Boston Children’s Hospital Expansion Comes Under Fire

The Health Policy Commission says the plan could raise healthcare spending and threaten other pediatric hospitals.
Boston Children's Hospital

Photo by Dana Guth

UPDATED, September 30, 4 p.m.: WBUR’s Commonhealth is reporting that the Massachusetts Department of Public Health (DPH), unlike the Health Policy Commission, is in favor of the Boston Children’s expansion. In a statement released Friday, DPH officials say that the project “meets the regulatory requirements and includes many positive aspects to improve care for the children and families the hospital serves.” In addition, the report says an independent cost analysis found the expansion unlikely to significantly affect state healthcare expenditures. The proposal will go before a Public Health Council vote on October 20.

Original story:

A proposed $1 billion expansion of Boston Children’s Hospital is under fire, with experts saying the plan could inflate state healthcare spending and drive competitors out of business.

In a report released Tuesday, Health Policy Commission (HPC) Chair Stuart Altman writes that the expansion could raise Massachusetts healthcare spending by between $8.5 million and $18 million, and slash patient volumes at some other local pediatric hospitals by between 24 and 44 percent.

“Because Children’s has among the highest commercial and Medicaid MCO prices in the state for hospital care, shifts of patients from any other Massachusetts hospital to Children’s would be cost-increasing,” Altman writes. “The proposed expansion could also increase Children’s already substantial market share (46 percent of statewide commercial pediatric discharges in 2015).”

The proposed plan would add 71 beds, an 11-story tower, a new ambulatory care center, four operating rooms, and two MRI machines to the hospital’s facilities. It would also expand existing programs. Altman argues that those updates, combined with a robust referral program, would likely attract patients away from other pediatric hospitals in the area, simultaneously driving up costs and upsetting the local medical ecosystem.

Boston Children’s, on the other hand, has argued that most new patients would come from other states and countries—a patient subset that is, indeed, increasing. Altman writes, however, that most patients still come from Massachusetts, and that out-of-state numbers are not increasingly quickly enough to fill all the beds that the expansion would add.

Boston Children’s dismissed the HPC report in a statement, saying it “respectfully, but vehemently, disagrees” with its findings. The statement also maintains that the hospital is dedicated to keeping costs under control, and to leaving less complex cases to other community health providers.

“The data used by HPC is flawed, misleading and speculative. Even if HPC’s worst case scenarios plays out, the cost impact would equal a 0.033% increase in costs to Massachusetts consumers per HPC math,” the Boston Children’s statement reads. “Currently, Boston Children’s is seeing that early trends are consistent with our projections.”


Jamie Ducharme Jamie Ducharme, Contributor jducharme@bostonmagazine.com