BOSTON — Fed by a surcharge on the most asset-rich hospitals authorized under the state’s health care cost containment law, a new state commission is preparing its first offering of grants to other hospitals, with Gloucester’s Addison Gilbert among the eligible recipients.
“We have $40 million in this first year, and less than that in the years after,” said Health Policy Commission Executive Director David Seltz, discussing the four-year grant program with a commission committee. The panel is now looking into what specific types of projects the commission should back.
With the grants, one commission official said the agency could be looking to fund opportunities for “synergy” or “gap filling,” infrastructure investments or “shifts in the way health care is delivered.”
The commission released a preliminary list of 30 hospitals eligible for the grant program, including both Addison Gilbert and Beverly Hospital, though the requirements for grants will be further refined. Committee members also raised the possibility of seeking legislation to change the statutory eligibility requirements, which were whether the potential recipients are teaching hospitals, for-profit and whether the potential recipient hospitals’ prices are above average.
“I would have included their payer mix, including their Medicaid proportion,” said HPC Chairman Stuart Altman. He said, “It is an interesting mix, and I don’t have any particular hobby horse here, any particular hospital that I think should be included.”
Addison Gilbert was submitted by its new parent nonprofit corporation Lahey Health this past March at the urging of state Rep. Ann-Margaret Ferrante, and under the heading of the new grant funding being targeted for hospitals and other health care facilities that were financially “distressed.”
The self-designation raised some red flags in Cape Ann among those concerned about AGH’s long-term future, but Lahey and AGH officials emphasized the designation was a vehicle for receiving support from the new Health Policy Commission, which was created by the Legislature last year with an eye toward supporting community hospitals and leveling the health-care playing field.
The initial request for responses is scheduled to go out in October and the commission plans to notify grant recipients in November.
Seltz, a former top aide to Senate President Therese Murray who helped draft the 2012 health care law, left open the possibility that the commission might seek a change in law. The 2012 law created the HPC and the one-time $120 million assessment on certain hospitals.
“It may be that a statutory change may be necessary,” Seltz said. He said, “We would cross that bridge when we come to it.”
Last year’s cost containment law laid out a new payment platform centered on more coordinated care and its supporters predicted it would shave $200 billion off the estimated cost of health care statewide over the next 15 years, money lawmakers hope will be plowed back into the economy.
The law authorized a one-time $60 million surcharge on hospitals or hospital networks with more than $1 billion in net assets, which receive less than 50 percent of revenues from public payers.
Brigham & Women’s, Newton Wellesley and Faulkner, all from the Partners HealthCare group, and Massachusetts General Hospital all qualified for the surcharge. Children’s Hospital, Beth Israel Deaconess, Mount Auburn, New England Baptist and Martha’s Vineyard Hospital qualified for the surcharge and were granted a 50 percent discount, reducing the total surcharge by $9.2 million.
HPC Director of Quality Integration Iyah Romm said the commission can hone the list of potential grant recipients by defining what it wants, though the commission is still reviewing what steps it might be able to take to add hospitals that did not qualify.
“There is certainly the process of further evaluation refinement,” said Romm, who said hospitals’ affiliations could be taken into account.
In addition to AGH and Beverly Hospital. hospitals listed as eligible recipients as of July 10 are: Anna Jaques Hospital of Newburyport, Athol Memorial Hospital, Baystate Franklin Medical Center, Baystate Mary Lane Hospital, Beth Israel Deaconess Hospital – Milton, Beth Israel Deaconess Hospital – Needham, Beverly Hospital, Emerson Hospital, Harrington Memorial Hospital, HealthAlliance Leominster Hospital, Heywood Hospital, Holyoke Medical Center, Jordan Hospital.
Also, Lawrence General Hospital, Lawrence Memorial Hospital, Lowell General Hospital, Marlborough Hospital, Melrose Wakefield Hospital, Mercy Medical Center, Milford Regional Medical Center, New England Baptist Hospital, Noble Hospital, Saints Medical Center, Signature Brockton Hospital, Southcoast Charlton Hospital, Southcoast St. Luke’s Hospital, Southcoast Tobey Hospital, Winchester Hospital, and Wing Memorial Hospital.