Why Should Delaware Care?
Health care spending in Delaware has increased faster than projections in each of the last three years, straining the budgets of households across the state. The industry is also facing a workforce shortage that is lengthening wait times for appointments statewide.
The battle over a groundbreaking, but controversial, state board tasked with reining in hospital prices in Delaware is continuing more than five months after Gov. John Carney signed into law the hard-fought legislation that created the public body.
The latest front in the battle features two opposing local lobbying forces – the Delaware Hospital Association and a coalition of public sector unions – who each have been pressuring Carney over whether he should or should not nominate members to the newly created state board.
If he doesn’t, the decision would likely be left to his successor, Governor-elect Matt Meyer, who last summer told Spotlight Delaware that the review board “alone is unlikely to significantly decrease the cost of health care for Delawareans.”
In a conversation with Spotlight Delaware on Wednesday, Delaware Hospital Association President Brian Frazee said Meyer has shown a willingness to make changes to the law that created the board – formally named the Diamond State Hospital Cost Review Board.
Frazee declined to reveal details of those potential changes. But he did state that among his group’s primary contentions is the review board’s legal authority under the new law to modify hospital budgets if certain costs are not brought down.
Frazee’s comments follow a letter he sent to Carney last week, in which he noted that the hospital Association had been holding discussions with Meyer’s team, as well as with certain unnamed lawmakers, about “potential modifications” to the law that created the hospital review board.
The letter followed a legal challenge to the constitutionality of the review board brought in July by ChristianaCare – Delaware’s largest hospital system and a member of the Delaware Hospital Association.
In the lawsuit, ChristianaCare’s attorneys argued, in part, that the imposition of hospital price caps – one tool that the review board could employ – is “unlawful and discriminatory.”
Frazee’s letter cited the pending lawsuit, as well as its ongoing discussions with the next governor, as the reason Carney should defer nominations to Meyer.
“Please avoid potential confusion and uncertainty by enabling the next administration, legislative leaders and the courts to resolve the critical issue before appointments are made to this board,” the letter stated.
The letter did not explicitly state any modifications to the board’s structure that the hospital association is seeking.
In conjunction with Frazee’s letter, the Delaware Hospital Association sent out a press release titled “DHA Opposes Lame-Duck Appointments to HB 350 Board.”
The statement bucked a longstanding Delaware Way practice by influential lobbies of resolving political disputes quietly and away from the public eye.
It also follows a massive failed lobbying effort from hospital boards and their administrators, who last spring flooded Dover wearing white coats in efforts to oppose House Bill 350, which created the board.
Lawmakers ultimately approved a substituted version of the bill that included certain concessions to hospitals, but otherwise largely mirrored the original intent of the legislation.
Unions respond
On Tuesday, in a response to Frazee’s letter, a coalition of public sector unions sent its own letter to Carney urging him to take what they called the “fundamental and basic step” of nominating members of the hospital cost review board.
They said the governor should do it “without delay” and not wait for hospitals to “exhaust every legal avenue.”
The coalition, called State Workers United, includes the state’s unions for teachers, Delaware State Police troopers, correctional officers and public sector employees. It was the largest supporter behind House Bill 350, arguing that the exploding cost of care was driving up costs for public sector employees and taxpayers as a result.
In the letter, the group also pointed to Delaware’s high health care costs and asserted that large portions of the state government’s budget “are being devoured by unchecked health care costs that continue to rise faster than the rate of inflation.”
“House Bill 350 marked the first step in our collective effort to bring this unsustainable cost spiral under control,” the union letter stated.
According to a report submitted in May to the Delaware Department of Health and Social Services, state health care spending has increased faster than projections in each of the last three years.
In a statement emailed to Spotlight Delaware, Carney spokeswoman Emily Hershman did not say whether the governor will nominate members to the board before the end of his term.
Instead, she noted that Carney had “called the Senate into a special session to consider nominations for appointments that require Senate confirmation.”
“Nominations will be made public when they are submitted to the Senate,” she said.
Frazee said it is his belief that “Carney fully intends to appoint members to the board.”
When pressed, Frazee said the Delaware Hospital Association doesn’t prefer Meyer over Carney as the overseer of the cost review board for political or ideological reasons, instead saying it’s a timing issue.
He said the review board will not be operational before Meyer’s term. He also asserted that nominees to the board should be first publicly vetted.
Nominees to other state-run oversight boards – such as the Diamond State Port Corporation – typically are not vetted publicly. Asked why the hospital board should be different, Frazee said it was because the hospital industry is the largest private sector employer in the state.
Members of Meyer’s transition team did not respond to emails sent by Spotlight Delaware on Tuesday or Wednesday ahead of the Thanksgiving holiday break.
Last summer, Meyer said in response to a Spotlight Delaware questionnaire sent to gubernatorial candidates that he believed “the oversight board alone is unlikely to significantly decrease the cost of health care” for Delaware.
He also stated that as governor he would like to create “a Prescription Drug Affordability Board” to control the prices of pharmaceuticals.
While the public sector unions and the hospitals are focused on Carney and Meyer, Delaware will have still another governor for a couple weeks in January.
Lt. Gov. Bethany Hall-Long – who fought a bitter primary election campaign against Meyer this year – will become governor for about a week in January. Her ascension to the top spot is the result of a peculiar shuffling of political chairs in Delaware, in which Carney will resign as governor to become the mayor of Wilmington, before Meyer’s swearing in as governor.
Carney’s resignation will trigger Hall-Long’s ascension as the state’s second highest elected official.
A spokeswoman for Hall-Long did not respond to requests on Tuesday and Wednesday about whether the lieutenant governor intends to address the hospital review board nominations during her stint as governor.
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