Board adopts lower growth targets for selected high‑cost hospitals, adds annual reassessment and data correction path

The Health Care Affordability Board voted to adopt lower spending‑growth targets for hospitals identified as “high cost” under a staff methodology, and added an annual reassessment requirement and a mechanism to remove hospitals that show two consecutive years of improving relative prices.

The board framed the action as a step to reduce price disparities among hospitals and to protect household budgets. Secretary Kim Johnson moved the amended motion (motion 2 as presented by staff and amended during debate) and the board recorded five ayes; the motion passed.

What the board adopted

• Sector baseline: hospitals remain a distinct sector for target calculation; the hospital sector target equals the statewide spending target for most hospitals. The board retained the statewide spending target as the starting point for hospital performance.

• Identification of high‑cost hospitals: staff will designate hospitals as high cost using a two‑measure, five‑year lookback (2018–2022): commercial inpatient net patient revenue per case‑mix adjusted discharge (NPR/CMAD) and the commercial‑to‑Medicare payment‑to‑cost ratio (PTCR). A hospital is identified as an outlier if it is above the 85th percentile on those measures for at least 3 of the 5 years and meets a minimal commercial payer mix threshold and data comparability requirements in the annual financial disclosures. The board approved an amended motion that adds a discharge threshold (30th percentile)…