NHHA LEGISLATIVE UPDATE


April 1, 2005

The Legislature is nearing “crossover” – the deadline for the House and Senate to send bills over to the other body. As such, legislators had a full plate this week to cast their votes on dozens of bills. The following highlights bills important to hospitals.

STATE BUDGET – LEGISLATORS ASKED TO RESTORE MEDICAID CUTS

Hospitals and other Medicaid providers and the patients they serve turned out this week to testify in opposition to proposed cuts in the Medicaid Program. The House Finance Committee heard overwhelming testimony that the DHHS cuts were unacceptable. Governor Lynch was the first to testify objecting to the $200 million reductions made by House budget writers. The Finance Committee is constrained by the low revenue forecast of the House Ways & Means Committee. Work on the budget will continue in the House until April 20th when it will be sent to the Senate.

Testifying on behalf of hospitals were Russ Keene of Androscoggin Valley Hospital, Dick Showalter of Dartmouth-Hitchcock, and Leslie Melby of NHHA. View their testimony summarized below.

Cuts to hospitals add up to $34.5 million over the next two years. Currently hospitals receive only about 68 cents for each dollar of actual cost they incur overall providing care for Medicaid patients. These unsustainable cuts include:

· Medicaid Outpatient Hospital Payment Cuts: $17.5 million
Medicaid currently pays substantially less than what it costs to provide care. The reduction to 80% of allowable costs would be difficult for many hospitals to sustain, especially small hospitals and hospitals with a disproportionately large share of Medicaid enrollees in their service area.

· Medicaid Catastrophic Payment Cuts: $5 million
If your hospital receives Medicaid catastrophic payments, tell your legislator that this cut penalizes your hospital simply because you treat the sickest patients. If you rely on the larger hospitals to refer your sickest patients, tell your legislator that these patients will be more difficult to transfer to other facilities better equipped to provide the care they need.

· Medicaid Medical Education Payment Cuts: $6 million
Medical education payments contribute to covering the cost of physician care provided in teaching hospitals and other settings, including certain Community Health Centers. Every community hospital depends on being able to refer Medicaid patients and other patients for care that’s not available locally. The state Medicaid program has always recognized its obligation to recognize the actual value of care provided by physicians in residency programs that treat Medicaid patients, and pay at least some minimal share of the cost of that care. Abandoning that practice will further constrain the systems capacity to provide for all patients.

· Medicaid Capital Passthrough Payments: $6 million.
Medicaid and Medicare have long recognized the cost of medical equipment, technology and other capital costs as part of the overall cost of providing care. Payment for a share of hospital's capital costs were suspended last year, but were to be restored in this budget. But there is no provision for contributing to capital costs.


GRANITECARE - MEDICAID

HB 691, GraniteCare Long Term Care
The House narrowly passed one of two Medicaid “GraniteCare” bills. HB 691 is intended to steer patients who need long term care to community-based services instead of nursing homes. To stem the rising cost of nursing home care, the state would more closely scrutinize those Medicaid patients applying for admission to nursing homes. While considered to provide seniors with increased choices for community services, unless the availability of services are expanded sufficiently to meet the demand, patients may not have access to community services, and may therefore not be able to be discharged from the hospital.

The bill also extends the so-called “look back” period for asset transfer from 3-5 years to 5-10 years, thereby making it more difficult for people to pass on their assets to their relatives in order to qualify themselves for Medicaid. HB 691 will next be reviewed by the House Finance Committee.


MEDICAL LIABILITY

The Senate defeated two bills that would have made it easier to bring lawsuits:
SB 47, definition of party or parties for the apportionment of fault in civil litigation
This bill would change the law regarding joint defendants. In most situations in which there are multiple people responsible for an injury, current law apportions liability for payment according to each person’s fault. SB 47 would have made it more likely that defendants would pay more than their percentage of fault. The defendant with the deepest pocket, not the one most at fault, could end up paying the lion's share of the judgment. Under current law, plaintiffs are compensated for their injuries, and defendants pay for the damage they case – no more, no less.

