Jindal made a series of budget reductions in mid-December to help close a nearly $166 million deficit in the current fiscal year that ends June 30. Many of the cuts fell on the Department of Health and Hospitals.
Greenstein said when cuts are required to the Medicaid program, only a few optional benefits can be reduced without violating requirements for the state's participation in the program it runs with the federal government. Hospice is an optional program the health department said has been available since 2002.
By using the grant funding, DHH will keep the program running while still saving $1.1 million in state funding this year and an estimated $3.1 million in state funding for the 2013-14 budget year.
The health department intends to make changes to the hospice services to shrink the costs of the care and improve the program, Greenstein said.
"Just turning it back on didn't make sense," he said. "This is going to be something that we're proud of because this going to be more efficient and effective."
More than 5,800 people received hospice services through Louisiana's Medicaid program in the last budget year, according to the health department. Many of those, however, were eligible to receive the end-of-life care through Medicare. About 1,400 received the services in their homes and wouldn't have been eligible through Medicare.
Among the planned changes is a focus on community-based, at-home care, Greenstein said. Nursing home residents will not be eligible for hospice care through Medicaid, though most can get it through Medicare, he said.