Why Should Delaware Care?
Since its inception, a Delaware regulatory board responsible for lowering hospital spending has been under threat. Now, amid settlement talks in a lawsuit challenging the board’s authority, members voted to stop their meetings until those discussions are resolved.
As the state negotiates with its largest health care provider over the future of a regulatory board meant to curb excessive hospital spending, members of that board voted Tuesday to halt future meetings until those discussions are complete.
It comes less than a week after Gov. Matt Meyer announced a pause to an ongoing lawsuit between ChristianaCare, Delaware’s largest and most influential hospital, and the state government.
As part of the pause, Delaware lawmakers must remove the Diamond State Hospital Cost Review Board’s key enforcement ability to modify and veto hospital budgets it deems excessive. If the state fails to enact legislation before the end of January 2026, the lawsuit may continue.
At a board meeting on Tuesday, members voted unanimously after a closed-door session with attorneys to pause its meetings until after that deadline. David Singleton, chair of the cost review board, said in an interview that members received an “extensive briefing” on the state of potential legislation and the settlement talks.
Additionally, he said there was “no immediate need for meetings” while the process was ongoing. However, Singleton left the door open for meetings should there be any developments surrounding legislation.
A spokesperson for Meyer’s office had no comment on the move to pause the meetings when asked by Spotlight Delaware on Tuesday afternoon.
The pauses in both the lawsuit and board’s activities add focus to how legislators will respond to ChristianaCare’s demands to change the law which created the board.
If all the proposed changes to the review board pass the legislature, they could water down its ability to regulate hospitals and gain public insights into the inner-workings of Delaware’s health care system.
The board would retroactively review financial and operational information submitted by hospital systems – some of which is already publicly available from their tax filings, and some that is currently private like service utilization rates – but would no longer be able to modify or veto hospital budgets.
The hospitals would be required to demonstrate efforts to reduce costs to consumers, but the board would have little ability to hold health care providers accountable to those efforts. The board could apply $500,000 sanctions on a hospital, but only if it fails to submit the required reports.
The governor’s office denied the board’s effectiveness would be impacted by any of the proposed regulatory changes.
The agreement says if the state does not introduce legislative amendments by Jan. 13 – the first day of the 2026 legislative session – and have them approved by Jan. 31, the lawsuit would continue. The governor’s office said it thinks those deadlines are realistic.
How did we get here?
In 2024, the Delaware legislature passed House Bill 350, which established the Diamond State Hospital Cost Review Board. The law would later be signed by former Gov. John Carney.
The board was tasked with reducing hospital spending in Delaware, and given the power to veto hospital budgets it deemed excessive. It was modeled after a similar board in use in Vermont, which advocates support but hospital systems despise.
Prior to HB 350’s passing, the Delaware’s hospital systems blitzed the statehouse, attempting to lobby lawmakers against the bill. Ultimately, that effort failed, and hospital leaders negotiated a compromise on the bill that was signed into law.
Shortly after, however,ChristianaCare sued the state. In its lawsuit, the hospital called the review board “draconian,” and said its ability to reject hospital budgets violated the state’s corporate charter.
State lawyers denied those claims, saying the regulations have nothing to do with Delaware’s corporate law. In previous court filings, they further said that ChristianaCare’s arguments amount to an “army of strawmen” designed to halt the regulations.
Following an attempt by the state to dismiss the lawsuit, a judge in Delaware’s Court of Chancery allowed the lawsuit to continue.
Transparency Notice
David Singleton serves on the board of advisors for Spotlight Delaware. Advisors have no role in the editorial decision-making of Spotlight Delaware. For more information, see our Boards page.