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MN Democrats say how to control health care costs, but medical providers have resisted

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Efforts by Minnesota Democrats to impose new rules on the health care sector have met aggressive lobbying from some of the largest medical groups in the state.

Democratic-Farmer-Labour Party members want greater oversight of nursing staffing levels, drug prices, overall medical costs and healthcare system mergers. Their effort to expand access to MinnesotaCare, the state’s insurance program for the working poor, is also facing industry backlash.

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All of these ideas hang in the balance as lawmakers scramble to complete the next state budget by Monday, when the legislature must adjourn.

Hospital and health care leaders say their sector is facing its worst financial challenges in decades. They say half of Minnesota’s hospitals are losing money and all health care systems face workforce shortages.

Healthcare professionals and patient advocates counter that the changes are long overdue and will make healthcare more accessible and patient-centred. They also argue that the policies will help stop the surge of healthcare workers leaving the sector due to burnout and safety concerns.

Nursing staff

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After nearly a year of contentious negotiations with hospitals and health care systems in 2022, the Minnesota Nurses Association turned its attention in January to pushing the Keeping Nurses at the Bedside Act through the legislature.

The bill would require hospitals to create committees of healthcare providers and managers to set staffing levels. The committee would ensure that these standards were met, and if not, staff could request the intervention of an arbitrator.

Nurses say staffing standards are needed because hospitals are too often understaffed and healthcare workers struggle to properly care for patients.

Hospital leaders say these committees would give nurses too much control over hospital operations and that superiors would lack the flexibility to meet changing patient needs.

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The Mayo Clinic strongly opposes the bill and has threatened to take billions in new investment from the state if it is passed. Democratic leaders are considering a cut for Mayo and other hospital executives say they should also get around some of the more onerous regulations.

Medical expenses

Mayo leaders also spoke out against a new council on healthcare affordability that would set cost growth targets. Suppliers who exceed those targets would be required to implement cost-cutting plans and could face fines of up to $500,000 if they fail to address rapidly rising costs.

Minnesota would be the 10th state to implement such a council, if the measure is included in one of the budget bills lawmakers are finalizing.

Democrats and panelists say it will help curb rising medical costs, which have long since outpaced inflation.

Republicans questioned how forcing health care workers to pay hefty fines would help reduce health care costs. Hospital executives have pushed to remove the penalties altogether.

Prices of drugs

The Commerce budget that cleared the House and Senate on Wednesday includes a prescription drug affordability advice that would limit how much Minnesotans pay for certain drugs and prohibit price gouging.

It would also limit copays for some medicines that treat chronic diseases such as diabetes.

This is a big win for Minnesota families who are forced to pay large sums of money for life-needed medicines and supplies like insulin, asthma inhalers and epi-pens, said Rep. Michael Howard, DFL-Richfield , which was the main sponsor in the house.

Pharmaceutical Research and Manufacturers of America, or PhRMA, has lobbied hard against the bill, saying it will stifle innovation and arguing that lawmakers are targeting the wrong part of industry if they want to control drug costs. They said insurers and pharmacy benefit managers keep billions in rebates and discounts on drugs they are supposed to pass on to patients.

The bill threatens the doctor-patient relationship and prompts bureaucrats to consider whether certain treatments are worth paying for, PhRMA said in a statement. It also does nothing to stop health insurance plans and their PBMs from charging patients for more drugs than they do.

Healthcare mergers

The announcement last year that Fairview Health Services wants to merge with Sioux Falls, SD-based Sanford Health has raised concerns with patient advocates and state regulators.

After a series of public meetings and an ongoing investigation by Attorney General Keith Ellison, lawmakers have moved forward a bill that would give the state more power over healthcare mergers.

Under the legislation, the attorney general could derail the deal if it is found to be not in the public interest because it could jeopardize access to care or result in job losses or pay cuts.

The bill would also require that all charitable assets received by the organization be returned to the state. In Fairviews’ case, it could also impact the relocation of two teaching hospitals it manages under an agreement with the University of Minnesota.

Expanding access to insurance

Democrats are also moving forward with plans to expand access to MinnesotaCare, currently the state’s insurance program for the working poor. MinnesotaCare operates on a similar framework to federal medical assistance plans, and a bill from the legislature would remove income caps currently in place that restrict who can purchase coverage.

Democrats argue that expanding access to MinnesotaCare would give more people access to insurance. They say some are still shut out of the market because their incomes are too high, but insurance premiums remain unaffordable.

Hospital executives fear the expansion of government-run health care will hurt their bottom line because state reimbursement rates for care are so low. That in turn could lead to higher costs for people with private insurance plans, opponents say.

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