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'Vicious Cycle' Flagged in MA Hospital Financing Disparities

John Commins, for HealthLeaders Media, March 21, 2014

Lobbying efforts by community hospital chain Steward and a labor union take on the Boston-based teaching hospitals.

A new report out this week details a "vicious cycle" of inequality in healthcare financing in Massachusetts that has created a "rich get richer" caste of prosperous Boston-based teaching hospitals that drive up costs at the expense of community hospitals and low- and middle-income families.

The report, Healthcare inequality in Massachusetts: Breaking the Vicious Cycle, was commissioned by Steward Health Care System LLC, which operates 11 community hospitals in Massachusetts, and 1199 SEIU United Healthcare Workers East. The labor-management pair founded a lobbying organization, Healthcare Equality and Affordability League (HEAL), to press their argument.

"There tends to be a fairly high usage of teaching hospitals for more routine services in Massachusetts than in other states. That is partly one of the reasons why the costs are fairly high in Massachusetts," says lead author David E. Williams, a consultant with Health Business Group.

"We have some world-famous and renowned hospitals and physicians in Massachusetts and they are rightly seen as key economic drivers for the whole state economy. Patients like to go to these providers, and traditionally the health plans have supported that. It's just a matter of those larger famous institutions using their brand to be able to do the kind of business they want and people wanting to go there."

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