BATON ROUGE, La. — After threatening to oust the contractor, Gov. John Bel Edwards’ administration has reached a renegotiated management deal with the operator of the LSU charity hospitals in Shreveport and Monroe, the governor’s chief lawyer said Monday.
Edwards executive counsel Matthew Block said he expects to have a signed agreement within days between the state, LSU and the Biomedical Research Foundation of Northwest Louisiana, known as BRF.
“I think we have an agreement that is something that provides the accountability that I think is important so we can explain to the taxpayers how their tax dollars are being spent properly,” Block said.
The reworked arrangement comes less than two weeks after Edwards moved to remove BRF as the hospitals’ manager because foundation leadership refused new contract terms sought by the governor.
Under the renegotiated deal, BRF will provide $37 million in additional payments to the LSU medical school in Shreveport for its doctor’s services at the hospitals in the current budget year, Block said.
The hospital operator also will pay at least $6.9 million within the next two weeks that LSU says it is owed in unpaid bills, Block said. Another $5.3 million for disputed billings will be placed into an escrow account, while an outside arbiter is hired to determine whether LSU should receive that money. Block said the costs of the independent arbitration will be split between LSU and BRF.
BRF didn’t respond to a request for information on the renegotiated terms. LSU spokesman Jason Droddy said the university system recently received the documents and was combing through them. He acknowledged the terms include increased payments for LSU physician services and to the medical school for disputed bills.
“There are some aspects that are agreeable, but we haven’t completed our review yet,” said Droddy, executive director of policy and external affairs.
BRF is operating the Monroe and Shreveport hospitals as University Health, under a 2013 contract struck by former Gov. Bobby Jindal that has been criticized as unfavorable and costly to the state.
Jindal privatized nine LSU-run hospitals and clinics that cared for Louisiana’s poor and uninsured through no-bid contracts, with the earliest deal starting in April 2013. The state is spending more than $1.1 billion on the contracts this year.
The Edwards administration was seeking to add fixed dollar amounts that each hospital can receive, new data collection requirements on patient care, certain payment rates for the services of LSU’s physicians and other adjustments.
Besides BRF, all the other hospital and clinic operators signed renegotiated agreements with the Edwards administration last month.
BRF officials claimed the Edwards administration was offering “significantly worse terms” in the new operating agreement. But the terms outlined by Block on Monday still include many of the items that the hospital manager criticized.
The privatization deal in north Louisiana has been contentious with both LSU and BRF trading accusations of financial mismanagement.
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