A legislative committee in Delaware has reinstated funding for the Diamond State Hospital Cost Review Board, reversing an earlier decision to pause financial support. The board, established last year, is responsible for overseeing hospital budgets and ensuring they align with the state’s healthcare spending benchmark.

The board’s existence has been met with controversy, including a legal challenge from ChristianaCare, which questions its constitutionality in the Court of chancery. ChristianaCare argues that allowing a politically appointed body to overrule a hospital’s board requires a higher legislative vote threshold than was received.

The Joint Finance Committee (JFC) had previously voted to halt funding but reversed course on Tuesday. According to JFC Chair Kim Williams (D-Stanton), the committee received legal guidance that raised concerns about the constitutionality of reducing compensation for public officers.

“Our desire was and continues to be to act in the Delaware taxpayer’s best interest as we make these difficult decisions. In light of the legal guidance, we are now taking the necessary step of removing the pause altogether,” Rep. Williams said.

The vote to restore funding was nearly unanimous, with State Sen. Dave Lawson (R-Marydel) dissenting.

“I’m still concerned with the idea that the courts have it, and we’re gonna go ahead and move forward without a court decision, and I think that’s not in the taxpayer’s best interest, and I will be voting no,” Sen. Lawson said.

Brian Frazee, President and CEO of the Delaware Healthcare Association (DHA), a non-voting member of the Hospital Cost Review Board, issued a statement following the decision:

“While we are disappointed in Tuesday’s vote, we remain laser focused on ensuring Delaware has a better solution that addresses transparency, collaboration, and accountability around healthcare costs. Now is the time to come together and work on a real solution to meaningfully address healthcare affordability and improve health outcomes for all Delawareans. DHA and our hospital members have fully supported enhanced transparency that will assist with this critically important effort all along,” it reads.

In late May, the DHA and other stakeholders sent a letter to the JFC requesting a one-year delay in the board’s implementation, citing potential federal funding cuts and uncertainty about individual hospital accountability to the healthcare spending benchmark.

The board’s next meeting is scheduled for July 8. Rep. Williams indicated that the finalized state budget would be filed later in the week and then proceed to the House floor for its initial vote.

“Our desire was and continues to be to act in the Delaware taxpayer’s best interest as we make these difficult decisions.”

Understanding Hospital Cost Review Boards