SB 139, relative to admission into evidence of certain medical bills, reports and records. This bill would have shifted the burden of producing relevant medical evidence from plaintiffs to defendants, as well as increase defense costs which would be reflected in increased insurance premiums. It would have made admissible all kinds of medical records that currently must be brought in through a witness or by agreement. Currently, parties work out these issues regarding what records and reports will be admitted.

Pre-trial Screening Panels
Meanwhile, the House passed HB 702-FN, requiring pretrial screening of medical malpractice claims. This is one of two bills that require the creation of pretrial screening panels. NHHA supports SB214, which would require all medical malpractice cases go before a three- person panel: a retired judge, an attorney and a health care practitioner. The purpose of review panels is to reduce medical injury system costs by promptly identifying and resolving both meritorious and non-meritorious claims. Unanimous decisions by the panel are admissible in any future trial. Pretrial screening panels are needed in New Hampshire to reduce the rate of increase in the cost of malpractice premiums. In Maine where pretrial screening panels are in place, the malpractice premium insurance rates are 40 – 50% less than the rates for hospitals and physicians in New Hampshire. The panel under HB 702 is made up of a judge to determine if the medical claim has merit. Regardless of the judge’s finding, the case that proceeds to trial must be subject to mediation. If the case goes to trial, the panel judge’s finding would not admissible at trial.

The Senate Judiciary Committee is scheduled to vote on SB 214 on Tuesday, April 5th

I’m Sorry Legislation
The House weighed in on two bills that would make certain statements made by providers to a patient inadmissible as evidence in a medical injury action. HB 463, Evidence of Admissions in Medical Injury Actions, was defeated. This bill would have permitted expressions of apology, fault, sympathy, condolence, or compassion that relate to the discomfort, pain, suffering, injury or death as the result of an unanticipated outcome of medical care. In states where statements of sympathy are inadmissible, fewer lawsuits have been brought because the incidents are recognized and the patient’s incurred expenses are reimbursed. This bill would encourage quicker payment of settlements.

The House favored HB 584, Evidence of Admissions of Liability in Medical Injury Cases, which though similar to HB 463, does not apply to a statement of fault, negligence, or culpable conduct.

Limits on Non-Economic Damages
The House killed HB 496, relative to limits on non-economic damages in medical injury actions. This bill would have placed a cap of $250,000 on non-economic damages. Legislators felt that this legislation would be in violation of the State constitution, and that such a cap would do little to reduce medical malpractice insurance premiums.


SMALL GROUP HEALTH INSURANCE – SB 110 REFORM

The House passed HB 611-FN, relative to small group insurers. This bill is one of many small group insurance reform bills. It eliminates health status and geographic rating, establishes a reinsurance mechanism, creates a composite band of case characteristics used to establish premiums, sets a limit of 4:1 variability on premium rates, and establishes a 15% cap on premium rate increases, excluding trend. Additionally, the amendment extends the responsibility of the SB 110 oversight committee to monitoring the effects of small group health insurance reform.

Another SB 110 reform bill is working its way through the Senate: SB 125, repealing health status and geographic location as small group rating factors and establishing a reinsurance mechanism, is endorsed by the Governor and a majority of Senators. This bill also eliminates health status and geographic rating for small employer group health insurance and creates a small employer health reinsurance pool for employees with medical problems.


HEALTH CARE INFORMATION

HB 383 - Vital Records Administration
The House passed HB 383 which codifies the Vital Records administrative rules into statute. The Secretary of State and the Department of Health & Human Services will adopt a memorandum of understanding (MOU) to address the role of each agency in maintaining the State’s vital records system. The bill specifies the process of handling requests for data for health related research as well as the process for adding or removing data fields. The bill also changes the retention of a natural fetal death record from one year to permanently.




Go to http://www.nhha.org/nhha/state_law/bills.php to view the list of bills NHHA will be tracking in 2005.  Additional bills will be added as we become aware of them.

Click Here for the NH House and Senate Web Site