What’s happening: On Feb. 25, the Office of Health Care Affordability (OHCA) board indicated general support for a formal proposal to impose reduced sector spending targets of 1.6% to 1.8% on 11 hospitals. However, a formal decision is not expected until April or May, following the conclusion of a 45-day public comment period on April 11
What else to know: In written and verbal comments, CHA voiced strong opposition to these proposed targets, noting that they not only come three full years before statutorily required, but are also deeply flawed, as they ignore critical factors relevant to understanding California’s hospitals.
OHCA proposes to adopt reduced spending targets for these 11 hospitals:
The board is poised to formally adopt the proposal, potentially in modified form, at either the April or May board meeting.
The sector spending target values are largely unchanged from the option presented at the Jan. 28 board meeting — but the proposed set of hospitals subject to the reduced targets has changed primarily because OHCA:
- No longer seeks to exclude smaller hospitals
- Now restricts its delineation to the top 15% of all hospitals that have complete and comparable data on two measures: hospitals’ commercial inpatient unit prices and a measure of degree to which their commercial payments cover their costs better than their Medicare payments do
Previously, OHCA looked at the top 20% of hospitals on these same measures.
Earlier this month, CHA also submitted comments on OHCA’s proposed approach for measuring quality and equity in California’s health care system.
For more information, please visit CHA’s OHCA web page or contact Ben Johnson, group vice president, financial policy.
