From Transparency to Quality: A Better Path for Delaware’s Health

By: Jane Brady, Chair, A Better Delaware

This is the first in a series of articles that will take a look at how the policy principles and legislative priorities of A Better Delaware fared in the last legislative session, which ended on June 30.  We have written over several years now about our perspective on healthcare, education, energy, the economy and workforce in Delaware, as well as the need for more accountability and better transparency in the way government works in Delaware. 

In this series, we will look at how the action the legislature took promotes or inhibits achievement of those policy objectives we feel are important to make Delaware a better place for families, workers, businesses and the community at large.

Healthcare Policy

Our principles at A Better Delaware regarding healthcare include promoting more competition, assuring better billing transparency and eliminating the obstacles to quality of care and lower costs.

The primary healthcare focus of the General Assembly and the Carney administration in this past legislative session was the cost to the State. Two primary initiatives addressed the state’s cost to provide health care to employees and retirees.

The first was HB 350, which placed a panel of 5 persons, selected through a political process, in a position of oversight of hospital budgets. While initially opposed by every hospital in the state, ultimately, the bill was amended slightly, and the hospitals were silent. The bill passed.

There are serious issues with this approach. The impact of a legislature prepared to put a political panel in charge of finance decisions in a private or non-profit business cannot be understated. During session, legislators were discussing what other businesses contract with the state and whether a financial review of their profits and spending choices might be appropriate.  Imagine a builder bids on a project and a panel of political appointees ask, “This price is awful high. How much compensation did you take home last year?”

The Governor was squarely behind this bill but should have appreciated the chilling effect this will have on new businesses locating in Delaware. And, when over a third of our revenue depends on our corporate friendly business climate, that impact can affect all of state services.

The second issue was the initiative to thwart the Governor’s plan to move retirees to a Medicare Advantage Plan from the current state health care plan.  There was a loud and effective resistance, and the General Assembly responded with a bill to prevent such a move. The Governor vetoed the bill, and in a rare, bi-partisan moment, the General Assembly voted to override the veto.

There are real shortcomings to the State’s approach to health care costs.  Rather than take an overall perspective of what procedures the state is covering, what contributions the insured are making, and whether those contributions are fair and comparable to what privately insured individuals pay as a portion of their premiums to employer plans for instance, Governor Carney determined to use a sledgehammer on hospital budgets and force retirees into an alternative plan to the one the state already provided

There are so many options the Administration did not advance or consider. First, pass along increases in health care as they occur. State insured individuals have never paid comparably to private employees. Everyone knows costs go up, and expects to pay more for healthcare, like every other commodity. Waiting until there is a dire need and imposing a huge increase all at once is not responsible management.

Second, remove the need for a certificate of need (now called a Certificate of Public Review in Delaware), which studies have repeatedly shown increase the costs of, and limit access to, health care.  That law requires that some of the very people who provide health care services in Delaware approve new facilities and services by their competitors. Why wouldn’t that restrict competition and limit options? The result?  The very same procedures can cost 30% less in neighboring states, that have competition.

The State should enforce and expand the laws we already have in place requiring transparency in billing and allow for patients to choose who provides their MRI, knee replacement or heart surgery. Costs vary widely between providers right here in Delaware, but patients cannot easily find the costs. It is expected, if you buy a couch or beef roast, that you will know the cost before you seal the deal. But you don’t know what a procedure will cost you before you undergo it. That does not make sense, particularly when there are differences in price between qualified providers.  The State could cut health care costs by providing that information to its insureds.

Finally, the State should take responsibility for the choices it makes regarding what procedures to cover, and for what amount.  At the very same hearing at which nearly $700,000 was appropriated for the costs of establishing the hospital budget review panel, the Committee voted to expand coverage to include all abortion and related services and to eliminate all copays for all such services, thereby increasing, in one vote, the costs to the state for health care insurance. Without comment on the subject that was covered, the reality is that you cannot continue to expand coverage without increasing costs, yet they did not, while in the same breath, blaming the hospitals for the high costs to the state for health care.

Jane Brady serves as Chair of A Better Delaware. She previously served as Attorney General of Delaware and as a Judge of the Delaware Superior Court.