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The Connecticut Hospital Association (CHA) continues to raise alarms about the ongoing issues with the Office of Health Strategy (OHS) cost growth benchmark process and recent policy recommendations, citing data inconsistencies, financial strains, and overlooked advice from healthcare professionals.

Earlier this week they wrote a letter to lawmakers on the Public Health and Insurance and Real Estate Committees outlining their concerns. 

CHA said OHS has put forth a recommendation to implement Performance Improvement Plans (PIP) for entities that fail to meet the benchmark, and civil penalties for those who don’t file a PIP when required. The CHA argues that instituting such measures is premature and inappropriate, given the ongoing data challenges.

A spokesperson for OHS said benchmarking is an important tool for slowing growth in healthcare spending. 

“High health care costs in CT are a barrier to patient access and a consumer financial burden,” an OHS spokesperson said. “Our report recommendations are derived from several sources including the Cost Growth Benchmark Hearing, the Information Hearing held by the CT Insurance Department, follow up discussions with benchmark hearing participants, members of the benchmark steering committee, other benchmark states, and other stakeholders including community organizations, advocates and members of the CT General Assembly. As such, OHS crafted a diverse set of recommendations aimed at tackling the complex nature of high health care costs.” 

Sen. Jorge Cabrera, D-Hamden, who co-chairs the Insurance and Real Estate Committee, said they are working hard to make sure health insurance and health care is affordable and bringing some accountability and transparency to the process will help. 

He said they want to make sure the cost growth benchmark is maintained because at the moment it’s higher than inflation and hurting those with private insurance. Cabrera added that they are also concerned with the amount of consolidation among hospital networks like Hartford Healthcare and Yale New Haven, which have pretty evenly divided the state. 

Another recommendation of the OHS is to institute out-of-network price caps to reduce market pressure by providers who refuse to participate in insurer networks.

CHA warned in the letter that requiring price caps on out-of-network services could lead to billions of dollars in reductions to local hospitals. Such a move, coupled with the ongoing financial strain highlighted by CHA’s report on the pandemic’s impact, could jeopardize healthcare delivery. Both the CHA and OHS reports for fiscal year 2022 corroborated the increasing financial distress, with hospital expenses outweighing revenues, resulting in negative operating margins.

CHA also emphasized that the current Certificate of Need (CON) program, required for any changes in services, is laden with administrative and bureaucratic barriers that impede the delivery of top-tier healthcare. The organization says delays in application reviews and a lack of financial oversight in decision-making processes are exacerbating healthcare costs.

The CHA is calling for legislative efforts to streamline the CON process, eliminate unnecessary costs, ensure rule compliance and equality in application, and alleviate regulatory burdens.

“The high cost of health care is a crisis. We will continue to work with the hospitals and other partners to drive down the cost of care for all our residents,” an OHS spokesperson added. 

Meanwhile, with hospitals bearing increased costs for providing uncompensated care and grappling with inadequate Medicare and Medicaid reimbursements, the CHA is asking OHS to reconsider its recommendations.