STATE HOUSE, BOSTON - The hospital industry, with assistance from unions and a leading state employer, has called on taxpayers and employers to help cover the large cost of treating patients without health insurance, arguing such care is a social responsibility.

With the number of uninsured on the rise and the government scaling back health coverage programs, hospitals say they will continue to care for those who show up at their doors but can't continue to pick up the costs of treating the uninsured without negatively affecting health services for everyone else. Hospital executives say they face $85 million in uncovered costs this fiscal year, and $300 million in fiscal 2005.

The bulk of the cost of treating the uninsured is presently borne by hospitals and to a lesser degree, insurers, with a relatively small share of the cost paid by the state. Hospital officials testifying before the Health Care Committee Wednesday said the tab for treating the uninsured should be paid by everyone.

"What is needed is broad-based public funding for a broad-based social responsibility," said Timothy F. Gens, senior vice president of the Massachusetts Hospital Association. "It's too important a need and too vast a need to be funded so much by hospitals."

In related news, the Blue Cross Blue Shield of Massachusetts Foundation will release a report Friday on public attitudes about health care. The report by Dr. Robert J. Blendon and researchers at the Harvard School of Public Health found most people in Massachusetts strongly believe that everyone in the state should be able to get the health care they need and support several proposals to expand health coverage. The challenge of covering the cost of treating the uninsured is a policy question that has vexed Beacon Hill and national decision makers for decades. All of the major players - taxpayers, employers, insurers and providers - have resisted new health care costs, resulting in an endless cycle of cost shifting instead. And as health activists tout expanded coverage as the solution, the opposite is occurring - due to fiscal constraints both the government and the private sector are looking to restrict rather than expand benefits.

"The current system hurts patients, hurts hospitals, hurts insurers, hurts state government," said Paul Taylor, senior vice president of South Shore Hospital. The system, he said, is "broken beyond repair."

Cost-sharing and pool management reforms contained in this year's budget are helpful but temporary, and hospital officials say the state-administered pool that reimburses hospitals for treating the uninsured remains in danger of collapsing without long-term reforms. A special commission charged with developing solutions could not reach consensus in 2002. The Romney administration has been instructed by lawmakers to offer ideas, but has missed an Oct. 1 deadline and will now report in January.

In a Sept. 29 letter to lawmakers, Health and Human Services Secretary Ronald Preston said preliminary planning for a new program for the uninsured and underinsured had begun, but the secretariat was slowed in September because it was focused on implementing time-sensitive pool-related changes required under this year's state budget. Senate Health Care Committee Chairman Richard Moore (D-Uxbridge) said it was "regrettable" that the administration had not met its deadline or testified Wednesday. - more -

HOSPITALS: PUBLIC FUNDS, PAY-TO-PLAY SYSTEM WILL EASE HEALTH $$$ CRUNCH

Preston said meetings aimed at developing some solutions will begin Nov. 12.

Meantime, the hospital association endorses the principle of a pay-to-play system that would force employers who don't offer insurance to pay into a health care trust fund, Gens said. The association also supports maximizing federal funding and providing incentives for employers to offer health insurance and disincentives for those who don't offer coverage.

Employer groups have traditionally called for national health care solutions and resisted state-based mandates that they say place businesses at a competitive disadvantage with companies in other states. But some employers say a mandate is warranted.

A Shaw's supermarket executive told lawmakers Wednesday it's not fair that the chain covers its employees and their family members and then contributes, through insurance surcharges, to the cost of caring for employees whose employers don't offer insurance. "Employers who provide health care end up paying more than once," said Hugh Penny, vice president of compensation benefits. "We're looking to provide a level playing field." Penny said health care costs for employers are at a "crisis phase."

Richard Marlin, legislative director for the Massachusetts chapter of the AFL-CIO, urged lawmakers to model an insurance coverage system after the one that requires businesses to fund the pool that pays jobless benefits. "This is one of the most important issues that's going on," said Marlin.

Preston said it is premature to debate a pay-to-play system because policy makers have yet to define what they should be covering through the pool. Interim definitions were established in this year's budget but Preston says a more coherent definition of what services are covered, at which health care locations, and at what cost is needed before the discussion should begin on who will pay for those services. "My basic though is that's not the right topic to start on," Preston said in a telephone interview, referring to the pay-to-play concept. "It doesn't make sense to address it unless you know what you're buying. We need to be more coherent. We're not there because we haven't dealt with the first subjects yet. It's real premature to be saying there should be this kind of assessment or that kind of assessment."

Within the hospital industry, the pool's financing problems have led to divisions between suburban and urban hospitals. Suburban hospitals say they can't afford to continue subsidizing care for the uninsured rendered at urban hospitals. Urban officials say they can't continue being the caregivers of last resort when state government consistently reimburses them at a level significantly less than the true cost of care. Senate Majority Leader Frederick Berry (D-Peabody) urged his colleague to address the financial needs of community hospitals struggling to survive. He said such hospitals are community backbones and major local employers. But Berry sympathized with his colleagues, suggesting the dilemma, due to its magnitude and complexity, appears to present an "impossible situation."

In addition to concerns with their individual bottom lines, hospital officials say the problems in the so-called uncompensated care pool are so severe and have persisted so long that they are threatening the ability of one of the state' signature industries to attract the brightest workers, offer the best services and to ensure patient safety. Community hospital representatives say many facilities are at junk bond status. - more -

HOSPITALS: PUBLIC FUNDS, PAY-TO-PLAY SYSTEM WILL EASE HEALTH $$$ CRUNCH

Rep. Frank Hynes (D-Marshfield) joined South Shore Hospital officials in pressing for a bill sponsored by Rep. Kathleen Teahan (D-Plymouth) to help suburban hospitals that are net contributors to the pool. The bill would free hospitals of the responsibility to pay for free care rendered beyond their service region and require employers that don't offer insurance to pay into a fund that would help urban hospitals.

Hynes said suburban hospitals feel like they are being taxed to pay for care at other hospitals when they are struggling themselves. "It doesn't make a lot of sense," said Hynes. "This legislation should really be on the table. I think this moves us in the right direction."

Brian Rosman, director of policy and planning at the advocacy group Health Care For All, said the pay-to-play idea boils down to fairness. If a health insurance system were devised today from scratch, Rosman said, it's unlikely that employers would be selected to be the source of coverage. But given the reality of a voluntary employer-based insurance system, Rosman said improvements can be made.

"Most employers are making a total commitment to health for their workers," Rosman said. "The rest ought to make at least a little contribution. When some evade their responsibility, there's a real problem because those workers have nowhere to turn."

Rosman said based on a state survey in 2002, there were 181,000 full-time workers in Massachusetts who don't have health insurance coverage through their jobs. Often, he said, individual coverage plans are too expensive to be helpful. He said a $300-per-uninsured worker annual charge would produce $54 million.