Public Health Committee
JOINT FAVORABLE REPORT
AN ACT CONCERNING THE OFFICE OF HEALTH CARE ACCESS AND THE CERTIFICATE OF NEED PROCESS.
Joint Favorable Substitute
SPONSORS OF BILL:
Public Health Committee
REASONS FOR BILL:
To make changes to various public health statutes involving the Office of Health Care Access (OHCA):
To provide OHCA with access to financial data to properly evaluate the financial data to properly evaluate the financial impact of the Certificate of Need (CON) proposal on the state's health care system.
To clarify when the hearing record is legally closed as well as the day on which the 60 day review period begins for OHCA to render a decision.
To require hospitals to file a statement of operations and utilization.
RESPONSE FROM ADMINISTRATION/AGENCY:
Kimberly Martone, Director of Operations, Office of Health Care Access (OHCA): Provides the following information in favor of the Bill;
Section 1 allows the OHCA to verify and measure the effect a Certificate of Need (CON) proposal has on the applicant by reviewing the financial status of the applicant but OHCA does not have the data to properly evaluate the financial impact of the CON proposal on the state's health care system. This financial feasibility evaluation is a more realistic guideline and most applicants are able to produce financial documents and analysis demonstrating that a particular proposal is financially feasible. The majority of CON proposals received and reviewed by OHCA over the past year involved the acquisition of imaging equipment, the establishment of substance abuse/mental health services, and transfer of ownership of health care facilities. These proposals are a clear demonstration of their impact on the financial strength of the health care system statewide.
Section 2 clarifies the closing of the hearing record as opposed to the actual public hearing. This proposed language clarifies when the hearing record is legally closed as well as the day on which the 60 day review period for OHCA to render a decision begins.
Section 3 requires hospitals to file a statement of operations and utilization statistics on a quarterly basis, which will provide OHCA with a small number of performance indicators or measures in order to see more immediate financial and utilization performance results, and allow OHCA to publish a dashboard of financial indicators quarterly. This change will allow OHCA to provide the public and policy makers with the most current information on the financial performance of Connecticut's hospitals.
Hospital finances are dynamic and fluid. OHCA wants to enhance data reporting efforts and collect certain information on a quarterly basis to be positioned to inform policy makers of early indications of trends in performance, on a hospital-specific, regional or statewide basis. The data elements which OHCA will request will be limited and will include: amounts for operating and non-operating revenue; various expenses such as interest expense and depreciation; current assets and liabilities; discharges; patient days; staffed beds; average daily census; and case mix index. This information measures profitability, liquidity, solvency and hospital utilization. OHCA's collecting and reporting of the quarterly data would be similar to that of other states and it would be clear that the information is based upon unaudited financial statements.
Section 4 revises the date of receipt of net revenue verification from February 28 to March 31 of each year; to make the filing date of the new verification of net revenue document the same as the Twelve-Month Actual Filing, which is March 31st. This reduces the possibility of the hospitals filing numbers on the Hospital Reporting System (HRS) that may differ from those within the verification of new revenue document.
Section 5 revises the statute to omit an obsolete reference to a hospital rate setting process that was in place during 1992 to 1994, when the Commission on Hospitals and Health Care (“CHHC”, OHCA's predecessor agency) was authorized to set acute care hospital rates. The statutory rate setting program sunset on March 31, 1994.
Section 6 makes a technical revision, removing ambiguity and making clear that the study will be done every two years and not twice a year. It also specifies that “the study may include” instead of “the study shall include.”
This change allows OHCA to exclude from the study utilization data from facilities such as outpatient surgical facilities until OHCA has access to complete useable data in June 2015, as stipulated in §19a-654. OHCA proposes to update the statewide health care facility plan every two years and will need to devote a significant amount of time and resources to the plan during those years. In subsection (b), OHCA proposes to change the time frame by which the state health care facility plan is updated to allow for more frequent updates that may be necessary due to health care reform, technological advances and billing changes. Also, it will provide health facilities and providers, covered under the statute, with the ability to initiate the updates based upon their experiences.
Section 7: revises Subsections (a) to (g), inclusive of Section 19a-646 for the following reasons:
● The Office has not regulated discounts (contractual allowances) since hospital rate-setting ended, March 31, 1994. Almost all of the nongovernmental (commercial) contracts are negotiated;
● The dates referenced in the statute have long expired;
● The main purpose for the agreements being filed was due to two hospital tax programs, the Gross Earnings (“GET”) and sales taxes, which ended in 1998 and 2001, respectively;
● Discount agreements or contracts negotiated for a different rate or method of reimbursement have not been filed or reviewed at OHCA since 2002;
● The agreements no longer need to be submitted to OHCA. They are required to be filed within 24 hours of their execution at a hospital's business office and available for viewing upon request; and,
● The Office no longer holds public hearings for aggrieved payers that have not been awarded a discount by a hospital if the hospital had awarded a discount(s) to other payer(s).
