Sausage making: Fast food version

Continuing my occasional series for out-of-state readers.

Even for Massachusetts, this is hard to keep up with. The leadership of the House of Representatives has issued a comprehensive bill that would introduce rate setting for payments from insurers to hospitals. The plan is to ask for a vote tomorrow.

Here's the summary from Jim O'Sullivan at the State House News Service:

STATE HOUSE, BOSTON, JULY 20, 2010……Health care cost control legislation the House expects to debate Wednesday would limit insurance premium hikes, curb the practice of convenience insurance purchases, and seek to spread premium increases over multiple years.

The House rewrite of Senate President Therese Murray’s proposal drops her plan to impose an assessment on large hospitals and ignores Gov. Deval Patrick’s effort to reopen provider contracts, which Patrick proposed in February as an offset to his “soft cap” on insurer rate hikes.

Authored by Assistant House Majority Leader Ronald Mariano, the House leadership draft authorizes the state’s Division of Health Care Finance and Policy to tax 50 percent of the savings in provider rates of reimbursement for deposit in a trust fund devoted to hospitals that provide a disproportionate share of care subsidized by the state, for which they receive lower reimbursement. The remaining proceeds would go toward premium savings for employers.

The bill also offers patients access to prescription drug discounts.

The Massachusetts Hospital Association offered this preliminary analysis to its members.

The House bill is extraordinarily complex and appears impossible to model. The bill proposes sweeping regulation of every hospital's rate of payment from every insurer, as well as numerous other new regulatory changes from Determination of Need to massively increased data reporting requirements. Without any public input or hearing process, in less than 48 hours, the House will be voting on an entire overhaul of the Commonwealth's healthcare regulatory system. Definitions and specifications are left to state regulators -- the impact of the bill is impossible to accurately predict.

Regular readers know that I am sympathetic to the idea of rate-setting. (Most of my colleagues are not.) And I also think it is important to reduce the differential paid to different hospitals for doing the same thing. But, I am also sympathetic to the idea of doing all this thoughtfully and correctly. It is hard to imagine how a bill that has traveled so quickly without public review and comment is likely to get it right.

But wait, maybe it is not meant to be adopted. Another excerpt from State House News:

Mariano has described the House bill a sort of conversation-starter for the 2011-2012 legislative session, for which the state will have either reelected Patrick or chosen another governor, and when at least 34 of the 200 legislative seats will have new occupants.