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Political anger now points to hospitals

ATLANTA --- The target of political anger has shifted from the University System of Georgia's Board of Regents to the state's hospitals.

It's not that the regents are entirely out of the doghouse with legislators, but there's a new subject. Before the regents, it was the State Transportation Board. At the start of the session, it was lobbyists.

Lobbyists were indirectly blamed for some political careers being shaken up before the session began, most notably with the resignation of House Speaker Glenn Richardson.

Next, the Transportation Board angered legislators and Gov. Sonny Perdue early in the legislative session by voting to switch from a cash to an accrual accounting system. While that may sound pretty esoteric, the switch put the Department of Transportation onto the path that had led to more than $450 million being overspent, which required the virtual halt in new projects until the overage was paid down.

Accrual accounting wasn't entirely to blame, and several lawmakers were pushing legislation to formally authorize it. They were peeved that the board voted to change to accrual before the legislation could become law.

That tempus dissipated when the board reversed itself.

Then along came the Board of Regents to catch some grief.

The regents' crime? First, they raised tuition and fees to avoid the pain of last year's budget cuts and even gave pay raises to some faculty and administrators. Then, they iced the cake with the list of possible cuts they could enact if the University System were asked to shoulder the entire $300 million revenue shortfall that was predicted.

The most dramatic cut, which would only yield $6.5 million, was the ending of the popular youth 4-H program. It overloaded legislators' Blackberries with e-mails from seemingly every fourth-grader in the state, pleading for another chance to go to Rock Eagle.

By the time Perdue announced Thursday that he was recommending another $120 million be whacked from the system's budget, it almost seemed like good news in comparison.

In the press conference when he announced the university cuts, Perdue flashed his anger at the latest objective, the hospitals.

Their transgression was in not going along with a scheme he proposed to milk more money from the federal government. It's complicated, and it required the hospitals to pay a 1.6 percent tax on their revenues, money many of them would recover by upping their costs, which the federal share of Medicaid was to pay. While some large hospitals that treat loads of Medicaid patients would have come out ahead, many private hospitals would have been the losers.

The hospital lobby refused to buy in. It argued instead for a higher tax on cigarettes.

Ironically, the hospital lobby's political contributions are far greater than those of the tobacco companies, and the hospitals still lost their battle, at least so far.

The governor told reporters he was disappointed in the hospitals.

"Frankly, I don't think the hospital community has been fair with the citizens of Georgia," he said. "They have not addressed this the way I have had to address this with a balanced budget. They've offered no ideas other than 'to cut them or raise money elsewhere.' And that's unacceptable."

Perdue said if they didn't want to pay a 1.6 percent tax, maybe they'd rather have a 10.25 percent cut in what they're paid by Medicaid. On top of that, he wants to take away nonprofit hospital's exemption from sales tax on the supplies they buy.

Immediately, the hospital groups dusted off quotes they use every year predicting dozens of facilities will soon close. Next comes an even more intense lobbying campaign than had already been engaged to stop what they called the "sick tax."

Perdue's proposal isn't a done deal, but legislative leaders are open to consider it, like Lt. Gov. Casey Cagle.

"Balancing the budget is the lieutenant governor's top priority, and we are working to reach consensus on the medical portion of the budget," said Cagle's spokeswoman, Jaillene Hunter.

With 13 more legislative days left in the session, maybe the hospitals will find a new bad guy to replace them on the hot seat.

(Walter Jones is the Atlanta bureau chief for Morris News. He can be reached at (404) 589-8424 or )

Web posted on Thursday, March 18, 2010

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