MHA Criticizes MassHealth Changes In State Budget
The Massachusetts Hospital Association (MHA) has voiced its displeasure with the budget that Gov. Deval Patrick signed on Sunday, which counts on $700 million in health care cost savings to achieve a balance.
Part of those cuts come from what the Patrick administration called "innovative management and contracting strategies at MassHealth aimed at lowering cost and transforming the payment and delivery models in the program."
MHA points toward four administrative changes that will it said will result in an estimated $40 million in cuts to hospitals, calling for Patrick to "take immediate administrative action to forestall the implementation" of what the group calls terms "unsound" policy.
"When we ... put people to work, reduce health care costs and strengthen public safety, we make Massachusetts better," Patrick said in a statement. "This budget does that through targeted investments and cost-savings reforms. This balanced approach keeps us on track to meet our generational responsibility of building a stronger commonwealth."
In a letter to the governor, MHA President and CEO Lynn Nicholas wrote that the policies "seem more driven by budget concerns than policy concerns and reflect a near total disregard for the legitimate concerns of providers."
She continued that they are "a direct illustration of the types of payment practices that have led to a high level of provider dissatisfaction and frustration with MassHealth. These payment reductions represent the continued practice of shifting of government costs onto providers."
The four areas MHA is concerned with are policies that deal with the following.
- Case mix: Hospitals would be prohibited from pursuing corrections to the formula used to determine future reimbursements, based on the types of patients and cases at a facility, unless the correction would produce at least a 30 percent change. Currently, there is no threshold for corrections.
- Readmissions: The state will double the financial penalty on hospitals that it has determined as having higher than expected re-admission rates.
- Outpatient reimbursement: MassHealth will not pay for an outpatient visit if it is followed by an inpatient stay at the same hospital within three days, even if the medical situations are unrelated.
- Capital costs: Hospital inpatient payments by MassHealth for capital costs such as facilities and equipment will be reduced by 30 percent.
"As hospitals have worked diligently to care for the 300,000 additional enrollees in MassHealth pursuant to the commonwealth's reform effort, the reduction in government payment for this care has made the work of hospitals even more difficult to perform and sustain over time," Nicholas wrote.
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