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HOUSE DOCKET, NO. 1374 FILED ON: 1/18/2023
HOUSE . . . . . . . . . . . . . . . No. 979
The Commonwealth of Massachusetts
_________________
PRESENTED BY:
Mark J. Cusack
_________________
To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
Court assembled:
The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:
An Act relative to transparency of hospital margins & ensuring hospital efficiency.
_______________
PETITION OF:
NAME:DISTRICT/ADDRESS :DATE ADDED:Mark J. Cusack5th Norfolk1/18/2023 1 of 3
HOUSE DOCKET, NO. 1374 FILED ON: 1/18/2023
HOUSE . . . . . . . . . . . . . . . No. 979
By Representative Cusack of Braintree, a petition (accompanied by bill, House, No. 979) of
Mark J. Cusack relative to the public reporting of hospital margins. Financial Services.
[SIMILAR MATTER FILED IN PREVIOUS SESSION
SEE HOUSE, NO. 1232 OF 2021-2022.]
The Commonwealth of Massachusetts
_______________
In the One Hundred and Ninety-Third General Court
(2023-2024)
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An Act relative to transparency of hospital margins & ensuring hospital efficiency.
Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
of the same, as follows:
1 SECTION 1. Chapter 12C of the General Laws, as so appearing in the 2020 edition, is
2hereby amended by inserting after section 8 the following new section:-
3 8A. Reporting of Hospital Margins
4 (a) If in any fiscal year, an Acute Hospital, as defined in this chapter, reports to the center
5an operating margin that exceeds 5 percent, the center shall hold a public hearing within 60 days.
6The Acute Hospital shall submit testimony on its overall financial condition and the continued
7need to sustain an operating margin that exceeds 5 percent. The Acute Hospital shall also submit
8testimony on efforts the Acute Hospital is making to advance health care cost containment and
9health care quality improvement; and whether, and in what proportion to the total operating
10margin, the Acute Hospital will dedicate any funds to reducing health care costs. The center 2 of 3
11shall review such testimony and issue a final report on the results of the hearing. In
12implementing the requirements of this Section, the center shall utilize data collected by hospitals
13pursuant to the requirements of Section 2 of this act.
14 (b) The center for health information and analysis shall examine hospital efficiency for
15all hospitals under section 8 of chapter 12C of the General Laws by annually publishing the
16margins for hospitals for commercial, Medicare and Medicaid lines of business and utilizing data
17submitted as part of the Registered Provider Organization process to report on the underlying
18cost structure for hospitals.
19 (c) Academic medical centers shall report to the center for health information analysis
20and the health policy commission information on the portion of revenues and expenses that are
21devoted to teaching and research. The center shall annually issue a report on the case-mix of
22hospitals and the relationship of case-mix to commercial reimbursements.
23 SECTION 2. Notwithstanding any special or general law to the contrary, the center for
24health and information and analysis, in consultation with the division of insurance, shall
25promulgate regulations on or before July 1, 2023 to establish a uniform methodology for
26calculating and reporting inpatient and outpatient costs, including direct and indirect costs, for all
27hospitals under section 8 (8A) of chapter 12C of the General Laws. The center shall, as necessary
28and appropriate, promulgate regulations or amendments to its existing regulations to require
29hospitals to report cost and cost trend information in a uniform manner including, but not limited
30to, uniform methodologies for reporting the cost and cost trend for categories of direct labor,
31debt service, depreciation, advertising and marketing, bad debt, stop-loss insurance, malpractice
32insurance, health information technology, medical management, development, fundraising, 3 of 3
33research, academic costs, charitable contributions, and operating margins for all commercial
34business and for all state and federal government business, including but not limited to Medicaid,
35Medicare, insurance through the group insurance commission and federal Civilian Health and
36Medical Program of the Uniformed Services. The center shall, before adopting regulations under
37this section, consult with the group insurance commission, the Centers for Medicare and
38Medicaid Services, the attorney general, and representatives from the Massachusetts Hospital
39Association, the Massachusetts Medical Society, the Massachusetts Association of Health Plans,
40the Blue Cross and Blue Shield of Massachusetts, the Massachusetts Health Information
41Management Association, and the Massachusetts Health Data Consortium.