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July 24, 2013

My View: AGH and the 'distressed hospital' fund

Last week, the Massachusetts Health Policy Commission released preliminary information related to the so-called “Distressed Hospital Trust Fund,” as has been reported.

Addison Gilbert Hospital is among the 30 hospitals across Massachusetts that are eligible to apply for this funding. I have fielded a variety of questions and concerns about the fund, so I want to share with you what we know at this time so that you have a better understanding of what the fund is, the purpose it is intended to serve and the process to apply for a grant.

First, the name is misleading. AGH has been identified as being eligible for funding, but the hospital is not “distressed.” We qualify for the fund because the rates we receive from commercial payers (Blue Cross, Harvard Pilgrim and Tufts) are below the statewide average. We remain a vibrant, high-quality community healthcare provider. In fact, although all hospitals are challenged by today’s healthcare environment, AGH and the entire Lahey Health System remain financially stable and secure.

The “Distressed Hospital Trust Fund” fund is part of last year’s Massachusetts Health Care Cost Containment Bill – commonly referred to as Chapter 224. It aims to “level the playing field” between large academic medical centers and community hospitals, with money collected from a one-time assessment on hospitals with high payment rates and insurance providers. The fund is managed by the Health Policy Commission and is designed to support six initiatives derived from Chapter 224:

Improve and enhance the ability of community hospitals to serve populations efficiently and effectively;

Advance the adoption of health information technology;

Accelerate the ability to electronically exchange information with other community providers to ensure continuity of care for patients;

Support infrastructure investments necessary for the transition to alternative payment methodologies;

Aid in the development of care practices and other operational standards necessary as an accountable care organization;

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