Op Ed from Representatives of Delaware’s Public Sector Workforce
For the last decade, experts from Delaware and around the country have sounded the alarm that hospital prices in Delaware are unsustainable and out-of-control. As representatives of Delaware’s public sector workforce, we have seen the impact rising healthcare costs have on working families we represent. Every year, more and more of their household budgets are absorbed by the cost of healthcare. This trend is both unsustainable and unfair to hardworking Delawareans.
In 2015, the State Employees Health Plan Task Force, formed by the General Assembly, issued a report finding that hospital costs in Delaware were higher than surrounding states. Again in 2020, the Johns Hopkins Bloomberg School of Health presented evidence on the pricing problem to the State Employee Benefits Committee. They found that the price of inpatient healthcare services in Delaware was 240% higher than Medicare prices. Again in 2023, the Delaware Department of Insurance’s Office of Value-Based Healthcare Delivery reported that outpatient pricing was 369% higher than Medicare rates and inpatient pricing rose to 281%.
These prices have continued to grow and have now reached a point where consumers are having to pay more for their benefits and their care than ever before. How exactly does this impact hardworking Delawareans?
For high-tech imaging services, like an MRI, an outpatient visit to the hospital will cost a Delawarean about $1,900, on average, according to a 2022 Willis Towers Watson report. The very same service at a freestanding, nonhospital-affiliated facility costs around $470. That equals a roughly 300% difference in price.
Delaware families face rising costs in every aspect of their lives these days, and the cost of healthcare has simply become unsustainable. The average Delawarean spends 29.1% of their annual income on healthcare. There is overwhelming evidence proving that Delaware residents are paying more than they should for healthcare. In 2023, experts found that Delaware commercial hospital prices are among the highest in the nation.
Employers are also paying more in health insurance premiums than the national average. And these costs are passed down to the employees from the employers most of the time. This often results in smaller to no compensation increases, having to pay more for their benefits, and taking home even less money each month. Additionally, out-of-pocket medical expenses they incur quickly add up, especially when they or their family members face life-threatening illnesses. No Delawarean should be having to choose between feeding their family and medical costs.
House Substitute 1 for House Bill 350, championed by Speaker Valerie Longhurst and Majority Leader Bryan Townsend, will bring much needed financial relief to Delaware families. The legislation would create the Diamond Sate Hospital Cost Review Board, a board of experts charged with reviewing hospital budgets and approving them considering a wide range of factors. Hospitals would still craft their own budgets, but the board would provide much needed transparency and accountability to ensure budgets are focused on patient care and not excessive profits.
States that have implemented this cost review approach have seen real savings for residents. When Vermont put a cost review board in place, they helped save residents over $108 million. After years and years of sounding the alarm, the time to act is now. Delaware families deserve affordable and transparent healthcare pricing.
State workers are standing united on this issue. Not only for our members, but for working families up and down the state of Delaware. We hope you can join us by letting your State Legislators know you support HS 1 to HB 350.
