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Privatization deals leave schools stuck with 'legacy costs'

2 years 6 months 1 week ago Thursday, April 16 2015 Apr 16, 2015 April 16, 2015 2:14 PM April 16, 2015 in Health
Source: Associated Press
By: Melinda Deslatte

BATON ROUGE - LSU's medical schools in New Orleans and Shreveport are struggling to pay millions of dollars in insurance, retiree and maintenance costs left to them from the privatization of the state's charity hospitals.

University officials outlined more than $56 million in "legacy costs" that they face in the fiscal year that begins July 1.

Gov. Bobby Jindal's budget would leave the health sciences center in New Orleans and Shreveport to cover costs associated with former hospital employees, the Senate Finance Committee was told Thursday.

Millions of dollars in those costs are expected year after year, and medical school leaders say they've burned through cash reserves covering the expenses.

LSU health care chief Frank Opelka said if no money is provided to cover those costs, they will threaten the medical schools' viability.

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