In the perpetual game of whack-a-mole where the aim is to debunk nasty myths about hospitals that keep popping up just about everywhere you look, yet another mole poked out its head last week in CalMatters.
A commentary written by the California director for the Small Business Majority, “Hospitals’ opaque pricing is crushing California’s small businesses,” is filled with misleading statements and accusations but is short on facts and thoughtful solutions.
In our response to the commentary, CHA makes clear that the primary forces driving up costs in health care are beyond hospitals’ control, and that insurance companies — which raked in tens of billions of dollars in profit last year — are actually the organizations that decide what small businesses and their employees pay in premiums, deductibles, and copays.
It’s unclear if CHA’s submission will be published by CalMatters, but if it is not, we will look elsewhere to ensure our perspective is surfaced and policymakers are aware of the key points:
- There is no “pricing abuse” on the part of hospitals. They must invest to meet stringent seismic building standards, absorb skyrocketing labor and supply costs, and care for patients covered by Medi-Cal and Medicare — which reimburse far below actual costs — along with increasing numbers of Californians who, unfortunately, have no coverage at all.
- Hospitals are required by law to publish thousands of negotiated rates and offer online tools to help patients estimate out-of-pocket costs.
- Facility fees are not arbitrary surcharges. They reflect the added cost of care in a hospital — the most complex, resource-intensive, and tightly regulated setting.
- Hospitals attempting to contract with insurance companies is like David facing Goliath, where a 25-bed, independent hospital is trying to make a deal with a national insurance corporation with hundreds of billions of dollars in annual revenues, armies of lawyers, and often a monopoly within the local insurance market.
The most important point, one that must be made time and again when this game is played, is that unlike the corporations that provide health insurance, hospitals are far more than what shows up on a balance sheet. They are the places where babies are born, cancers are treated, hearts beat again, and those with mental health and substance use disorders get critical services. They support hundreds of thousands of jobs and sustain local economies.
That’s why, when choosing between spending more on health care or reducing access, Californians choose time and again to have care available when they need it — 24 hours a day, 365 days a year.
