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Deal Would Take Controversial Hospital Pricing Question Off Ballot04:25
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It was to be a game of high stakes politics with hundreds of millions of health care dollars on the line. But on Wednesday the players negotiated a truce — with help from unified leaders on Beacon Hill — to prevent a November ballot question on hospital prices.

"It is my hope that this plan will avert a costly and divisive ballot initiative and lend assistance to our community hospitals," said House Speaker Robert DeLeo in a statement.

The ballot initiative that brought DeLeo, Senate President Stan Rosenberg and Gov. Charlie Baker together aimed to close the gap between high and low cost hospitals. It proposed cutting $463 million in payments to the state's more expensive hospitals and redistributing that money to struggling community hospitals and to consumers through lower premiums.

The Massachusetts Hospital Association opposed the plan. MHA President Lynn Nicholas is relieved to hear voters won’t be asked to adjust price differences between her members.

"The most important aspect of this resolution is not doing complicated public policy through a blunt instrument at the ballot box," Nicholas said.

The ballot question was proposed by a health care workers union, 1199SEIU. Estimates showed the state's largest private employer, Partners Healthcare, would have lost more than $400 million a year.

The influential union and the top employer have been in and out of offices on Beacon Hill for weeks, negotiating roughly a half dozen different plans that would have legislators instead of voters settle the hospital price gap problem.

"The most important aspect of this resolution is not doing complicated public policy through a blunt instrument at the ballot box."

Lynn Nicholas

The consensus deal announced Wednesday includes some more money for community hospitals — at least $20 to $25 million a year, divided between several dozen hospitals. Some hospitals would benefit and some would lose if an additional hospital assessment of $250 million is approved and distributed through Medicaid payments. The union says it is pleased.

"This agreement is the first substantive step toward leveling the Massachusetts healthcare playing field," said 1199SEIU Executive Vice President Tyrék Lee, Sr.

The new payments would offer some short-term relief for struggling community hospitals. For the long-term solution, the agreement revives a "Special Commission to Review Variation in Prices Among Providers."

"The language that we’re currently polling out of committee addresses immediate needs in terms of financing and at the same time establishes a provider price commission to take a look at the factors that are contributing to price variation," said state Rep. Jeff Sánchez, a Democrat, on Wednesday night.

A similar commission that met five years ago struggled to see action on its recommendations. But Sánchez, who would co-chair this commission, says it's time to bring stakeholders together again. Some hospitals that have called the payment gap in Massachusetts unfair say they look forward to participating.

"We are hopeful that the Special Commission will develop fair and transparent proposals to ensure that health care prices reflect consumer value to achieve lasting benefits for everyone," said Andrew Mastrangelo, director of media relations at Lahey Health.

The ballot question alternative may be on the House floor for a vote Thursday.

There are pieces of the agreement that don’t make sense to the state’s leading health care consumer group.

"I think there’s a flag raised about how some of this compromise will be paid for," said Amy Whitcomb Slemmer, executive director at Health Care for All. She notes that most of the money for struggling hospitals would come from the state’s Center for Health Information and Analysis (CHIA), the agency whose reports have detailed the wide variation in hospital prices and the effect on rising health care costs.

"We look to CHIA for unbiased, unvarnished information about what the health of our health care delivery system really is," said Whitcomb Slemmer, "so I hope that funding shift or shortfall is made up in another way."

The ballot question agreement would cut CHIA's budget by $5 million, or 17 percent, in the first of five years and then $10 million or 35 percent for the next four years.

That’s the public agreement by which 1199SEIU says it would drop the ballot question. But sources familiar with the public deal say there's a private arrangement, with Partners, that the union insisted on before it would back away from the ballot campaign.

Under the private agreement, sources say Partners would not interfere with union organizing efforts at some of its community hospitals, such as North Shore Medical Center, for example. But the union would not be welcome at Partners major teaching hospitals, Massachusetts General or Brigham and Women’s.

In a joint statement, 1199SEIU and Partners describe a new strategic alliance: "We have always respected the rights of our workers to choose whether to be represented by a union, or not. Future organizing efforts will be designed to ensure the rights of our workers to make free and fully informed decisions on this question through the process of a secret ballot election.”

Neither Partners nor 1199SEIU would answer questions, referring reporters to their statements.

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