Advocates say a bill that would cap how much hospitals in Maine can charge insurers for various services would make health care more affordable. Hospital executives say the measure, if passed, would result in closures and cuts to services.<\/p>\n
State Rep. Drew Gattine, D-Westbrook, the bill\u2019s sponsor, said the aim is to reduce health care costs without cutting services. He said he believes \u201crising hospital costs are contributing to the affordability crisis we are having.\u201d<\/p>\n
But Dr. Guy Hudson, Northern Light Health\u2019s president and CEO, said Maine\u2019s health care systems are financially \u201cfragile\u201d compared to those in most states.<\/p>\n
\u201cThis is not going to solve the increased cost of health care in Maine,\u201d Hudson said. \u201cIt\u2019s going to add to the problems here.\u201d<\/p>\n
The bill, LD 2196,<\/a> would cap hospital prices charged to private insurance companies at 200% of Medicare reimbursement rates. The hope is that capping what hospitals can charge insurance companies for various services would help control the premiums private insurers charge to customers.<\/p>\n But Medicare and Medicaid reimbursement rates often don\u2019t cover the actual cost of hospital services, experts say. Hospitals make up the difference by charging private insurance companies more.<\/p>\n Dr. Andy Mueller, CEO of MaineHealth, the largest health care system in Maine, said its revenue would decline by about $650 million per year if the bill passes.<\/p>\n \u201cThe only way we would survive without\u00a0becoming\u00a0insolvent is by letting go of a third of our workforce \u2014 8,000 of our 24,000 workforce would have to be cut,\u201d Mueller said. \u201cThere would be a drastic reduction in the amount of services we provide.\u201d<\/p>\n Gattine said he collaborated with the Office of Affordable Health Care, an independent agency created by the Legislature, in writing the bill. A presentation by the office to lawmakers last week noted that recent surveys showed one-third of Maine residents have skipped or delayed going to the doctor because they were worried about health care costs.<\/p>\n \u201cI think it\u2019s time we have a serious conversation about how hospitals are managing their costs,\u201d Gattine said in an interview. \u201cI see a lot of evidence that hospitals are well-off institutions that seem to be able to invest in what they want to invest in.\u201d<\/p>\n A public hearing on the bill has not yet been set.<\/p>\n Gov. Janet Mills is reviewing the bill and has not yet taken a position on it, according to her office.<\/p>\n ADVOCATES SAY COSTS ARE UNSUSTAINABLE<\/p>\n The prices hospitals charge can vary depending on which hospital a patient goes to, according to the Office of Affordable Health Care\u2019s analysis. In one example, a knee replacement at Northern Light Mercy Hospital in Portland cost $50,319, while the same surgery at MaineHealth Maine Medical Center in Portland cost $66,694.<\/p>\n Limiting outlier charges \u2014 when the cost of a procedure at one location is much more expensive than a similar procedure at another \u2014 is a goal of the legislation, said Maureen Hensley-Quinn, senior director at the National Academy of State Health Policy, a national think tank.<\/p>\n \u201cIt\u2019s trying to set a high ceiling for very high-cost claims,\u201d Hensley-Quinn said.<\/p>\n Hensley-Quinn said similar laws, if carefully crafted \u2014 such as those passed in Oregon, Indiana and Rhode Island \u2014 can help rein in costs while not harming hospitals\u2019 bottom lines.<\/p>\n She said of those three states, Indiana\u2019s law \u2014\u00a0which also caps prices that hospitals can charge insurers \u2014 is most similar to what Maine is proposing. Hospitals there don\u2019t have to comply until 2029 and there has been debate about what the law\u2019s impact on hospitals will be, according to news reports.<\/p>\n \u201cThe costs employers and individuals are seeing in their health insurance are not sustainable over the long term,\u201d Hensley-Quinn said. \u201cIf something doesn\u2019t happen to address the underlying costs of health care, more and more people will lose their health coverage.\u201d<\/p>\n Gattine said the health and human services committee will hear from all sides when it hosts a public hearing on the bill in the coming weeks. He said he\u2019s hopeful a balance can be struck.<\/p>\n \u201cYou can\u2019t lower costs without doing something to lower costs,\u201d Gattine said. \u201cWe have to figure out what the right tipping point is.\u201d\u00a0<\/p>\n HOSPITAL EXECUTIVES CONCERNED<\/p>\n Hospital executives say they are struggling under current conditions to maintain financial stability<\/a> and have had to cut services in recent years.<\/p>\n Among the cutbacks, Northern Light Health closed Inland Hospital<\/a> in Waterville in 2025, MaineGeneral Health shuttered the Edmund N. Ervin Pediatric Center<\/a> last year, and a string of maternity wards in Maine have closed over the past decade.<\/p>\n