By Joseph Edelen

DOVER — As the highly debated bill to implement a Delaware hospital cost review board was considered by the Senate Executive Committee on Tuesday, Senate Majority Leader Bryan Townsend announced a new development in negotiations between lawmakers and health care stakeholders.

Under a separate proposal introduced in the House of Representatives on Tuesday, lawmakers are attempting to address a clause within House Substitute 2 for House Bill 350 that capped hospitals’ ability to charge more than 250% of Medicare’s cost for services.

The measure — House Bill 395, sponsored by House Majority Whip Kerri Evelyn Harris, D-Dover — would mandate that, for services, hospitals cannot charge more than the core regional Consumer Price Index, plus one point. The region includes Wilmington, Philadelphia and Camden, New Jersey.

The Delaware Healthcare Association — which represents a collective of Delaware hospitals, health systems and related health care organizations — has pushed back on this part of House Bill 350, as president and CEO Brian Frazee has mentioned it would cost the state’s non-profit hospitals more than $360 million.

The association and leadership from its member hospitals have sounded an alarm on the fiscal impacts of the bill, noting that it would lead to slashes in services, the hospital workforce, community programs and health care quality and access.

During the committee hearing, Sen. Townsend, D-Newark, noted that conversations have happened and will continue on the legislation, but that it was also important to consider House Bill 395 because it stemmed from negotiations between lawmakers and stakeholders.

“We heard very much people’s concerns, and making any changes to immediate years’ (hospital) budgets … could come with impacts, including on jobs,” Sen. Townsend said.

“And so, although there’s a very fair policy debate about whether or not, moving forward, (that) hospitals should be able to continue to be at the higher price point they have right now, there’s been a decision among the bill sponsors ... to advance a provision that would remove that (Medicare) reference pricing; remove the source of what we’re being told by hospitals was the driver of any job losses.”

Hospital leaders continued to testify against House Bill 350 during the legislation’s lengthy public comment period of Tuesday’s Senate Executive Committee hearing, which was cut down to one minute per person due to its lengthy debate and to hear from the dozens of individuals who signed up to speak.

This included Bayhealth president and CEO Terry Murphy, ChristianaCare president and CEO Janice Nevin and Mark Marcantano, president of Nemours Children’s Health; which would essentially be exempt from House Bill 350’s Medicare clause through the changes addressed under House Bill 395.

“(There’s been) lots of conciliatory sounding words; a statement around ‘this isn’t meant to be an attack on health care institutions,’ but there are some words here that sound rough when you think about language, process, timeline,” Mr. Marcantano said.

“There are lots of things that could be taken care of, might be taken care of; we’re looking at the language of the bill… artificial price cap, politically appointed board stepping in the shoes of leadership and governance, flawed benchmark that doesn’t get to controllable hospital operating costs, seizure of assets; that looks like an attack to us.”

Though hospitals’ leadership, their employees and the Delaware Healthcare Association have continued to oppose House Bill 350, the legislation’s sponsors — Speaker of the House Valerie Longhurst, D-Bear, and Sen. Townsend — reiterated their commitment to the proposal’s passage in a statement following Tuesday’s meeting.

While acknowledging the introduction of House Bill 395, the Democratic leaders stated that Delawareans are paying more on health care than residents of nearly every other state, while “often getting substandard outcomes.”

“None of the fearmongering or threats we have heard from the Delaware Healthcare Association over the last month will change that fact. Neither will inaction by the Delaware General Assembly. We must take the steps Delawareans need and deserve,” Speaker Longhurst and Sen. Townsend said in part.

“This is only the latest in a series of responsible compromises that legislative sponsors have incorporated into (House Substitute 2 for House Bill 350), which underwent three revisions in the House after being introduced in March. The bill now would give hospitals multiple opportunities over the course of several years to achieve reasonable prices before any sanctions are even considered.

“We have and will continue to engage with Delaware’s hospitals on a daily basis as we work to ensure that more profits generated from providing health care to Delawareans are being spent on keeping Delawareans healthy.”

In the statement, Speaker Longhurst and Sen. Townsend said the bill would be released from committee on Wednesday and likely undergo its final step in the legislative process later this month when the proposal is considered by the full Senate.

Prior to the legislation’s consideration in the Senate Executive Committee, more than 25 health care-related organizations and dozens of Delaware community leaders signed on to a joint letter sent to members of the General Assembly and Gov. John Carney in opposition of House Bill 350.

Those who signed on to the letter committed to working together with state leaders and stakeholders to find a solution to Delaware’s rising health care costs, but stated that, in its current form, House Bill 350 is not the way to achieve that goal, and that it would have “disastrous ramifications on not just the hospital systems, but on the business and nonprofit communities.”