Palin promotes health care bill

Posted: Thursday, January 24, 2008

Gov. Sarah Palin campaigned for office promising more transparency and openness in state government. Now she's pitching transparency, openness and competition as a solution for rising health care costs as in Alaska.

A task force set up by the governor spent the summer looking at health care issues in Alaska and concluded that consumers needed more information to be able to compare costs.

Palin last week introduced the Alaska Health Care Transparency Act to provide consumers with factual information on quality, cost and similar matters, provided by a new health care information office.

At the same time, Palin is proposing elimination of the Alaska's Certificate of Need process, likely to be much more controversial in health care circles.

The certificate is required if a business, such as an imaging center or emergency-care clinic, wants to set up a health service to compete with a hospital. The business must prove there's a community need to receive the certificate, which basically limits competition in health care.

Bartlett Regional Hospital in Juneau is opposed to repealing the certification process, CEO Shawn Morrow said.

"I respect our governor very much, but we would definitely be opposed to a repeal of the CON," Morrow said.

The House version of Palin's bill, HB 337, is scheduled to be heard Thursday and the Senate version, SB 245, will be heard Friday, in the respective Health, Education and Social Service committees.

Rep. Berta Gardner, D-Anchorage, supports what Palin is trying to do with transparency.

"It's not a magic bullet that is going to fix everything for everybody, but it's a step in the right direction, she said.

Gardner is working on a bill to require health care providers tell people up front what procedures are going to cost.

"I've personally found stories from people who have had a very hard time ahead of time figuring out what things were going to cost, and then after the fact the bills just kept coming."

Gardner described her bill as "kinda going in the same direction" as Palin's.

Sen. Fred Dyson, R-Eagle River, has introduced Senate Bill 29 to require the Department of Heath and Social Services to create a Web site comparing health care cost information.

Palin's plan to repeal the Certificate of Need is likely to be bitterly opposed by the state's hospitals, but the governor said it was part of reducing health care costs in Alaska.

"Under our present Certificate of Need process, costs and needs don't drive health care choices - bureaucracy does," said Palin, in her State of the State address to the Legislature on the first day of the session.

Palin called the CON system "broken and expensive." She said it was causing lawsuits and needed to be eliminated.

"Alaskans want health care in the hands of doctors, not lobbyists and lawyers," she said.

Palin's proposal has upset some hospitals. Mat-Su Regional Medical Center CEO Norman Stephens said allowing more competition sounds at first like it would lower costs but in practice it can do just the opposite and can cripple struggling hospitals.

Hospitals are required to serve everyone who comes to an emergency room, he said, only inquiring about whether that service will be paid for after the fact.

Only a few of a dozen or more departments in a typical hospital make money, and if those operations can't make up for the care that is not paid for, someone else will have to, he said.

Morrow said Bartlett's $60 million budget typically includes $1 million in charity care and $6 million in bad debt every year.

Everyone who arrives at the emergency room is cared for first cared for, and then payment is later sought, he said.

"We're not like a hardware store, where you have to pay before you leave," Morrow said.

Losing a profitable business such as imaging to independent competitors will leave too little profit to support money-losing services such as emergency care, Stephens said.

"These boutique operators get themselves rich by skimming the cream off the system," Stephens said.

Rep. Bob Lynn, R-Anchorage, praised Palin's call for doing away with the Certificates of Need.

As far as I'm concerned, a better name for the CON is a "Certificate of Monopoly."

Sen. Donny Olson, D-Nome, the only physician in the Legislature, said it may do more to restrain competition than it does to reduce costs.

"I think it was a very good program when it was started 20 to 30 years ago, but I think its day has gone by," he said.

There may still be room for a limited version of the Certificate of Need in some rural communities, he said, and he'd be willing to look at modifying or repealing the requirements.

• Contact reporter Pat Forgey at 586-4816 or

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