Legislature passed a resolution directing Hood to release details of his budget-reduction plans, including a list of facilities to be closed.

But Hood responded with a letter saying he could not provide details until he had a final budget in hand and knew the actual level of funding for his department.

He said DHH has been working on plans for reducing costs for months after it became apparent in 1999 that state revenues were declining.

The final plan was only completed recently, however, because Hood refused to accept some of the recommendations offered by his section heads, he said.

"In some cases it was (a situation in which) we would look at it and say that this is something we don't want to do, the impact on patients is too harsh," he said of the delays.

The proposed plan calls for reductions in high-cost areas that are expected to allow expansion in other areas, in hopes of improving services and efficiency, he said.

As an example, he said, the plan calls for a reduction in inpatient beds at the New Orleans Adolescent Hospital, a facility that treats juveniles with mental-health problems.

"What we're looking at is not closing the New Orleans Adolescent Hospital. We're looking at reducing the inpatient beds at the hospital, and we're looking at improving the services provided at the outpatient clinics operated by the hospital," he said.

Not only does the proposal offer a chance for more efficient delivery of services, it revises DHH philosophy for treatment of juvenile mental patients to conform with the most current accepted methods, he said.

"The current view is that juveniles should not be treated in inpatient facilities but through outpatient services," he said.

But he said NOAH will not be closed because there is still a need for inpatient treatment in extreme cases.

He said the plan for redirecting services at NOAH is an example of the approach being taken statewide to make the necessary budget cuts and still maintain services.

"We see opportunities there to shift those dollars into more efficient care in community services.

I think that's what the taxpayers expect us to do," he said.

Citing funding cutbacks for DHH since 1996, he said, "Certainly within our department we've been able to maintain services with a lot less money."

DHH has 1,250 fewer employees than it had in 1996, even before elimination of 975 jobs in the current fiscal year, he said, adding the department's budget has dropped from $5.7 billion in 1995 to $4.2 billion this year.

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