Massachusetts ballot proposition to equalize hospital payments could be disastrous

A union-backed ballot initiative to equalize payments to hospitals in Massachusetts is raising significant concerns both within and outside the provider community.

If passed by voters later this year, no hospital would be paid more than 20 percent above the statewide average for any medical procedure, according to The Boston Globe. The initiative is sponsored and supported by the Service Employees International Union.

Although the proposition is aimed primarily at Partners HealthCare, the Bay State's powerful 10-hospital not-for-profit system, and would take up to $440 million in annual payments away from that enterprise, other providers could be financially vulnerable as well. 

"You would destroy institutions overnight," Stuart Altman, chairman of the state Health Policy Commission and a healthcare economist at Brandeis University, told the Globe. He suggested more incremental changes instead.

Nevertheless, there appears to be a payment disparity among Massachusetts hospitals. A study released last year concluded that statewide, 86 percent of payments for inpatient service and 73 percent of all outpatient payments are going to higher-priced facilities.

Partners has said such a change could force it to cut thousands of jobs. It has been negotiating with the union for a compromise.

It's not the first time the SEIU has used the ballot box to play hardball with hospitals. In California, it backed a successful initiative to cap the compensation paid to executives at El Camino Hospital, a district facility in the city of Mountain View, although it was eventually struck down in court.

The union also planned a wider-ranging ballot initiatives on hospital executive salaries and charges for care in California, but reached terms with the state's hospitals on various matters before deciding to withdraw the measures.

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