Gov. Haley Barbour unveiled a new plan late Friday to fill a hole in the state Medicaid budget by shuffling existing assessments on hospitals.
The new plan allows him to bypass the state Legislature. Barbour and House leaders had been unable to reach an agreement for nearly two months on how to fill the $90 million shortfall.
The Republican governor had wanted to increase certain hospital taxes. Democratic House leaders wanted an increase in tobacco taxes to be part of the deal. The result was a politically charged stalemate with each side accusing the other of refusing to budge.
Barbour said his new solution would generate $88 million of the $90 million shortfall by increasing the gross revenue assessment on hospitals, which Medicaid can do without Legislative approval. The other $2 million would be generated through cuts of less than 1 percent on other provider services, Barbour said in a news release announcing the plan.
The Legislature can be bypassed because Medicaid is allowed to adjust the gross revenue assessment under state law because it is already in place.