HB1143 / SB1199
An Act Relative to the Closing of Hospital Essential Services

The Massachusetts Health & Hospital Association (MHA), on behalf of its member hospitals, health systems, physician organizations, and allied healthcare providers, appreciates this opportunity to offer comments on HB1143/SB1199, “An Act Relative to the Closing of Hospital Essential Services”. MHA respectfully urges the committee to reject this legislation as the specifics within related to public notice of a closure of an essential service already are included in the recent amendments to the hospital licensure regulatory changes that the Department of Public Health (DPH) issued. In addition, this legislation puts in place barriers that may prevent hospitals from making strategic plans to merge or consolidate services within an integrated care delivery system, such as an Accountable Care Organization.

This past April DPH issued revised licensure regulations that already require hospitals to provide specific operational and access information related to any pending closure of an essential service. Similar to the directives of HB1143/SB1199, a hospital must provide notice of the closure to the general public, employees, legislators, and other state agencies who may be affected by the closure. In addition, a hospital must submit this information to the Health Policy Commission, which has the authority to share the information with the Attorney General’s office for further review.

MHA is concerned that HB1143/SB1199 extends the hospital notice period from 90 days to 120 days, and increases the number of stakeholders from communities outside of the hospital’s service area who must be contacted with notices of the service closure. While the hospital community is committed to working within the requirements of the DPH regulations, we are troubled by the increased administrative costs and staff time to meet the additional reporting and notice provisions in HB1143/SB1199.

Ensuring that all patients have appropriate access to medically necessary acute and emergency level care always has been a priority for the hospital community. However, the pressures created by continued underfunding of services, administrative barriers to coverage for services, and increased unfunded government mandates creates substantial problems for hospitals in fulfilling new mandates and covering the cost of services -- especially at a time when providers are trying to manage ever rising pharmaceutical costs, increased workforce demands and wage updates, high costs for maintaining or purchasing new technology, and maintaining aging facilities. This situation presents even more dire consequences for hospitals that serve large populations of patients with publicly subsidized coverage. As a result of these pressures, it is critical that hospitals have the flexibility to make strategic decisions that may include decreasing or merging services/programs. Communities rely on hospitals to provide acute and emergency level care for their residents.

While delaying the overall planning process by increasing the closure of the essential health services review period from 90 to 120 days, HB1143/SB119 also requires hospitals to develop and manage a new non-governmental community oversight committee comprised of a representative from each municipality to which the hospital provides services. This committee also includes non-managerial employees, including registered nurses and ancillary staff from the hospital, and a representative from a local interfaith organization to review/comment/consider any plan DPH approves for the hospital. The community oversight group is then empowered to inform DPH when a hospital does not execute and follow the plan. This would mean that hospitals that are already understaffed and facing significant financial problems, must now take on a lengthy committee deliberation process (which could take weeks, if not months), and manage a complex number of stakeholders as part of a the required process – while still continuing to provide healthcare services. While requiring the development and management of such an oversight committee is unprecedented and costly, the bills also lack any directives aimed at actually improving the fiscal standing of the hospital or the enhanced rates necessary to support the increased staffing and operational and facility costs required to sustain the quality and safety standards for the service in question.

Equally troublesome, under HB1143/SB1199, if a hospital were to execute a plan to discontinue services without the approval of DPH, the Attorney General would be empowered to seek an injunction to require that the service be maintained for the 120-day notice period without providing the increased resources needed to maintain the services. Additionally, the hospital would not be eligible to have a determination of need or other licensure application approved for a period of three years from the date that the service is discontinued, until the essential health service is restored, or until DPH is satisfied that a plan is in place to assure access to necessary services for patients in the hospital service area. This prevents facilities from developing new services or changing services that may better reflect the need of the local community.

By ignoring the systemic issues that are forcing hospitals to balance the preservation of needed services, HB1143/SB1199 could likely exacerbate fragile hospital financial challenges through the imposition of new restrictions and penalties. While perhaps unintended, the consequences this legislation poses to needed services in local communities and the continued viability of distressed hospitals could be severe. For these reasons, MHA urges you to oppose HB1143/SB1199.

Thank you for the opportunity to offer testimony on this matter. If you have any questions or require further information, please do not hesitate to contact Michael Sroczynski at (781) 262-6055 or msroczynski@mhalink.org.