UConn Health Center is facing $114 million loss in revenue after the coronavirus pandemic emptied beds and ended a large number of medical procedures, according to the budget presentation given to the UConn Board of Trustees. According to figures, patient revenue to UConn Health tanked by almost 50 percent during ...
Mercatus Center ranks Connecticut 48th in nation for healthcare openness and access
Connecticut often ranks very low in the nation for taxation, debt, and regulatory burden, but a new research project from the Mercatus Center at George Mason University ranked Connecticut 48th in the nation for healthcare access and openness.
The project, known as The Healthcare Openness and Access Project, found that Connecticut’s insurance restrictions and medical liability laws hinder access to affordable healthcare. The project is meant to be a tool by which lawmakers can learn what is effective in other states.
Although Connecticut ranked highest for access to e-cigarettes, naxalone – to prevent opioid overdoses – and good samaritan protections, state insurance restrictions and regulatory burdens were ranked as some of the worst in the nation.
One of the critical determining factors in limiting access to healthcare, according to the study, is that states like Connecticut restrict how much insurance companies can change their rates. Interference in health insurance rates means prices do not reflect the true cost of insurance because companies cannot “design their products to meet the demands of their customers.”
According to Robert Graboyes, one of the authors of the report, insurance companies increase their prices to factor in state controls. “If a company faces price controls they’re going to price in such a way that the controls don’t bog them down so much they are losing money. It actually has a tendency to raise the rates.”
For insurance companies in Connecticut, rate changes must be approved by the Connecticut Insurance Department. For example, in 2017 the Insurance Department approved a rate increase of 6.6 percent by Cigna for new individual and small-group plans.
Likewise, the Insurance Department rejected ConnectiCare’s request for a 15.6 percent increase and changed it to 14.9 percent for 2017.
Graboyes says that part of the unintended consequences of controlling insurance rates is that younger, healthier people leave the company due to high costs and “you end up with a sicker pool of people.”
The cost of insurance in Connecticut is also affected, the study says, through state mandated insurance benefits beyond what is already required by the Affordable Care Act. “It’s the states that lay down dozens and dozens of mandates and Connecticut lays down more than most others,” Graboyes says.
However, Graboyes notes there are many things a state can do to make healthcare more affordable and accessible. For instance, easing licensure restrictions through medical license reciprocity would allow doctors from other states to come to Connecticut and open a practice without having to go through the process to obtain a Connecticut license.
Connecticut currently does not have reciprocity with any other state, although it will accept test results from other state’s licensing exams.
One of the most restrictive aspects of Connecticut’s healthcare is the certificate of need required by hospitals to expand services or transfer ownership.
“It’s a doctrine that was adopted nationwide in the mid-20th century for reasons that proved spurious,” Graboyes said. “It doesn’t do the good things it was supposed to do and it does bad things, like limit competition within hospitals.”
In Connecticut, the CON is reviewed and controlled by the Office for Health Care Access, which evaluates CONs to ensure they meet with state regulations.
Some Connecticut hospitals have a troubled history dealing with Office for Health Care Access and CONs. In February of 2015, Tenet Healthcare Corp. ended its bid to buy five Connecticut hospitals after the OHCA imposed 47 conditions that Tenet said were “too restrictive.” The sale included Waterbury Hospital, which faced serious financial problems. As a result, Waterbury Hospital had to lay off employees and cut salaries.
Despite the loss of Tenet, in June of 2015, Gov. Dannel Malloy signed An Act Concerning Hospitals, Insurers and Health Care Customers, making certificate of need regulations more onerous for hospitals to obtain in order to transfer ownership.
According to the new law, in order to transfer ownership of a hospital, the buyer must submit a three-year plan to the OHCA, including how the plan will affect its customer base. The agency is required to deny a CON if the surrounding community cannot be guaranteed “continued access to high quality and affordable health care.”
The bill also gave OHCA nearly unlimited ability to place additional conditions on a hospital to have their CON approved. “The office may place any conditions on the approval of a certificate of need application involving a transfer of ownership of a hospital.”
After political backlash against the Malloy administration over the loss of the Tenet deal, the OHCA quietly approved the sale of Waterbury Hospital to another for-profit medical group, Prospect Medical Holdings, in June of 2016.
However, some states are starting to move away from CONs altogether. In 2016 New Hampshire became the 15th state to repeal its certificate of need law, joining other states like Pennsylvania, Colorado and California.
The study notes that although it is meant to be a comparison between the states there is no political ideology that appears consistent with more accessibility to health care. The study points out that “Oregon, a reliably blue state, offers broad leeway to patients and providers while Georgia, a very red state, has some of the most restrictive healthcare laws and regulations in the nation.”
“There are a lot of things you can take from this,” Graboyes says, “and we want states to look at these and to think about them in their own ways.”
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