New rules to curb free care criticized

New state rules that would restrict the availability of free care at hospitals and community health centers could weaken the state's health safety net, according to government officials, healthcare providers, and advocates speaking at a public hearing or offering written testimony yesterday.

Proposed deductibles and copayments are likely to scare some needy patients away, they said, while proposed limits on eligibility could financially hurt hospitals and community health centers that serve uninsured patients who can't afford to pay.

"The continuity of their health care will come at our expense," said Joel Abrams, chief executive of Dorchester House community health center. "I ask you to help avoid tearing apart . . . the community-based safety net system."

The rules, which are scheduled to take effect Oct. 1, are part of the state's effort to push nearly everyone in Massachusetts to get health insurance. To fund subsidized coverage for low-income people, the state is drawing on money previously used to pay for free care at hospitals and health centers, so the state needs to reduce payments for free care in the long run.

Last month the state said it planned to stop reimbursing hospitals and health centers for care provided to patients who are eligible for insurance through the state Medicaid program, the state-subsidized Commonwealth Care, or affordable coverage through their work. The new rules would require all but the lowest-income patients seeking free care to make small copayments for hospital visits and patients earning slightly more to pay deductibles of $35 a month. These fees are comparable to what people would pay for Commonwealth Care insurance, although the free-care system does not provide the same comprehensive coverage.

Business leaders praised the proposed rules yesterday as consistent with the goals of the state's health insurance initiative.

"You've struck the right balance" between providing a safety net and encouraging enrollment in insurance, said Michael Widmer, president of the Massachusetts Taxpayers Foundation, a business-funded financial watchdog.

But others said that collecting the new deductibles would be a bureaucratic nightmare since one hospital would not know if a patient had paid the monthly fee at another facility. If patients were unable to pay, hospitals and health centers would be stuck with the bill, because they do not intend to turn away sick people, health providers said.

Ellen Murphy Meehan, a spokeswoman for a group of urban hospitals called the Alliance of Massachusetts Safety Net Hospitals, estimated that facilities would only be able to collect about 10 percent of the deductibles and fees from patients.

In written testimony, state Senator Richard T. Moore, an architect of the health reform law, said "what must be avoided is placing more of a burden on the hospitals and inadvertently discouraging patients from seeking medical care."

After the hearing, Sarah Iselin, state commissioner of healthcare finance and policy, said Massachusetts would maintain comprehensive health coverage for people who can't afford care but would move forward with needed changes in the free care system.

"We recognize, and the proposal reflects, our commitment that there will continue to be a strong safety net," said Iselin, whose office oversees free care. "But we need to align this with other state health programs, so people who have access to affordable coverage enroll."

Iselin said state officials would consider public concern before issuing final rules in mid-September. Once new rules are in effect, she said, her office would closely monitor the impact on patients and on healthcare providers.