SADOW: The Senate’s Paper-Tiger Charity Hospital Resolution

What may seem to be an interesting and coming potential conflict between the state Senate and the Gov. Bobby Jindal Administration on paper in reality became conjured for reasons of image burnishing that changes nothing else.

Earlier this week, the Senate passed SR 28 by state Sen. Edwin Murray. The resolution, which is a kind of legal instrument that only may express the will of the body or may signal approval of an act where legally the body may intervene, states that, in regards to specific hospital management contracts, that before the state may enter into them any such contract “shall require the approval of the Senate Committee on Finance.” The state has agreed to contract out this management for most of its public hospitals currently run by the Louisiana State University System.

The resolution argues the Senate should do this because legislative approval is needed to close an emergency room or to reduce expenditures of a hospital more than 35 percent, and that Atty. Gen. Buddy Caldwell recently issued an “opinion of the attorney general [that] does not address whether the lease of an entire state hospital facility to a private entity constitutes the closure of the publicly owned hospital facility.” But this tortured logic ignores both statute and the opinion (13-0034).

For one thing, not even statute gives any part of the Legislature the ability to veto a contract as long as it meets certain criteria. R.S. 39:366.11 spells out the procedure, where the Joint Legislative Committee on the Budget, a combination of the Senate committee plus the House Appropriations Committee and two other legislative chairmen, before a contract may be implemented by an agency, must be delivered documentation about the public purpose sought to be accomplished by the cooperative endeavor, the reason a cooperative endeavor with the entity is the preferred means by which to accomplish the public purpose as opposed to competitively bid or competitively negotiated contract, and information about the nature and amount of all state resources being obligated, the nature of the obligation, and the expected duration of the obligation.

If and only if this information is not provided, the JLCB may prohibit the state from entering into that specific agreement. In essence, this means that as long as the contracting agency, through the Division of Administration, demonstrates the public purpose, why contracting to a certain party is a good means (note it does not even have to demonstrate cost savings), and the amount and duration of it, the JLCB cannot prevent the contract from going forward.

This part of statute immediately brings into question the constitutionality of the resolution. If by statute the JLCB has no approval power over contract information properly submitted, then how can the Senate empower one of its committees that is a part of the JLCB, bypassing statute, to arrogate an approval power?

If any doubt of the lack of constitutional standing for the resolution remains, Caldwell’s opinion demolishes that. In it, pointing out that at one time the Legislature did reserve the right to approve of leases of entire hospitals but amended that out of law in 2003, unambiguously he wrote, “legislative approval is not required in order for the LSU Board of Supervisors to lease an entire hospital facility under its management and control.” Murray tries to dance around this when he equated a lease to a “closure,” but the hospitals in question clearly will not close. The leases themselves by definition require them to remain open and operating.

Unless a court decides otherwise, the Legislature passes a deliberately conflicting statute, or the Constitution is amended to effectuate the same purpose, Caldwell’s opinion renders the definitive judgment of this statute’s interpretation. Simply, the Legislature, nor any part of it, is required to approve such a contract, nor has any authority to do so. Resolution trumps neither statute nor the Constitution.

So why did this not only come and get passed by the Senate, but unanimously? Because senators know these facts already. Unless they are ignorant of their powers and duties, they know that if they every complained about being bypassed concerning one of these in the future, they’ll be reminded of this. And if, out of courtesy, the Administration does submit an agreement and it for some reason the panel turns it down, they’ll lose by another opinion or in court. So it carries only symbolic meaning, a show for those discomfited by the move towards a more efficient and better performing indigent health care system that the Senate is looking out of them in a fashion.

But, obviously, as a paper tiger. It’ll be interesting to see whether the Jindal Administration will deign to allow this image boosting by senators and actually submit contracts, allowing a dog-and-pony show of faux approval but with the requisite remonstrations of Senate watch-doggery and thundering pledges of oversight, or it instead humiliates the chamber by ignoring its worthless resolution. Either way, this changes in no way the fact that the contracts will be consummated, and almost all of the charity hospital system will be under private management in a year’s time.

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