Shupe: Bill would allow state control of local hospitals
Bryan W. Shupe, a Republican, serves the 36th District (Milford) in the Delaware House of Representatives.
There has been much debate about House Substitute 2 for House Bill 350 after the Delaware House of Representatives passed the measure, which authorizes a state-appointed board to review budgets and take money from our local hospitals. For the moment, let us put aside that Delaware’s legislature passed a budget last year in spite of the fact that it called for a 10% increase in spending when the state’s budget office stated its incoming revenues would be $700 million less than the year before.
Let us talk about the facts of the bill and how this legislation authorizes the state of Delaware to control our local hospitals — nonprofit entities that are a large portion of Delaware’s private market:
State will have ability to review hospital budgets
Under the proposal, the governor will appoint a committee to review the budgets of our nonprofit hospitals. The hospitals are already mandated to place their prices online, but now, the state wants to know their entire budgets, and to examine all revenues and expenditures. Keep in mind that the Delaware legislature approved $71.9 million for nonprofits through the grant-in-aid bill in 2023 — without reviewing the budgets, impact or outcomes of any of those organizations. Under this annual expenditure, an organization that employs the creator of HB 350, Speaker of the House Valerie Longhurst, D-Bear, received over $4 million.
The purpose of this review of our hospitals is to make sure they are meeting benchmarks that the state will set for them, defining how much they are allowed to spend. A small group of state-appointed individuals setting price controls on the private market, instead of allowing the invisible hand of the market to do so, is the definition of government overreach. This board has no clue about the street-level challenges and opportunities for each hospital, their needs for investment or their goals for the future. There is simply no way the state board can know the ever-evolving needs of health care inside our hospitals better than the local hospitals that employ thousands and serve tens of thousands of Delawareans.
State will have ability to take ‘excess revenue’
If our hospitals do not meet the benchmarks that the state sets forth, HB 350 gives authority to the state to take “excess revenue” from them and place it into its own state-run fund. Now, we are passing the point of government overreach and setting up a pillar of a socialist form of government, where the state takes income that companies earn and redistributes the revenue where the government sees fit. Instead of allowing our hospitals the ability to use their own revenue to invest in their employees, evolving technology and expansion, the authority of the state, under HB 350, can take that revenue and place it into what is being called a “community health fund.” This fund will be used by the government where the state determines it should be spent.
State will have ability to take over hospitals’ fiscal management
In addition to the state taking revenue from our hospitals if the state benchmarks are not kept, under HB 350, the state has the authority to take over the financial management of the local facilities. Now, we have government overreach, a socialist approach to the economy and state-run health care. Under this option, the state will have the authority to make decisions for our hospitals instead of our local employees, who our hospital systems put in place to manage the financial health of their own organizations.
Even more concerning is that unchecked, bad policies like HB 350 will continue to pass in the state of Delaware as long as a supermajority exists in the General Assembly. The House majority literally shut down debate on the House floor during the discussion of HB 350, with an obscure rule that states that five members can vote to cancel floor debate on a bill. Knowing the majority had the votes, many representatives on each side of the aisle — who were elected to be the voice of over 20,000 individuals from their districts — were silenced. A supermajority promotes political ideology over the needs of the people of Delaware, and without a balance of power in the state legislature and across of three branches of government, extreme ideology will rule the day.
Reader reactions, pro or con, are welcomed at civiltalk@iniusa.org.