OHCA requests amending the proposed language in lines 284-287 from “…to a municipality or state agency, as defined in §4-230, another state, or a federal agency…“ to “a state agency for the purpose of health care services delivery improvement or oversight; a federal agency or the state of Connecticut Office of the Attorney General for the investigation of hospital mergers and acquisitions; or another state's patient-level data collection agency with which the office, for the purposes of certificate of need review or state-wide health care facilities and services planning, enters into a reciprocal data-sharing agreement.”
This revision clarifies which entities may receive patient-level data (a record of the patient's information which includes demographics, diagnoses, procedures but not patient name, SSN or address) and for what purposes.
The proposal adds language to §19a-654 that would allow for the release of patient level data to certain governmental entities for specific purposes. Any such entity receiving the data shall sign a data use agreement which will require the entity to protect the confidentiality of the personal health data, not to re-transfer or re-distribute the original data, and not to identify or contact individuals in the data for any reason.
OHCA receives requests from other state agencies (e.g., DCF, DMHAS, DSS, OHR&I) for patient-level data that is not releasable under §19a-25 but is needed for service delivery improvements, cost analyses and program innovation.
OHCA also receives requests for inpatient hospital data from the Federal Trade Commission and the Attorney General's Office in the course of investigating potential mergers between hospitals and other health care facilities to determine whether the proposed merger would violate antitrust laws. In the past, OHCA was able to release the requested information, but in light of changes made to §19a-654 under Public Act 11-61, OHCA is only able to release patient-identifiable data pursuant to §19a-25, which does not allow for the release to the federal or state government for investigation into antitrust matters.
Current statute prohibits reciprocal sharing of patient-level data with health care services-related agencies in states bordering Connecticut, especially in markets where there is a great deal of cross-border migration. This prohibits the office from conducting comprehensive utilization analyses required for adequate health care facilities and services planning.
OHCA requests the elimination of the proposed language in Section 10: “or enter into a contract for another entity to provide a service” as it is too broad and may extend beyond OHCA's authority pursuant to §19a-638. OHCA only regulates health care facilities as defined under §19a-630 and this language appears to extend OHCA's authority beyond its statutory authority pursuant to §§ 19a-630, 19a-638, and 19a-639. This language expands OHCA's authority into regulating the types of services and entities beyond health care facilities, as defined pursuant to §19a-630, that it currently does not have authority to review. Therefore, OHCA requests to eliminate/delete the proposed new language and maintain Section 10 as originally drafted. Due to the fact that the Department does not currently require Certificate of Need authorization for contractual arrangements, additional staff would be needed to meet this requirement.
NATURE AND SOURCES OF SUPPORT:
NATURE AND SOURCES OF OPPOSITION:
Melodie Peters, First Vice President, AFT Connecticut (AFT): The proposal is headed in the right direction but doesn't go far enough. It is troublesome that there are limited opportunities to weigh in on the privatization of our hospitals and the accountability for access.
AFT CT recommends adding to section 2(d) “…provide notice of this determination to the applicant, if applicable, the collective bargaining agent and to the public…”
The Certification of Need (CON) process needs to continue to be a process that is transparent, involves all concerned parties and that the public good is the sole beneficiary.
AFT CT offers the following suggestions for consideration:
(1) Requiring disclosure of any potential conflict of interest by both applicants and decision makers in section 1(a)(1-9) e.g., “a conflict of interest for Office (of health Care Access) members exists when the individual member has a financial or personal interest in a matter under consideration by OCHA [sic]. The personal interest of a member exists and must be disclosed. The personal interest of a member includes the interest of the member's employer, even though the member may not receive monetary or pecuniary remuneration as a result of an adopted CON review standard.”
(2) Sec. 1(a)(10) “whether the applicant has satisfactorily disclosed the existence of factors that may be deemed a financial or personal interest in the proposed project by anyone in the applicant's governing body”.
The healthcare landscape is rapidly changing and the process must have the highest rigor if we want our system to have integrity.
Louis Sorrentino, CAC: The proposed language is very disturbing. Public health services for downtrodden people needs the current language to stay as it is.
Reported by: Mike Smith