A Centerpiece Of Bay State Life Is Eroding Health Care Funding Is A Key Component To Quality Of Life

Quality of life is critical to the future of any community. If people like the quality of life, they will stay, others will want to join in, and the economic resources and vitality of the community tend to grow. If that quality of life is declining, people migrate away, taking with them a piece of the community and making it more difficult for those who remain.

Magazines now rank quality of life nationally, helping people find the right place for relocation — and the Pioneer Valley is getting its share of positive recognition. For example, Money magazine has identified Amherst as among the top 10 places to retire, and Northampton has been identified by Parent magazine as a top-10 place to raise children.

What really matters in establishing and building quality of life? The fundamental building blocks are access to quality health care, the education system, and public safety. Other attributes may vary, such as the tourism draw of the Basketball Hall of Fame, the Connecticut River, or the artistic focus that has helped Northampton rank as a top small arts town in the nation. But the critical three must be in place before other factors come into play.

In recent years, the Commonwealth recognized that K-12 education was underfunded, and the state responded by increasing investment in public schools.

egardless of public reaction to the MCAS exams as a means of assessing student performance, there is no question that testing and additional funding are part of a focus on improving education. Regarding public safety, recent statewide reports indicate declines in the incidence of some of the most violent crimes, suggesting improvement in this area.

But these areas don’t get or stay strong without attention. Massachusetts has historically been blessed with the best-regarded health care in the nation. Unfortunately, our health system has been woefully underfunded, to the point where this once-proud centerpiece of Massachusetts life is eroding. Hospital capacity has dwindled below the number of patients who need care, nursing homes are in bankruptcy, home care agencies have closed or merged with hospitals in order to survive, and physicians are leaving the state. When other parts of the system fail, hospitals are the safety net — even if hospitals themselves are ailing.

It’s been noted often (and correctly) that Massachusetts is the only state in the nation where all three major payers fund below the cost of hospital care. This explains why more than 50{06cf2b9696b159f874511d23dbc893eb1ac83014175ed30550cfff22781411e5} of hospitals are losing money each year, and why 25{06cf2b9696b159f874511d23dbc893eb1ac83014175ed30550cfff22781411e5} of our hospitals have closed in the past 10 years.

Since Medicare is a national program, the differences in payments from state government and the private sector explain why health care is failing faster in Massachusetts than elsewhere. State support for Medicaid and uncompensated care is woefully inadequate, and HMOs are not covering the cost of care for their enrollees. Given this situation, proposed cutbacks for Medicare will, if left unabated, hasten the dismantling of Massachusetts health care ahead of the rest of the nation.

The Commonwealth’s economic problems are significant. However, there are potential sources of revenue that could be tapped to help stabilize our health care system, including a delay in the rollback of state income taxes, money from the tobacco settlement, and new cigarette taxes. The cigarette funds should presumably focus on health care, which has experienced the economic cost of tobacco-related illnesses. Thus, proposals to increase cigarette taxes are also aimed at decreasing usage.

The state must also use its accumulated reserves to address the short-term budget shortfall. Ironically, these reserves were made possible in part by years of public underpayments to health care providers. Recognizing that the state is paying 70{06cf2b9696b159f874511d23dbc893eb1ac83014175ed30550cfff22781411e5} of cost for Medicaid patients and less than one-third of the cost of care for the uninsured, lawmakers are beginning to acknowledge that the accumulated surplus was built by underpaying, in fact eroding, our care system.

At the private level, hospitals in most states receive more than their cost for patient care, enabling them to subsidize the (somewhat smaller) state shortfalls for Medicaid and the uninsured. Here In Massachusetts, private insurers pay, on average, below cost.

Some say that the average cost of care in Massachusetts is higher than in other states and that the hospitals need to fix this. But this ignores the fact that the Bay State’s wages and cost of living are high relative to the rest of the country. In the real world, the state’s hospitals, like other employers, must pay the higher compensation necessary to attract needed workers. Unless we reinvest in our health care system, we will watch further departures of the nurses, physicians, and other care providers necessary to serve patients. So the private sector will need to help support health care in our state, just as occurs elsewhere.

State budget choices come at a critical time. We have too few hospital beds, too few nurses, and critical gaps in certain physician specialties. Meanwhile, our population is aging, and seniors will require greater amounts of hospital beds.

There is no question that the state is facing some tough economic hurdles. It would be simple to spread the state’s shortfalls across all public expenditures. But priorities have to be set. Massachusetts recognized the impact of the deteriorating education system, and recent progress should not be disrupted. And we need to assure continued improvement in public safety, including any lessons learned from 9/11. The state’s leadership now recognizes that another building block, health care, has been eroded and has to be supported if we are to stave off further deterioration and closures and keep our nurses and other care practitioners here.

The public and private sectors must, together, embrace a set of priorities and work toward a compelling, appropriate vision for the future of our state. Quality of life must be at the center of those priorities. Health care, education, and public safety agencies need appropriate support.

These areas also have a responsibility to be accountable for their systems and to work in partnership with local leaders to identify and meet community needs. It is time for the Commonwealth and the private sector to clearly signal that the basics must work before we can spread resources too far in other areas. This year’s state budget allocations will not only send those signals, they will also set the path toward either improvement or deterioration in the quality of life in Massachusetts.

Craig Melin is president and CEO of Cooley Dickinson Hospital.

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