Hearing on legislation aimed at preserving access to essential health care services in response to hospital executives closing 40+ hospitals and hospital services since 2009 – all of which were deemed necessary to protect the health of those communities
Hospital financial transparency bill would limit CEO pay and help the state address the conditions underlying our nursing crisis to ensure safe patient care
BOSTON, Mass – The dangerous trend of hospital corporations choosing profits over safe and accessible patient care will come under scrutiny during a June 20 State House hearing when lawmakers hear from nurses, community members and other advocates about legislation aimed at overhauling the Commonwealth’s essential health service closure process.
We have increasingly seen shuttered emergency departments, and closures of everything from ICUs to pediatric, maternity, behavioral health and addiction treatment programs from Western Mass to Cape Cod – all closed despite overwhelming community opposition and after the Department of Public Health deemed those services essential to protecting the public health of those communities.
Legislators will also hear testimony about a bill that would shine the light on hospital finances and financial holdings, including hundreds of millions stashed in offshore tax havens, while limiting CEO pay – shinning the light on misguided effort at profit taking by hospital executives, while depriving communities of safe care and needed services.
Legislative Hearing Details
What: Joint Committee on Health Care Financing hearing on An Act Relative to The Closing of Hospital Essential Services (S.736/H.1175), sponsored by Senator Julian Cyr and Representative Ed Coppinger, and An Act Relative to Hospital Profit Transparency and Fairness (S.790/H.1179), sponsored by Senator Michael Moore and Representative Josh Cutler.
When: Tuesday, June 20, 10 a.m. to 1 p.m.
Where: Room A-1, State House, Boston. Virtual hearing access for media/public: https://malegislature.gov/Events/Hearings/Detail/4568. Link will go live for the video shortly before the hearing.
Who: Nurses, physicians, community members, healthcare advocates and experts will be testifying about closures impacting a variety of communities. This will include a busload of caregivers and community members from Leominster who will be attending in hopes of saving the Birthing Center at Leominster Hospital, which is slated for closure by UMass Memorial Health in September. Editor’s Note: The bus will be leaving from the Congregation Agudat Achim Synagogue parking lot at 268 Washington St. in Leominster at 8 a.m. should local media wish to interview participants prior to heading to Boston.
Strengthening Hospital Closure Law
The hearing comes amid a healthcare crisis in Massachusetts created by hospital corporations prioritizing financial gain over patient safety and care access for years before and during the COVID-19 pandemic. Understaffing is causing nurses to flee the bedside and entire communities such as Leominster and Taunton are threatened by maternity and addiction treatment closures.
Since 2009, more than 40 hospitals or units have closed in Massachusetts, according to areview of public records. In most cases, they closed even though the Department of Public Health examined the closure's impact and deemed the services “necessary for preserving access and health status in a particular service area.” That Massachusetts has an extensive record of closures despite DPH recommending against them speaks to the urgent need to strengthen our public health laws.
“Current Massachusetts law is failing to meet this moment of crisis for patients and their caregivers,” said MNA President and ICU nurse Katie Murphy. “Access to essential services has declined across the Commonwealth because our healthcare system follows a corporate, profit-driven Wall Street model and our state has limited powers to ensure patients can receive necessary care.
“We need to re-center patients as the most important part of our healthcare system rather than profits,” Murphy said. “We must ensure mothers and babies, people suffering from mental health or substance use issues, and all our most vulnerable residents are able to access the care they need.”
A powerful coalition of nurses, healthcare professionals, patients, community members and elected officials quickly joined together following the announcement last month by UMass Memorial Health that it intended to close the Birthing Center located at UMass Memorial HealthAlliance-Clinton Hospital’s Leominster Hospital Campus. The coalition held a rally and lawmakers called on UMass to stop the closure and negotiate.
Earlier this month, the DPH found that the 32-bed MORCAP (Morton Comprehensive Addiction Program), located at Steward Morton Hospital in Taunton, is an essential service “necessary for preserving access and health status within the hospital’s service area.” The finding followed strong opposition and extensive testimony from local public officials, nurses, addiction treatment and community advocates who testified during a required public hearing that the closure will only add to a growing crisis in the region, as local hospital emergency departments are already overburdened with patients waiting for addiction treatment beds and services.
MNA President Murphy called the DPH’s finding and its call for a plan from Steward an “empty exercise” because the department has no ability to require the treatment service to remain open. State Senator Marc Pacheco, who represents Taunton and other communities served by MORCAP, submitted scathing written testimony critical of the process, stating in part: “If the Department or Division officially finds services to be ‘essential,’ and then does nothing to prevent those services from being eliminated, then I respectfully submit that our current classification system has no actual value or purpose.”
In response to these proposed closures and the long history of shuttered services reducing or eliminating access to essential healthcare despite DPH hearings and findings, the MNA has worked with its legislative partners to propose a bill that would give the DPH, Attorney General, and the public more tools to hold hospitals accountable for closures.
