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Hospital Intrusion is not a lifesaving infusion of capital for Delawareans

By: Ruth Briggs King, Board Member, A Better Delaware

For years I was the only member of the Delaware General Assembly with any medical education or experience. I brought my insight and ideas to improve the quality of care, access to care, and avoid unnecessary interference that is costly or unnecessary.

As a result of my experience, I am very concerned about S1(Substitute 1) for HB 350, now pending in the General Assembly. This misguided legislation purports to create control over the State’s health care costs. What it clearly demonstrates is that some State law makers have misdiagnosed the problems with existing health care costs in Delaware. They are proposing to try to control the finances of a complex entity and private, non-profit community hospital which, by any other unqualified individual, would be considered malpractice. This bill will create a chilling effect on quality and patient centered care in our State. I call on our legislators to consider the ramifications of HB 350 and to vote “No” on this bill.

First and most importantly, the legislation has misplaced the blame for increasing health care costs on the hospitals. This effort is clearly simply a look at the bottom line and not intended to address many other significant issues in the delivery of health care in Delaware.

A candid look at past performance demonstrates that the State cannot appropriately manage the health care services it currently seeks to deliver, and therefore should not, in any way, intrude into our private health care system. There has been much media coverage and internal discussion about the problems and woes in the State run hospitals, such as the home for the chronically il, the veteran’s home and the correctional facilities health care. Despite years of poor performance, the State has not fixed their own health care delivery problems.

Hospitals do not operate in a vacuum or an isolated environment. They are not immune to the impact of escalating energy costs; wage increase demands and government regulation imposed by multiple State and Federal agencies. Additionally, our hospitals provide emergency care at no cost to those who are uninsured. And we, the people who are served by these hospitals, expect the best care, the latest technology, and the best outcomes. This all comes at a cost.

The legislators are blind to the impact the very legislation they pass has on the cost of healthcare and, therefore, the hospital community. Delaware’s expanded Medicaid eligibility provisions have forced Delaware taxpayers to pay $20-30 million more each year for the last 4-5 years. At the same time, the Medicaid reimbursement to the hospitals, as well as long term care facilities, has not accelerated to cover the costs. For example, a small community hospital in Sussex County loses money on each Medicaid newborn delivery. And they lack the volume of deliveries to make it “balance” the cost. Should they stop delivering babies? No, in fact, the hospital voted to continue the service at significant loss. Will the State cover the “loss” on those services? No. The State expects the hospitals to do more with less and then is critical of their budgets.

Let us be specific. Hospitals have to plan for increased demand. They hold aside reserves in anticipation of future construction and equipment needs. Would the proposed legislation affect these, and other, capital budgets or simply operational budgets? And what happens when real-time operational decisions have to be made? How could this arrangement “manage” a 20-car pileup on I95, or, worse, a pandemic, such as COVID?

Our current hospital boards are, generally, well governed and represent the community in which they are located. The remedy for increasing healthcare costs is less government intrusion and for lawmakers to understand how their decisions impact the cost of care and services. Healthcare and hospitals are not in a cloistered environment that protects them from escalating costs.

Hospital boards face complex decisions and need skill and expertise to make the sophisticated analysis to develop a strategic plan to serve the community. They anticipate population growth and need. Our Sussex County community hospitals recently established residency programs to address the lack of supply and high demand for primary care physicians. Furthermore, it is the hospitals that have sought and funded consulting firms to discuss the need for a medical school in Delaware. The State’s medical resources, including at DHSS, are severely inadequate and rely on the professionals and the local community boards to be the driving force for superior health care. Why would legislators seek to cripple a system that is not on life support?

Did anyone consider that hospitals get bonds to fund their projects based on operational performance and balance sheets? Legislative interference would stifle a hospital’s ability to grow and demonstrate the need for bonds to invest in healthcare expansion when needed.

No one is mentioning the liability and potential detriment of care. The hospitals absorb the risk and liability resulting from poor decisions or inadequate care. Will the new Commission accept the risk if their approved budget affects the hospital’s ability to provide the care, they believe is necessary?

Further, consider the message and effect on health-related industries, such as pharma and biotechnology industries in Delaware. After all, who is next?

Healthcare is more than a balance sheet. Our hospitals are forward thinking and continually investing in current and emerging issues. Did the legislators listen to the healthcare industry or work with hospital leadership to develop a path forward? If not, beware. Government intervention in our hospitals’ budgets is a slippery slope that will require emergency intervention, and resuscitation at a far greater cost to Delawareans than, I believe, the legislature anticipates.

Ruth Briggs King just retired from the Delaware General Assembly, where she served the 37th District, and the State, since 2009. She has extensive experience in finance, banking and organizational development and owns Workforce Solutions Today, LLC with her business partner. She recently joined the Advisory Board of A Better Delaware.