The Financial Risk of Charity Hospital “Privatization”

By John N. Kennedy. State Treasurer The reason advanced by the Jindal Administration for privatizing Louisiana’s charity hospitals is that a private hospital like Lafayette General or Ochsner, for example, can manage a hospital more efficiently, and therefore cheaper, than the state. That’s why I was taken aback when the chairman of the private entity taking over the Shreveport state hospital testified before the Joint Legislative Committee on the Budget that the private contractor’s costs to run the Shreveport facility will be the same as the state’s. Where, then, will the Jindal Administration’s promised annual savings of $150 million come from if not from achieving operational efficiencies?
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