AUGUSTA – Maine hospital costs increased faster than the national average in 2002 and Maine hospitals made more money per patient discharge from 1997 to 2001 than other New England hospitals, according to a report released Wednesday by Consumers for Affordable Health Care.

The report, which was quickly criticized as inaccurate by hospital officials, said costs grew 10.2 percent during 2002 compared to the national rate of 3.3 percent. The growth outpaced personal income, which contributed to unbearable health care costs, said Joseph Ditre, spokesman for the group.

Despite the growth, and comparatively strong profits, national data showed quality of care was no better in Maine, according to the group’s report, titled “Off the Charts.”

“These hospitals costs have to be looked into,” Ditre said. “Why are Maine hospitals so out of the norm with other hospitals in the country?”

Steven Michaud of the Maine Hospital Association disputed the report, saying it used flawed numbers. In particular, the 3.3 national growth figure is actually closer to 8.5, he said.

The report was released at a press conference at which six small-business owners spoke about how escalating hospital costs are breaking companies and “driving sick people into debt.”

Gary Keilty of Tyson & Keilty Realty in Readfield said he and his wife spend $900 a month on health insurance.

In the mid-’90s, Keilty said, he served on the Consumer Advisory Council to the Maine Health Care Finance Commission. The MHCFC was a state commission, now disbanded, that regulated hospitals.

Keilty said lobbyists and attorneys for Maine hospitals did not like being regulated and argued, “If you leave us alone, we have the expertise to keep the costs of Maine hospitals down,” Keilty recalled. “They said: ‘We know best.'”

But hospitals broke that promise, and businesses and citizens “can no longer bury our heads in the sand and pretend the cost of running Maine hospitals is not our concern,” Keilty said.

The MHA’s Michaud said that while hospitals pushed to abolish MHCFC, they broke no promises. He said they have been merely riding an inflationary wave. “We’re not doing anything different than what the rates of inflation are.”

The report also said Maine hospital profits – or money left over after paying the bills to provide care – were higher than most other New England states from 1997 through 2001. The report cited data from the Almanac of Hospital Financial and Operating Indicators.

“Per discharge, we’re more expensive than any of the peer hospitals looked at in this report,” Ditre said.

Michaud responded saying any claim that Maine hospitals are profitable is “false.” He said Maine hospitals did make more money per patient than other states from 1997 to 2001, “but things have changed dramatically.

“It’s old data,” Michaud said. “Now hospitals are right at break-even. We’ve got half at or below break even.”

Michaud also said cost comparisons in the report are flawed in that the national 3.3 percent increase does not include growth of patient volume while the Maine numbers do.

“It’s like they compared the price of a cup of coffee but not how many cups we sold,” Michaud said. When including the growth of patient volume, Maine hospital costs were higher than the national average, but not as much: 10.2 versus 8.5 percent, Michaud said.

Ditre said he group used the best available data. Saying that no one – not even the federal government – knows actual hospital finances, Ditre acknowledged the study used some estimates.

But he said his group relied on numbers that came from the MHA last year, when it used the 10.2 percent figure in assessing how Gov. John Baldacci’s Dirigo health plan would harm hospitals.

Ditre said his group also used the federal National Input Price Index, which he said concluded that for 2002 the national average for hospital cost growth was 3.3 percent. Ditre acknowledged that patient volumes might not be factored into the federal figure.

Ditre said the national data also indicated that in 2000 and 2001, Maine hospital costs grew at more than twice the national average, or 9 percent in Maine compared to 3.8 and 3.9 percent nationally.


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