Why Should Delaware Care?
Hospital costs in Delaware are some of the highest in the nation, which impacts the budgets of individuals and the state, with its obligation to fund Medicaid and retiree benefits. In response, Delaware lawmakers have created one board to set targets for cost increases and another board with the authority to veto hospital budgets deemed excessive. But that authority has opponents saying it usurps the power of hospital.
The hospital industry in Delaware expects health care costs to surge again next year, a hospital representative said Thursday during a meeting of state officials tasked with setting spending targets for the industry.
During the meeting, Christina Bryan of the Delaware Healthcare Association gave a presentation showing national projections that call for a hefty 8.5% increase in hospital, pharmaceutical and other medical spending in 2026.
If that were to occur in Delaware, it would pile onto health care spending increases in recent years that totaled nearly $2 billion – an amount that far outpaced the rate of inflation.
In 2023, the average Delawarean spent more than $10,500 on health care.
Bryan gave her presentation to members of the state’s Healthcare Spending Benchmark subcommittee of the powerful Delaware Economic and Financial Advisory Council. During the meeting, the subcommittee members weighed whether to approve a new goal for Delaware spending increases – a metric designed to encourage hospitals to be more thrifty.
Delaware is among eight states to set government spending goals for the healthcare industry, which it calls benchmarks. In 2018, then-Gov. John Carney created Delaware’s system with the signing of two executive orders.
Since then, Delaware has blown past its spending benchmarks almost every year they had been in effect.
When considering the latest benchmark, the chair of the Delaware Economic and Financial Advisory Council, Alan Levin, expressed skepticism toward a goal that could limit hospital spending below national projections, saying he would not recommend one unless it could “be supported with data.”
Ultimately, the members of the subcommittee did not recommend a new benchmark, and instead kicked the decision to later meeting.
The final vote on the benchmark will likely occur in October during a meeting of the full Delaware Economic and Financial Advisory Council.
Lawsuit paused
The state officials discussed the healthcare spending goals even as a lawsuit threatens the Delaware regulatory board responsible for enforcing the benchmark.
The Diamond State Hospital Cost Review Board, established as an oversight mechanism to review hospital spending, has faced massive opposition from health systems. And, last year, Delaware’s largest hospital system ChristianaCare sued the state over it.
In a recent filing in the suit, attorneys for the two sides agreed to pause further proceedings until Sept. 30 in “the interests of the parties and the public.”
When reached by phone, Kurt Heyman, an attorney representing the state, did not provide details beyond what was said in the filing, and so it is unclear if the pause means the two sides are working on a settlement.
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