Senate Bill Would Require State to Investigate Health Care Costs

New Hampshire’s insurance premiums and its health care costs are among the highest in the nation.

Families USA, a health care advocacy group, says median earnings here rose only 21 percent over the last ten years.

But insurance premiums climbed 92 percent.

In fact, Senator Kathy Sgambati is asking the health care question on everyone’s minds these days.

Senator Kathy Sgambati: “I want to know if you’ve found out where all the money is yet.”

Before she became a senator, Sgambati worked for the Department of Health and Human Services for more than two decades.

And so she knows more than almost anyone how the state’s health care system works.

And still, she asks:

Senator Kathy Sgambati: “You hear insurers, and hospitals, and people talk about having such difficult times, and so OK, where are all these gazillions of dollars?”

That’s what Senate Bill 392 is all about.

The bill, written by Democratic Senator Martha Fuller Clark, would require an annual public hearing at which insurers, doctors and hospitals would share financial information.

Presumably, they’d tell lawmakers and the public just why their prices are rising so fast.

The Department of Insurance would take that information – much of it a secret right now – and turn it into an annual report.

And, says Fuller Clark, the legislation spells out what would happen if insurers, hospitals or physicians choose not to share their data.

Senator Martha Fuller Clark: “The commissioner of insurance has the right to subpoena providers, hospitals, or health insurance companies if they don’t come forward and provide that information willingly.”

One problem that this legislation is attempting to highlight is something called price discrimination.

That means hospitals charge different prices depending on who you are.

For example, a big insurance company may get a 50 percent discount on a procedure at one hospital.

An uninsured person would probably be charged 100 percent of the cost.

And a small insurance carrier might pay 75 percent.

All for the same medical care at the same place.

Massachusetts already has a law similar to Senate Bill 392.

Last month, Massachusetts attorney general Martha Coakley used it to issue an explosive report on what’s driving health costs there.

It says price increases by powerful hospitals – not increased utilization or insurance company profits – are the biggest reason for Massachusetts’ high costs.

Proponents of Senate Bill 392 say it would be the first in the nation to require ongoing annual reports on cost drivers.

Tom Bunnell, director of a health policy institute at Franklin Pierce Law Center, says health insurers and health care providers traditionally blame each other for rising costs.

But, Bunnell says, among all that finger pointing, there’s been little solid information.

And so, he says, this bill is important.

Tom Bunnell, Franklin Pierce Law: “There’s an old adage that sunshine is the best disinfectant and this bill creates a process that requires transparency related to health care costs on the part of health insurance companies and health care providers, including hospitals.”

The fact that the bill expands scrutiny to hospitals and doctors is likely why some insurers support it.

Marla Matthews is a lobbyist for MVP Health Care.

Marla Matthews: “Our support is tied to the need for transparency, and we recognize that we can’t expect transparency from others unless we’re open to it ourselves and it’s our view that this process that is outlined in SB 392 would encourage transparency from all parties.”

But Leslie Melby of the New Hampshire Hospital Association can’t find anything to like about this bill.

Melby says she believes the insurance department would need to hire two or three people, at a cost to the state, to do the analysis.

And she points out that the bill doesn’t say what information hospitals and doctors would need to share.

Finally, she says, the Department of Insurance doesn’t regulate hospitals – HHS does.

Leslie Melby, New Hampshire Hospital Association: “Where it says that the insurance commissioner would have the authority to compel a health care provider to testify at the annual public hearing, it’s more of a strong-arm approach than one of cooperation and partnership.”

This bill is only the first serious shot across the bow at health care providers by Democratic lawmakers.

A bill designed to drastically change the way hospitals charge for their services is expected within a day or two.