HEALTH FEE REGULATION PROMOTED WILDER: ASSEMBLY MUST CLAMP DOWN ON HOSPITALS

                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: THURSDAY, January 16, 1992                   TAG: 9201160370
SECTION: VIRGINIA                    PAGE: B1   EDITION: METRO 
SOURCE: THOMAS BOYER STAFF WRITER
DATELINE: RICHMOND                                LENGTH: Medium
HEALTH FEE REGULATION PROMOTED WILDER: ASSEMBLY MUST CLAMP DOWN ON HOSPITALS
Gov. Douglas Wilder, promising to "face down as many expensive lobbyists as the health-care community can muster" called Wednesday for sweeping new laws that would regulate hospital charges just like electric rates.
In a populist-style speech attacking record hospital profits, Wilder said the General Assembly must clamp down on the industry or send voters the message that "once again, big money has won out over the people."
He also said he would tour the state, making speeches and meeting with community leaders to drum up grass-roots support for his planned $34-million-a-year tax on health-care providers to help pay the state's $1 billion Medicaid bill.
Hospitals have fought the tax, saying they would pass it on to patients and insurance companies in the form of higher rates. But Wilder said he would try to make that a crime.
The hospitals could absorb the cost of the tax, he said, by cutting their expenses by one-half of one percent - a pittance compared to the 15 percent and 25 percent cuts absorbed by many state agencies.
"Think of that, one-half of 1 percent," Wilder said, holding his thumb and forefinger less than an inch apart as he stood before a legislative panel. "And they say, `Oooooh, we can't do that!' "
Wilder, who only last week had his attention fastened on presidential primaries in New Hampshire and Maryland, gave every impression of a governor hungry for a legislative victory back home.
"We want this one," said his press secretary, Glenn Davidson. "And this is the right one."
Laurens Sartoris, president of the Virginia Hospital Association, which represents 120 institutions, was subdued after watching the speech. "I'm going to look at the governor's options," he said, smiling slightly. "I'm sure many of them have merit, and I'd suggest some might need some attention."
"When people talk about the problem with health care, they talk about two things: cost and access," said Patti G. Forrester, a spokeswoman for Norfolk-based Sentara Health Systems. "This proposed tax will raise health-care costs and we don't see that it does anything to increase access.
"We continue to believe that health care for the poor is a responsibility for society and not just health-care providers alone," Forrester said. "Taxing hospitals is a short-term solution which delays facing a real solution to the societal problem."
Hospitals have said the Medicaid program, which serves the poor and elderly, should be paid for out of general tax revenues. Taxing hospitals for the program amounts to taxing people who pay hospital bills, they charge.
"They've dubbed our proposal a `sick tax,' " Wilder responded. "The only thing sick about this idea is how the provider community can talk of a general tax increase when - I repeat - they will make more than three-quarters of a billion dollars in profit in the next two years."
Wilder proposed:
Expanding the powers of the state Health Service Cost Review Council to allow the agency to regulate hospital and doctor charges. "If state government - and in reality its taxpayers - are going to be expected to pick up the tab . . . the taxpayers should have a greater say in how much health-care costs can increase," he said.
Reinstating state control over purchases of expensive equipment, such as scanners and X-ray machines. Such controls were abolished in the 1980s, and since then the use of such machines has taken off - accompanied by higher rates.
A statewide "health summit" this summer, bringing business and consumer groups together with health-care providers to discuss long-term solutions.
Studying the state tax exemption for non-profit health-care facilities; one "non-profit" hospital in Fairfax turned a $31 million profit last year, state officials say.
Allowing insurance companies more leeway to deal only with cost-efficient hospitals and doctors.

by Archana Subramaniam by CNB