Study: Maine hospital costs up Association says report inaccurate

AUGUSTA – The cost of running a hospital in Maine grew at more than three times the national rate in 2002, the most recent year for which data is available, according to a study released Wednesday by the advocacy group Consumers for Affordable Health Care.

The Maine Hospital Association, however, called the study inaccurate and irresponsible. “This is literally the most irresponsible report I’ve seen in 15 years,” said MHA president Stephen Michaud. “They have picked the ultimate apples-to-oranges comparison.”

Comparing aggregate information submitted by the Maine Hospital Association to national numbers compiled by the federal government, the Consumers for Affordable Health Care study shows that costs in 2002 grew here by 10.2 percent over the previous year, while the national growth average was just 3.3 percent. The growth rate in Maine for both 2001 and 2000 was 9 percent, while the national average was 3.9 and 3.8 percent, respectively.

Despite these increased operational costs, the study shows hospitals in Maine maintaining a healthy profit compared to hospitals in other New England states and nationally, even when adjusted for treatment and wage differences. The report also indicates little or no difference in the quality of care delivered or in long-term patient outcomes.

When the cost of running a hospital goes up, said Consumers for Affordable Health Care Director Joe Ditre, the institution must either lose money or pass the costs on in the form of increased charges to insurance companies. This cost shifting in turn drives up the cost of insurance, pricing coverage out of reach for an estimated 180,000 Maine residents and their employers.

Consumers for Affordable Health Care hasn’t determined what’s making Maine’s hospitals so pricey, but Ditre said Gov. John Baldacci’s recently appointed Commission to Study Maine Hospitals will look at a number of possible causes, including excess bed capacity, overly ambitious investments in technology and facilities, and inappropriate use of costly diagnostics and treatments to recoup those investments.

Michaud countered that the report compares two different sets of figures. The MHA information, he said, reflects both the increased cost of treating patients and an increase in the number of patients treated at Maine hospitals. The national data, however, only consider the increased cost of treating patients, he said.

An analysis of comparable data, Michaud said, would show Maine hospital costs only slightly ahead of the national average. He called the report “a clear and well thought-out tactic … to hose hospitals down unfairly.”

Ditre maintained the report is accurate and fair. “Maine hospital costs are rising dramatically, at rates that are unsustainable,” he said, “especially if you’re a small business trying to afford care and coverage for your employees.”

The report “Off the Charts: Unsustainable Hospital Growth in Maine” may be found at the the Maine Hospital Association’s Web site: http://www.mainecahc.org