The Problem 

We pay some of the highest costs in the nation, and yet our hospitals are struggling to stay afloat. How can this be?

The problem is that large hospital chains have been allowed to operate as non-profits in name only. While nurses and doctors work to heal our wounds, the huge hospital chains they work for engage in dangerous cutthroat competition. They ruthlessly price-gouge consumers and use the windfall profits to expand into new markets, driving their competition (smaller hospitals) out of business and exerting monopoly control over entire regions.

The Wisconsin Legislature enabled this predatory business model in the 1980s. Acting under the influence of hospital industry lobbyists, the Legislature exempted the hospital industry from public oversight, repealing protections to consumers. Lobbyists promised that once their industry was deregulated, hospitals would more efficiently provide high quality care at an affordable price to every community.

Instead, the hospital industry abused our trust. They built massive hospital chains focused on providing the most profitable types of medical services while neglecting services communities need most, like mental health care or primary preventive care. In their relentless drive to corner the market, hospital chains drove up healthcare costs, destabilized the medical care system, and failed to provide the services that keep people healthy.

The result of de-regulation has been the dramatic collapse in the Chippewa Valley of Sacred Heart and St. Joseph’s, which provided the bulk of necessary but “unprofitable” care, but lost out in the feeding frenzy to their larger competitors. Now the larger hospital chains refuse to fill the dangerous care gap left by their predatory competition. Another example is the three large Milwaukee hospital chains who downsized and closed urban hospitals in majority Black and Brown neighborhoods, where the health needs are the greatest, and built massive state-of-the-art suburban facilities in wealthy predominantly white suburbs where they can extract higher profits. Rural Wisconsin also continues to lose critical health care services as hospital chains search out more profitable markets.

Enough is enough. The hospital monopolies are non profits in name only and are acting like banks, fossil fuel utilities, and other for-profit highly regulated industries.  It is long overdue for the hospital industry to lose its special protections and be regulated in the public interest.

The Solution 

Our state legislature has the power to put the guardrails back in place to lower costs for consumers and stabilize our teetering healthcare system. Until they act, our bills and insurance premiums will keep going up–and every community in the state risks suddenly losing critical healthcare access.

Reestablishing public control of the hospital system is a stepping stone towards our North Star of Medicare for All, where democracy makes the key decisions about the human right to health care. We are calling for:

1. The restoration of Wisconsin’s Hospitality Affordability Board, recklessly repealed in the 1980s. This will return public oversight to the prices the big hospitals charge. The Board will require that hospitals provide fair prices based on the actual cost of service.
2. The Fair Hospital Competition Act will ensure hospitals demonstrate the community need for any costly new medical service and capacity. This will prevent wasteful over-building, which drives up consumer costs, and require hospitals to share the use of costly facilities. For example, if there is enough MRI capacity already in a region, a hospital will not be allowed to build a brand new unit just so they can drain off business from their competitors. Sharing of resources and avoiding duplication of services will lower costs for patients and even the playing field for small, community-minded hospitals.
3.  The Fair Share Hospital Act, introduced by Sen. Chris Larson, will require hospitals to invest in community health at a level equivalent to their tax breaks–instead of using their profits to expand their empires. The hospitals that are most likely to close are often those that provide the most community benefits (for instance, treating the most patients with Medicaid or Medicare, as was the case with Sacred Heart in Eau Claire). By ensuring that each hospital does their “fair share,” this legislation will even out the playing field for hospitals who are most committed to providing care, even when it is not profitable.
4. The Legislature should act immediately to accept federal funds to expand BadgerCare so it covers more people. Research shows that expanding Medicaid reduced rates of rural hospital closure by 50%, because it provides a revenue stream desperately needed by small hospitals that provide the bulk of community care. The Legislature should also take up proposals, supported by nearly every Democrat, to “super-size” BadgerCare so that every Wisconsinite can “buy in” to BadgerCare and have a public option for quality, affordable health coverage.

Citizen Action calls on Wisconsinites to reach out to their legislators and ask them to curb escalating healthcare costs and stabilize our access to care.

Add your name to our petition to protect our right to healthcare.