Hospital leaders frustrated at failed health care talks

The lobby at Brockton Hospital, which is owned by parent company Signature Healthcare.David L. Ryan/Globe Staff

Frustrated hospital leaders say they will continue pushing for legislation to help struggling community hospitals after Massachusetts lawmakers failed in their last-ditch attempt to find consensus on a sweeping health care bill this week.

Spiros Hatiras, chief executive of Holyoke Medical Center, said he was in disbelief that lawmakers ended their formal sessions without approving a health care bill. “After all that was said, after all the discussions — to come up with nothing?” he said.

Hatiras said he and other Holyoke Medical executives now must decide whether to cut programs because of tight finances. “The only thing you can do in a situation like this is close services,” he said.

Kim Hollon, chief executive of Brockton Hospital’s parent company, Signature Healthcare, said he was “extremely disappointed” that legislators failed to pass a bill.

“This issue didn’t go away,” he said. “We just kicked the can. We’ll be back at it.”

Community hospitals have long argued that they are underpaid by insurers because they lack the market power of big teaching hospitals. Both the Senate and the House sought to address this issue, but in different ways.

A bill approved by the House in June charged new assessments on insurers and large hospitals, funneling more than $330 million back to community hospitals. Walk-in clinics and surgery centers also would have paid new fees under the House bill.

The Senate bill, passed in November, set a “rate floor” for insurance payments, mandating that hospitals be paid at least 90 percent of the average price of a medical service. The legislation would have charged hefty fines to large hospitals — such as those owned by Partners HealthCare — if spending grew too fast.

Senators said their bill would have reined in health care costs, while House leaders said their bill was aimed primarily at boosting community hospitals.

Both bills ran into opposition from various business and health care industry groups who argued the proposals would raise costs.

For weeks, House and Senate members held secret talks to hash out a compromise. They were still exchanging proposals Tuesday, hours before their deadline. A deal appeared to be on the horizon at one point, according to people familiar with the talks.

But around 11 p.m. Tuesday, lawmakers abandoned their negotiations and said their “philosophies” were too different to reconcile.

Senate President Karen E. Spilka said senators will begin work on another health care bill when they reconvene next session. “I hope the House takes it up and gets it done, and we can start meeting a little earlier in the session,” she said Wednesday.

Hatiras, the Holyoke Medical Center CEO, blamed health insurers and Partners, the state’s most powerful hospital system, for trying to thwart a compromise bill.

Partners has fought hard against the Senate’s version of health care legislation. Leaders of Partners’ largest hospitals, Massachusetts General and Brigham and Women’s, went to Beacon Hill to argue that the legislation was damaging and unfair. (Partners was more supportive of the House’s approach.)

Partners officials denied that they tried to kill a final bill and said they were disappointed that lawmakers didn’t reach a deal.

“We have long supported fair and balanced approaches that get community hospitals the targeted resources they need,” Partners spokesman Rich Copp said in a statement. “We look forward to working with all stakeholders during the next session to revisit these issues.”

Steve Walsh, chief executive of the Massachusetts Health & Hospital Association, also said it was unfortunate that legislators couldn’t find a compromise.

“To best protect patients across the Commonwealth, it is imperative that we stabilize our high-value community providers and ensure their long-term viability,” he said in a statement. “Although a resolution was not reached, we know for certain by the efforts of both the House and Senate that they share this common goal and we look forward to continuing our collaborative efforts.”

The consumer advocacy group Health Care For All called the Legislature’s failure to pass a health care bill “a missed opportunity.”

But insurers and employers — who lobbied against the bills because of concerns about costs — expressed relief at the legislation’s demise.

“I think the best result is that no bill emerged — unless they dealt rationally with those provisions and ensured they didn’t increase costs,” said Lora M. Pellegrini, chief executive of the Massachusetts Association of Health Plans.

James E. Rooney, chief executive of the Greater Boston Chamber of Commerce, said it wasn’t surprising that the bill didn’t make it past the finish line. “Negotiating consensus on such complex issues is always a challenge,” he said in a statement.

Dr. Alain Chaoui, president of the Massachusetts Medical Society, said in a statement that he looked forward to working with lawmakers in the next session to craft legislation that promotes “the highest value settings of care.” The medical society opposed a House provision to impose new fees on surgery centers, saying it was too costly and would have forced physicians offices to stop performing certain services.

Officials at the North East Regional Urgent Care Association, a trade group, said they were pleased that lawmakers failed to approve a bill with “unprecedented taxes” on urgent care centers. They said the House bill would have devastated the urgent care industry.

Also dying with the health care legislation this week was a measure to allow midlevel dental providers called dental therapists to treat patients in Massachusetts. The now-defunct House and Senate bills also included several other provisions on telehealth, out-of-network medical bills, prescription drug costs, and more.

Massachusetts passed a landmark health care law in 2006 to expand insurance coverage to nearly all residents. In 2012, the state approved a law that set an annual target for statewide health spending and took other steps to curb costs.

“There always seems to be health care legislation pending on Beacon Hill,” said Richard C. Lord, president of Associated Industries of Massachusetts, a business group. “I’m sure we will back at it.”