Tuesday, June 24, 2014

Oh boy, $3.3 million

From the first paragraph in a report in the Boston Globe:

Partners HealthCare System has agreed to pay $3.3 million to cover the cost of the state’s five-year investigation into its market power, and for a court-appointed monitor to scrutinize its actions for the next decade.

How does that pittance even justify being put as the lede in the story? And why wasn't it put into some kind of financial context?  Like this:

According to its audited financial report, PHS' revenue in 2013 was $10 billion, producing revenues in excess of expenditures of $600 million.

So, the agreement produced a financial commitment of .01 percent of one year of the company's revenues, or .55% of one year's annual gain.

Meanwhile, the substance of the deal stays the same, according to the Globe:

The payments are detailed in a much-anticipated final agreement between the health care giant and Attorney General Martha Coakley filed in Suffolk Superior Court Tuesday. The “consent judgment’’ follows the outlines of a preliminary agreement reached by the two sides in May, allowing Partners to acquire South Shore Hospital in Weymouth and at least two other community hospitals, but restricting its further expansion and temporarily capping its prices.

Well, I admit to being totally wrong in a portion of  my prediction of June 12, when I said of the AG:

Watch for her to weasel out of this deal (or perhaps delay "finalization" until much later in the election cycle.)

But there is another part of that prediction that remains in a holding pattern:

This issue is big enough, in terms of the impact on the state economy for decades to come, to cost the AG the [gubernatorial] election.


Several from Facebook said...

From Facebook:

Norma Sandrock: When she does try to talk her way out of it, I'm sure she will use the word "transparency" in every sentence. (Did you see her on the news tonight saying she was "pleased" that the SJC ruled in favor of the vote against which she had fought so hard? Her handlers must have told her that is the buzzword everyone wants to hear. That plus "it's my job to do that.")

M Kashif Sheikh: Also seems from an outsiders view there is a conflict of interest when the organization being scrutinized is paying the cost of said scrutiny.

John Greenbaum: Wow Martha, strong hand on your control of a monopoly.

Beverly Heywood Rogers: Y'all have a real problem in MA, if you don't mind my saying.

Barry Carol said...

After looking at the financial report for 2013, I think it would be interesting to see how the contract reimbursement rates paid to Partners by its captive insurer compare to the rates Partners is able to extract from BCBSMA, Harvard-Pilgrim and other health insurers who do business in MA.

Paul Levy said...

Likely less, as it is mainly lower income subscribers, but worth a look.