Why Should Delaware Care?
Hospitals outspend other sectors of the healthcare industry by wide margins. In recent years, Delaware lawmakers have passed legislation meant to lower the impacts of those costs on the state and on patients. One of those new laws targets how hospitals administer what is called “charity care,” and who is eligible.
A state oversight board responsible for guiding how nonprofit hospitals will dole out free and discounted care met on Tuesday to review how Delaware will hold providers accountable in the coming years.
Delaware’s pursuit of these regulations comes months after lawmakers passed Senate Bill 13, a bill that greatly expanded the pool of patients able to receive that free or discounted care, sometimes called “charity care.”
Tuesday’s meeting of the Diamond State Hospital Cost Review Board was another step in what has been a monthslong process to draft and implement regulations guiding how hospitals give away charity care.
Earlier this month, financial leaders from Delaware’s hospital systems flooded a small government meeting room to voice concerns about the new regulations.
The embattled board, which was formed in recent years to bring down hospital spending that has long burdened the state budget, will also hear a more detailed presentation from the state’s six hospital systems next month where they will likely discuss the pending regulations.
What happened during the meeting?
Tuesday’s meeting was more of a recap of the work the board, alongside an outside consulting group, have already done since it was tasked with forming the charity care regulations. Still, leaders discussed how the rules may impact not only Delaware’s hospitals, but also the patients they aim to protect.
One board member and former state Secretary of Finance, Rick Geisenberger, pointed to one of the proposed rules which would guide how hospitals screen patients for eligibility.
He homed in on a section that says hospitals would have to screen both insured and uninsured patients with balances over $500.
This, Geisenberger said, could encompass a majority of patients receiving care in a hospital. And depending on how a hospital screens its patients, whether internally or through an outside vendor, that per-patient cost could add further administrative costs to hospitals.
“I think our goal is not to increase healthcare costs,” Geisenberger said.
Hospital leaders had also expressed their concerns earlier this month about what and how much information they would be able to request from patients to determine their eligibility to receive charity care.
Additionally, the board discussed its role in enforcing the new regulations and how it would handle complaints of hospital noncompliance.
The board agreed it would be the first to receive any complaints, passing off credible complaints of charity care violations to the Delaware Division of Health Care Quality (DHCQ), which is responsible for examining any licensure violations.
Separately, the board would also have the power to do a “periodic outside audit” to see if hospital trends suggest it has unusually high denial rates or determination times for eligibility.
What is Senate Bill 13?
The impending charity care regulations were spurred by Senate Bill 13, which was signed into law earlier this summer. The new state law greatly expands the pool of Delaware patients eligible to seek financial relief on their medical bills.
It also followed a separate effort last summer in which the state paid off medical debts for thousands of Delawareans, despite existing hospital charity care policies that could have made that treatment free.
The legislation was also introduced months after a Spotlight Delaware investigation called into question the charity care practices at the state’s largest healthcare system, ChristianaCare.
Under the new law, all of the state’s nonprofit hospitals would be required to provide free care to patients living below 300% of the federal poverty line, with large discounts for patients in higher percentage brackets.
- Below 300% of the FPL (currently $47,880 a year) – Full discount
- 300-350% of the FPL (currently $47,880 to $55,860 a year) – 75% discount
- 350-400% of the FPL (currently $55,860 to $63,840 a year) – 50% discount
Separately, the legislation allows people living at 500% of the Federal Poverty Line — currently $79,800 a year — to seek out a 50% discount if the billed expenses are greater than 10% of their income.
The legislation also charged the Diamond State Hospital Cost Review Board to implement and hold hospitals accountable to the new regulations. The law said regulators were required to draft regulations “with input” from the state’s hospital lobby.
At a meeting in early October, the hospital lobby’s CEO, Brian Frazee, said hospitals have had to contend with a rapid series of regulatory changes in recent years. He pointed to the formation of the board, which was established to rein in the growing cost of hospital spending on the state’s budget.
He also said changes at the federal level like reductions to Medicaid and Medicare would add strain on hospitals. Still, he said his group and the state’s hospitals were glad to be a part of attempts to bring down the cost of care in the state.
“I think it’s important to understand just how much change is happening at one time,” Frazee said. “That being said, we are more than happy, and we’re proud, frankly, to be leaders in terms of that.”
Get Involved
The Diamond State Hospital Cost Review Board is set to next meet at 10 a.m. on Tuesday, Nov. 17, at the Herman M. Holloway Sr. Campus Main Administrative Building, located at 1901 N. Dupont Highway in New Castle. More information, including about virtual attendance, can be found here.
