My take: Getting a handle on hospital costs minus the bureaucracy

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Two op-ed pieces in Tuesday’s newsletter featured contrasting views on legislation that would establish a regulatory panel governing hospital pricing.

House Minority Leader Danny Short sees the bill as an attempt to put politicians in charge of hospital care while introducing an intrusive bureaucracy. The bill’s sponsor, House Speaker Valerie Longhurst, says something needs to be done to control runaway costs that are straining the state budget. 

With Democrats in control of both houses and the governor’s office, passage is possible although a furious lobbying effort from healthcare systems is underway.

Short picked up the Delaware Healthcare Association’s argument that a similar regulatory system in Vermont puts hospitals in financial peril while reducing the quality of care.

My take is that Vermont is not Delaware. The First State comprises a handful of financially stable hospital systems serving 400,000 more residents than their counterparts in the lightly populated Green Mountain State. There is also easier access to health care systems in Philadelphia and, to a lesser extent, Baltimore.

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Moreover, Vermont has more rural hospitals that would be in financial peril even if regulatory machinery was not in place.

Still, regulating hospital rates is a process loaded with potential pitfalls and the probability of a bureaucracy with limited effectiveness.

A few ideas come to mind:

1. The governor summons the CEOs of the state’s hospitals — a very small group — to drive home the importance of controlling costs and demanding a path forward.

2. The state explores various options, including those that have worked in other states.

3. One approach that would be easy to implement is full disclosure of finances. At present, gaining hospital system information is not for the faint of heart. IRS forms are at least a year old, and regulatory filings with Medicare provide only a partial picture. 

Delaware should require all hospitals to post detailed financial reports in an easily digestible format on the state’s open data website. An easy-to-use format for the costs of services is also needed.

Greater transparency would allow the public and government to understand these challenges better.

The above suggestions would offer a way to move forward before setting up a regulatory system loaded with question marks and pitfalls. Doug Rainey, chief content officer.

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