Hospital deal pinches health information agency


BOSTON >> The outgoing head of the health care agency whose funding will be siphoned to pay for an accord over health care provider pricing is questioning the impact the deal would have on struggling community hospitals.

Center for Health and Information Analysis (CHIA) Executive Director Aron Boros also said Thursday that the redirection of funding from his agency to boost the bottom lines of hospitals around the state will limit CHIA's ability to deliver on a consumer website he has been working with Gov. Charlie Baker's administration to build for the past year.

"Our job is to look at hospital finances and understand hospital finances. That's a core part of our mission and we understand deeply the challenges faced by community hospitals," Boros told the News Service. "Given the scale of the financial challenges across the industry, $45 million over five years does not seem like it will make a significant difference in the long-run to the future of those hospitals."

Boros said he was not consulted by Beacon Hill leaders during the development of the compromise.

Massachusetts lawmakers on Thursday fast-tracked legislation codifying the high-dollar health care financing deal brokered Wednesday between the state's largest health care provider and the health care workers union behind a ballot campaign to restructure hospital payments.

Both the House and Senate passed the compromise bill just hours after Baker, along with legislative leaders, announced the deal that would reconstitute a commission charged with examining variations in pricing in the health care industry and direct $120 million over five years in financial relief to hospitals across the state.

1199 SEIU United Healthcare Workers East said it had agreed to drop its ballot question pending the successful passage of legislation.

The deal brokered behind the scenes by Beacon Hill leaders between the union and Partners HealthCare, which stood to lose as much as $450 million in payments under the terms of the ballot question, was intended to head off a costly and contentious ballot fight this summer and fall.

Sen. James Welch, the co-chair of the Health Care Financing Committee called the issue "far too critical to be put to a yes or no vote" on the ballot in November, and said the deal would "provide additional immediate relief to hospitals that have suffered from price variation."

Interest groups have long pressured lawmakers to address health care pricing disparities, but legislators have been unable to agree on a path forward. The ballot question appears to have forced their hand.

The special commission created under the bill, to be co-chaired by Welch and Rep. Jeffrey Sanchez, would have to start meeting by Sept. 15 and meet monthly after that before producing a final report with findings, policy recommendations and potential draft legislation no later than March 15, 2017.

"We need to tackle the issue of unwarranted hospital price variation in the commonwealth. This bill allows us to do that, by averting the ballot question, pricing immediate relief to hospitals in need and requiring the development of an actual policy recommendation next year, early next year," Welch said.

But before the Senate voted unanimously 39-0 in favor of the bill, Sen. Michael Barrett, of Lexington, lamented what he called "a gratuitous bit of violence" against CHIA.

"We are essentially gutting the Center for Health Information and Analysis," Barrett said, referring to an agency lawmakers empowered in 2012 as part of a major health care cost containment law.

Rather than redistributing money within the hospital industry as the ballot question would have done, the agreement authorizes $45 million over the next five years from existing assessments to be distributed to hospitals with relative prices below 120 percent of the statewide median.

The hospital funding would be redirected away from the Center for Health Information and Analysis, starting with $5 million in fiscal 2017 and $10 million a year thereafter. Secretary of Health and Human Services Marylou Sudders would also be authorized under the bill to expend up to $15 million a year in additional hospital reimbursement rates through MassHealth.

"This is significant collateral damage done to an innocent bystander, an entity that was doing the job we asked it to do. So while we have to get this question off the November ballot, we should recognize that for reasons not having to do with the Senate's choices this very destructive act directed at a watchdog agency that was keeping the executive branch honest - this very destructive act - is going down," Barrett said.

Barrett predicted an "exodus of talent" from CHIA as a result of the deal.

Boros, who announced in April that he would step down from CHIA on June 17, sad he shared some of Barrett's concerns.

"What I primarily worry about is the ability to attract and retain a high quality leader for CHIA in my transition and I think this will make that search more challenging. This will present huge challenges for whoever the next leader is," he said.

According to Boros, the $5 million reduction in CHIA's budget in fiscal 2017 would amount to a 12 percent cut based on the $27.95 million budget recommended by both Baker and the Senate. That reduction would grow to 31 percent in fiscal years 2018 through 2021.

"Obviously, that is a significant cut to the ability of CHIA to deliver on the vision laid out in Chapter 224 for the agency," Boros said. "This will be a significant change to our ability to collect health care data, make that data understandable for a variety of people and share that information with the public."

Boros said that among the projects in CHIA's "work plan" for fiscal 2017 was to continue work with the Baker administration on the development of a website that would make information on health care cost and quality more readily available to the consumers.

Given the budgets cuts that will have to be absorbed as a result of the Partners-SEIU deal and the fact that money has not yet been committed to the project, he said CHIA would be "less likely to pursue that work."

Attorney General Maura Healey, who is traveling in Israel, but has been engaged in the provider price variation issue, also raised concerns about the cuts to CHIA.

"We have concerns about the significant budget cut to CHIA and what that means for our ability to continue to make informed, data-driven health care policy. We look forward to working with the Administration, legislative leaders and health care stakeholders to find a long-term solution to the price disparity problem," Healey spokeswoman Cyndi Roy Gonzalez said in a statement.

Retailers Association of Massachusetts President Jon Hurst said in a statement that he agreed with the need to avoid a ballot question, but worried the deal could be "kicking the can down the road" and urged a more "real resolution to the provider healthcare cost disparity problem" soon.

"The fact that the sponsors of the initiative are not going forward may indicate that costs and payment disparities were not the objective at all, rather further healthcare facility unionization. We must keep focused on the fact that costs cannot come down as long as we have a combination of excessive payrolls, and out of step reimbursement rates," Hurst said.


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