Audit: LSU Hospital Layoffs Would Cost State $42M

As Baton Rouge-based Louisiana State University Health Care Services Division prepares to privatize its public hospitals, the state is expected to incur millions in losses associated with the resulting layoffs, according to an audit from the office of Louisiana Legislative Auditor Daryl Purpera.

LSU is expected to have to pay $42 million in one-time layoff costs: $29 million in termination pay associated with privatization and $13 million related to unemployment costs. In addition, the audit estimates LSU will have to pay $26 million every year to cover health and life insurance policies.

In total, the report estimates that almost 5,300, or 91 percent, of LSU Health Care Services Division employees will be laid off under the plan. Roughly 1,800 LSU hospital employees have lost their jobs in the past three years alone.

According to the audit, Louisiana's Department of Health and Hospitals is aware of the layoff figures and associated costs and is "working to find a mechanism to fund" those expenses.

LSU Health Care Services Division includes seven acute-care hospitals, and six of those seven have been or will be affected by the state's highly publicized privatization plan: Earl K. Long Medical Center in Baton Rouge already closed in April; Medical Center of Louisiana in New Orleans, University Medical Center in Lafayette, Leonard J. Chabert Medical Center in Houma and Walter O. Moss Regional Medical Center in Lake Charles are all expected to be leased to separate private partners by June; and Bogalusa Medical Center is expected to be leased to a private partner, though no date has been announced yet.

More Articles on LSU Hospitals:

LSU Board Approves Leasing 2 Hospitals to Private Operators
Louisiana Can Privatize Hospitals Without Legislators' Approval, State AG Says
Louisiana Children's Could Take Over LSU Public Hospital by June

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