DELAWARE - Senate Bill 213 has been signed into law after a lawsuit that claimed one of the components for the act violates the Delaware Constitution.
In 2024, HB 350 was enacted to control hospital cost growth. It allowed a state board to watch hospital spending with four main components:
- Hospitals must submit detailed budgets every year
- The Board checks whether hospitals meet a state spending benchmark
- If a hospital misses the benchmark → it must submit a fix-it plan
- If the hospital still fails → the Board can approve or change the hospital’s future budget
Shortly after, ChristianaCare filed suit, saying the fourth component violates the Delaware Constitution. However, on Sept. 30, 2025, the State and ChristianaCare signed an agreement pausing the lawsuit and setting forth the framework for Senate Bill 213 that, if enacted, will fully resolve the case.
Under the agreement, the State admitted no fault. The Act addressed constitutional concerns by eliminating the Board’s ability to approve or modify hospital budgets, while preserving the first 3 components of HB 350 with certain modifications.
The agreement states that hospitals should still submit detailed financial information every year but the board reviews the previous year's spending and not future budgets. Hospitals should also explain what changed from the last year and what they will do next to control costs.Â
The board should also start formally documenting its decisions by stating whether a hospital met the spending benchmark, followed its compliance plan and if it is part of a MCCA.Â
As with the fourth component, now if the BCP does not meet the criteria established by the Board, the Board may require the hospital to amend and resubmit the BCP. If a BCP is required, the Board will examine and determine in writing the following year whether the hospital has satisfied the BCP’s elements.Â
"The signing of Senate Bill 213 marks the end of a two-year debate on the House Bill 350 law and welcomes a new era of collaboration to improve healthcare affordability. We have always shared the same goals – high-quality, accessible, and affordable healthcare for all Delawareans – and now we can move forward together," said Brian Frazee, President & CEO of the Delaware Healthcare Association.