Legislative update

May 7, 2010

Health Care Costs
Tremendous progress has been made on SB 505, establishing the commission on health care cost containment, since its introduction in January as a draconian effort to mandate hospital rate setting for all private payers. The House of Representatives further amended the bill which is now on its way back to the Senate for concurrence. SB 505 calls for the creation of a Health Care Cost Containment Commission to study New Hampshire’s health care payment system and recommend cost containment measures. Thanks to hospitals’ grassroots activity, senators were convinced that rate setting is not a solution to the rising cost of health care.
Members to be appointed to the Commission include legislators, representatives of the Citizens Health Initiative, Department of HHS, Insurance Department, experts in health care policy and health care economics, as well as a consumer representative. The Commission must begin to meet no later than September 1, 2010 and complete its work by July 2, 2012.

NHHA will closely monitor the work of the Commission.

On another front, the House Commerce Committee has recommended passage of its version of SB 392, requiring public hearings concerning health care cost increases in health care services and relative to hospital billing for services to uninsured patients. Significant improvements have been made to SB 392 to ensure that the intent of the bill is to examine health insurance premium increases, not health provider costs. These include:

- the removal of language “compelling” health providers to give information or documents to the Insurance Department. Instead, providers may be “invited” to provide relevant information. We fought hard to ensure that the Insurance Commissioner will have no authority over hospitals.

- clarification on billing limits for uninsured patients.. NHHA recommended that this section of the bill mirror the recently enacted federal health reform mandate that hospitals bill uninsured patients “the amount generally billed to health carriers” in a manner consistent with the Patient Protection and Affordable Care Act of 2009. This will ensure that whatever is required by the State of New Hampshire is based on federal rules.
 

Medicaid and the State Budget
House budget writers endorsed state spending cuts and new revenue sources in their version of SB 450, designed to deal with the state’s projected $220 million deficit through June 30, 2011. By a slim majority of 13-12, the House Finance Committee is recommending measures to save $182 million that includes $37 million in spending cuts, $40 million in debt restructuring,
$25 million in deferred maintenance for the University System of NH, a $16 million insurance premium tax; $4.5 million electricity generation tax; $10 million estate tax; and a $15 million reduction in distributions to cities and towns.

Next Steps: approval next week by the full House of Representatives; appointment of a Committee of Conference to iron out differences between the House and Senate versions of the bill, further approval by the House and Senate, and finally, action by the Governor – sign the bill, veto the bill or let it become law without his signature.

This budget package includes the following Medicaid hospital payment reductions. There were no additional surprises for hospital providers in the last round of deliberations by the House Finance Committee. The cuts listed below are shown as State and Federal funds combined:

- Hospital Outpatient Services: service limit reduced from 12 to 6 visits/yr: $ 700,000
- Indirect Graduate Medical Education: suspended April 1, 2010 – June 30, 201 2,800,000
- Direct Graduate Medical Education: extends the suspension until July 1, 2011 action taken HB 1
- Catastrophic Aid Payments: suspended June 15, 2010 - June 30, 2011 3,800,000
- Professional rate reductions from 80% to 60% of Medicare. 3,900,000
  This impacts hospitals and other providers
Also,
- Boston Children’s Hospital; rates reduced from 80% to 70% of cost: 1,500,000
The House Finance Committee rejected a proposal requiring the distribution of JUA funds to policy holders, including a proposal to distribute $25 million to the state’s general fund.

April 14, 2010

Health Care Costs
The House Commerce Committee voted yesterday in favor of its version of SB 505, establishing the commission on health care cost containment and appropriating a special fund, which is headed to the full House for a vote next week. SB 505 has come a very long way since it was introduced in January and is an improvement over the version passed by the Senate last month.

Summary of SB 505 as amended by the House Commerce Committee:

Subpoena power: We’re very pleased that the Commission’s subpoena power has been removed from the bill. Instead, the Commission can “solicit” relevant information from insurers, hospitals, ASCs, and other health care providers.

Commission Membership: Commission membership will be from 7 to 11 members adding two legislators of the minority party, a health economist, and a representative of small business. The Commission will elect its Chair. Legislators removed the provision designating the Citizens Health Initiative representative as Chair of the Commission.

Duties: Although the bill doesn’t specifically call for a broader focus of review, the charge to the Commission includes review of “health care services” and “health care payments” which can be interpreted more broadly than just hospitals. Examination of the impact of subsidization by hospitals of other health care entities has been added to the Commission’s duties.

Federal Health Reform: The amendment provides considerably more emphasis on consideration and impact of federal health reform on NH’s health care system.

Report: The reporting date has been extended to July 1, 2012 from November 1, 2011.

Following next week’s vote in the House, SB 505 will be referred to the House Ways & Means Committee for another hearing to focus on funding the Commission with fees collected from hospitals, ambulatory surgical facilities and health insurance carriers. The bill will return to the House floor for a second vote, and sent back to the Senate for concurrence. If the Senate does not concur, it can request a committee of conference where the differences between the House and Senate versions will be negotiated.

House Commerce Committee work sessions commence tomorrow, April 15th, on SB 392, requiring public hearings concerning health care cost increases in health care services and relative to hospital billing for services to uninsured patients. NHHA opposes passage of SB 392 now that the Legislature is creating the SB 505 Health Care Cost Containment Commission which will accomplish the same purposes proposed in SB 392.

In particular, we object to the provision allowing the Insurance Commissioner to “compel” health care providers to provide information and to testify at a public hearing. There’s no rationale stated as to what type of information hospitals and payers would be required to submit. SB 392 oversteps the authority of the Department of HHS to regulate hospitals.

The bill contains a provision related to limits on what uninsured patients will be charged by hospitals. This requirement should be eliminated in light of the recently enacted federal health reform legislation that limits what hospitals can charge patients who qualify for charity care.

Medicaid and the State Budget

Earlier this week the Joint Legislative Fiscal Committee approved the Governor’s plan to reduce SFY 2010 general fund spending by $25 million. On Thursday, April 15th, a proposal to cut SFY 2011 appropriations by another $60 million will be the subject of a hearing before the House and Senate Finance Committees to deal with the State’s $220 million shortfall.

There are no Medicaid hospital cuts planned for the remainder of SFY 2010, since professional rate reductions of $412,000 were removed from the initial proposal. However, Boston Children’s Hospital’s rates will be reduced by $250,000.

Proposed FY 2011 Medicaid hospital cuts include:

• Hospital Outpatient Services service limit reduction from 12 to 6 visits/year: $700,000
• Professional rate reductions from 80% to 60% of Medicare: $3,900,000
• Boston Children’s Hospital rate reduction: $1,500,000

The remainder of HHS budget reductions brings the total cuts to health and human services programs to $13.7 million in general funds ($16 million in total funds.) Other programs affected are New Hampshire Hospital, developmental disabilities services, substance abuse treatment, Dartmouth contracts for NHH, Medicaid, and Juvenile Services, nursing homes and community-based long term care programs.

 

NHHA’s complete list of bills is available here.