By Father Bill Pomerleau

Observer, Springfield (MA) Diocese, May 26, 2000, at 9.

BOSTON - The Sisters of Providence Health System scored a key victory on Beacon Hill last week when a key legislative committee approved a measure that would open the system to the Health New England (HNE) HMO.

The 5-2 vote by the legislature's joint Insurance Committee followed a parade of testimony from western Massachusetts religious and labor leaders,businesspeople and legislators who testified in favor of Senate Bill 2188.

The legislation, which could be debated by the full State Senate in early June before being discussed in the House of Representatives, requires that any HMO that is at least 40 percent owned by an acute care hospital must offer a contract to any non-network hospital within the same city as thecontrolling hospital.

If passed, the bill would enable HNE members to receive services at Mercy Hospital in Springfield and Providence Hospital in Holyoke, which is now a specialized facility corporately linked to Mercy.

Wing Memorial in Palmer would become the only hospital in western Massachusetts closed to HNE subscribers.

"I am not an expert on hospital finances on insurance. So when this matter first came to my attention, I and other local legislators tried to get all three parties together to give Mercy the opportunity to serve these patients," said Springfield Bishop Thomas Dupre.

"Months of meetings were unsuccessful. Then, and only then, did we turn to government for relief and assistance," he told the committee.

The bishop's first solo appearance on Beacon Hill added some drama to the proceedings of the committee, which is co-chaired by Rep. Nancy Flavin, (D-Easthampton) and Sen. Robert Bernstein (D-Worcester).

But legislators and healthcare lobbyists who periodically entered the four-hour hearing were more impressed with the array of sometimes competing forces in western Massachusetts that want the legislature to give immediate relief to the SPHS' mounting financial problems.

Member unions of the Pioneer Valley AFL-CIO have had periodic disputes with the SP Health System in recent years, including criticism of the way the system converted Providence Hospital from acute to specialized care.

But Irene Kimball, an official of the labor federation's Pioneer Valley council, strongly argued that the SPHS should be kept alive as a viable alternative to the much-larger competitor.

"Baystate Health and its HMO have forced the merger of smaller health providers into their system and in some cases, out of business," she charged, in an apparent allusion to the absorption of Franklin Medical Center in Greenfield and Mary Lane Hospital in Ware into the Baystate System, and the closure of Ludlow Hospital.

Kimball advocated legislation that would separate ownership of HMOs from hospitals.

That development is already occurring without legislation in some state where hospital administrators have soured on the supposed business advantages of vertically integrated health networks, Paul Long told The Catholic Observer.

Ten years ago, hospitals formed their own HMOs to capture a larger share of the managed care health business. But players in the now-saturated HMO market now maintain market share by offering lower prices to employers, and paying lower amounts to their health care providers.

What is financially good for an HMO might be bad for the hospital that owns it, explained Long, the president of the Hunter Group, a consultant group hired to advise the SPHS on its survival.

Long's point was picked up by legislators who wondered if Mercy could afford to provide HNE members at the same rate as Baystate.

Vincent McCorkle, president of SPHS, said that his system was prepared to meet the Baystate rate.

Some also wondered exactly how much HNE business the SPHS could capture, and whether the revenue from the extra patients would significantly alleviate the SPHS's projected 1999 deficit of $3.9 million.Two committee members -Rep. Cele Hahn (R-Westfield) and Rep. Thomas George (R-Yarmouth) --acknowledged that Mercy Hospital has financial problems. But they opposed any "special interest" bill that would re-regulate the healthcare market.

But in a possible sign that their position is politically unpopular, both legislators voted "present" on the bill, a position at least symbolically weaker than voting "no."

Sen. Brian Lees (R-East Longmeadow), the minority leader of the upper house, told the Observer (ital) before the hearing that the S. 2188 and other legislation benefiting the SPHS have considerable support where it counts on Beacon Hill.

"Leaders don't sign on as sponsors without the support of the speaker and president," said Lees, noting that the legislation is primarily sponsored by Sen. Linda Melconian (D-Springfield) and Rep. William Nagle (D-Northampton).

The pair are the number two legislators in each branch of the legislature.

Lees, who also supports the legislation, said that they would not be pressing forward if they did not have the implicit support of the powerful House Speaker Thomas Finneran (D-Mattapan) and Senate President Thomas Birmingham (D-Chelsea).

That support could prove crucial as western Massachusetts lawmakers attempt to garner support for a measure that is less understood in eastern Massachusetts.

The SPHS legislation is just one small part of a large agenda of healthcare-related matters that are expected to be considered by the legislature before its expected adjournment July 31.

Flavin concedes that the HNE bill for Mercy is special interest legislation, and is only a stopgap measure until more sweeping healthcare reform can be enacted by the state or federal governments.

"If we didn't take this action today, Mercy Hospital might very well be lost in the mix before we have a chance to address the broader question," Falvin told the Observer (ital) after the vote.