An Act Relative to the Closing of Hospital Essential Services would:
- Extend the official notice period to the DPH in advance of a closure or discontinuation of health services.
- Require any hospital proposing closure or discontinuation of health services to provide evidence of having notified and provided the opportunity for comment from affected municipalities before the notification period begins.
- Instruct the Attorney General to seek an injunction to maintain the essential services for the duration of the notice period.
- Prohibit the hospital from eligibility for an application for licensure or expansion for a period of three years from the date the service is discontinued, or until the essential health service is restored, or until such time as the DPH is satisfied with a modified plan.
- Prohibit the closure of beds, units, or facilities during any declared state of emergency pertaining to health care.
“We are proud as nurses and healthcare professionals to stand up for our patients and their access to care – however, it is the weakness of our current essential services law that requires caregivers and communities to fight so hard against closures,” Murphy said. “The Department of Public Health is toothless when it comes to halting a hospital closure, even when it goes through a hearing process and determines the services are necessary.”
According to a White Paper on maternal services in Massachusetts published by MNA’s Congress on Nursing Practice, the decision by UMass to close its Leominster maternity service follows a trend by other healthcare corporations in the state to close vital community-based programs and services as a means of funneling their patients to larger and more profitable major medical centers.
Maternity services have been a specific target for these closures, creating what the March of Dimes has characterized as “maternity deserts,” meaning regions where residents lack appropriate access to needed maternity care, particularly for those serving poorer communities and people of color. Last year a Special Legislative Commission on Racial Inequalities in Maternal Health in Massachusetts issued a report showing how racial minorities are negatively impacted by inequitable policies and practices, including lack of access to appropriate maternal care. In the last decade, Massachusetts has seen the loss of at least 10 maternity units, each of which was evaluated by DPH and deemed essential to preserving the health of those communities. Below is a map detailing those closures.
Hospital Financial Transparency and CEO Pay
MNA nurses and healthcare professionals will also testify on June 20 about the harm inflicted by a system that prioritizes corporate profits above safe patient care and access to essential healthcare services.
“Healthcare disparities are worsening because our system unequally distributes financial resources, leaving behind the disadvantaged and most vulnerable while allowing huge corporations to profit and give executives millions,” said MNA President Murphy. “Requiring greater financial transparency and clawing back excessive CEO pay will help us re-center our priorities on ensuring safe and accessible patient care.”
The Hospital Profit Transparency and Fairness Act would:
- This bill would require hospitals to be transparent about their financial holdings and other activities.
- It would assess any hospital receiving taxpayer dollars that has an annual operating margin above a specific, predetermined cap.
- It would also assess any hospital receiving taxpayer dollars that provides a compensation package for its CEO that is greater than 100 times that of the hospital's lowest paid employee.
- These assessments would be deposited in a newly created Medicaid Reimbursement Enhancement Fund to increase Medicaid reimbursement rates to eligible hospitals.
- This would limit excessive CEO salaries and limit and claw back excess profits to ensure that taxpayer dollars are dedicated exclusively to safe patient care and necessary services for all communities in the Commonwealth.
Most hospitals in Massachusetts receive at least half their revenues from tax dollars, including Medicare, Medicaid, taxpayer funded grants, loans, subsidies, and waivers on local, state, and federal taxes. Yet legislators and voters are largely in the dark about the nature and scope of hospital financial holdings, including how much money hospitals store in offshore accounts or why hospitals don’t keep their excess funds in Massachusetts’ banks.
A review of financial holdings in 2019 showed that hospital corporations across Massachusetts had placed at least $1.6 billion in the Cayman Islands and other well-known offshore tax havens. Rather than use this money for safe staffing or preserving essential services, the corporations kept it in a place where there are far less restrictions on its use. When the pandemic hit, many of these same hospitals cried poor, laid off or furloughed workers, and further cut staffing levels.
At the same time, hospital CEOs in Massachusetts are often paid excessive salary packages that bear no relationship to the quality of care and patient outcomes like readmission rates and infection rates, where our hospitals rank among the worst in the nation. As the Boston Business Journal reported last year, many Massachusetts hospital executives saw their pay rise during the height of the pandemic – including executives at Mass General Brigham, Beth Israel Lahey Health, UMass Memorial Health Care, Boston Medical Center, and Dana-Farber Cancer Institute – even as some of them froze worker pay and retirement benefits.
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Founded in 1903, the Massachusetts Nurses Association is the largest union of registered nurses in the Commonwealth of Massachusetts. Its 25,000 members advance the nursing profession by fostering high standards of nursing practice, promoting the economic and general welfare of nurses in the workplace, projecting a positive and realistic view of nursing, and by lobbying the Legislature and regulatory agencies on healthcare issues affecting nurses and the public.
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