Governor Kathleen Babineaux Blanco today announced that the U.S. Department of Health and Human Services (HHS) has awarded $161 million to Louisiana to improve health care in areas affected by Hurricane Katrina.

"We welcome this additional funding from HHS as we continue rebuilding the health care delivery system in the New Orleans area," Governor Blanco said. "This afternoon, I personally thanked HHS Secretary Michael Leavitt for his assistance with our recovery. This grant money will complement what I have proposed in our state health care budget to expand access to primary and preventive care and recruit and retain our medical workforce."

Gov. Blanco said the proposed state budget for next year includes more than $320 million in enhancements to the health care delivery system statewide. The new money will support the development of medical homes in Louisiana, expand insurance coverage for children through the Louisiana Children's Health Insurance Program, increase the reimbursements paid to physicians to help recruit more doctors into the Medicaid program, expand services to people with disabilities and mental illnesses and allow more families to purchase insurance coverage through Medicaid. Another $120 million is budgeted for an uncompensated care pool to reimburse hospitals for caring for more uninsured.

Of the $195 million in federal HHS grants, $100 million will be allocated to Louisiana for public and not-for-profit clinics that provide primary care to low-income and uninsured residents in the Greater New Orleans area. There is $35 million included in the grant for Louisiana to use to assist the Greater New Orleans area in recruiting and retaining health care workers.

Department of Health and Hospitals Secretary Dr. Fred Cerise said LDH will immediately begin work to identify possible local partners as described in the federal guidance to manage the primary care component of the grant.

“Prior to Hurricane Katrina, we proposed HealthPAC, a similar plan that focused on primary and preventive care, to the federal government. Last year the Redesign Collaborative recommended a medical home system of care which was also founded on core primary and preventive services for the citizens of New Orleans,” Cerise added. “Today's grant from the federal government is very consistent with the earlier efforts by Governor Blanco’s administration to establish a network of community clinics to provide a continuum of care for our uninsured and Medicaid patients.”

This new grant follows earlier appeals to the federal government. The administration's successful efforts to secure past funding includes a grant to recruit physicians to New Orleans, funding that will allow providers to receive greater reimbursements from Medicare and funds to provide more addiction treatment clinics and crisis counseling services.