While medical costs, at nearly 90% of the health care dollar, drive most of the annual increase in health care premiums, there are very real opportunities to lower administrative costs through collaborations. The New England Healthcare EDI Network (NEHEN) and Healthcare Administrative Solutions Inc.a (HCAS) are two successful examples of such collaborative efforts.

NEHEN is a payer and provider owned electronic connectivity solution that processes 60 million transactions per year (80% of the state’s transactions) with a savings to members of $20 million annually in transaction fees alone. A subscription service with a low cost of ownership, NEHEN removes barriers to automation for members while simplifying and improving the accuracy of operational transactions. Benefits for health providers include reduced claim denials, reduction in bad debt and write-offs, and lower administrative costs. Benefits for health plans and members include increased accuracy and timeliness as well as lower processing costs. Currently over 50 hospitals, 5,000 physicians, and 8 health plans are NEHEN members.

HCAS, founded in January of 2005, is a nonprofit collaborative of major regional health plans dedicated to simplifying administrative processes. Its first initiative, a redesign of the provider credentialing process, has recently been completed. The new process enables providers renewing their health plan credentials or submitting credentials for the first time to use a single, standardized process established by HCAS. Previously, health plans administered different processes, requiring providers to submit similar information over and over again. Duplicative processes have been eliminated and replaced by a single process that delivers administrative cost savings, improved cycle times, and greater accuracy.

NEHEN and HCAS are just two examples of the kind of efficiencies that collaborations can produce. Such cooperative efforts hold great promise for lowering administrative costs. Who knows – perhaps the model can be employed to help reduce medical costs as well!

Bruce Bullen
Chief Operating Officer
Harvard Pilgrim Health Care

The passage and ongoing implementation of the Massachusetts Health Reform law has sparked interest among governors and legislators across the country in finding ways to expand access to affordable, high quality health care. It seems, in fact, that there is a growing political consensus that reforming the health care system should be a major national priority. Despite the growing recognition of the pressing need for health care reform, consensus on how to go about reforming the health care system has been elusive at the federal level. If history is any guide, this will become even more challenging in the coming election year.

As we approach the presidential elections in 2008, every presidential candidate is being pressed to present their detailed plans for health care reform. Not surprisingly, many of these plans view “fixing the system” from a national vantage point. However, our health care system is an amalgamation of different component delivery mechanisms with varying levels of quality and efficiency in delivery and practice. While some major aspects of heath care are truly national in scope, the reality of our health care system is that health care delivery is truly local.

In this regard, it is not surprising that some states and local communities are leading the way to health care reform through innovation in coverage expansion and by enabling and promoting greater quality and cost savings in health care. California, Connecticut, Maine, Indiana, New Hampshire, New York, Vermont, Wisconsin and Massachusetts, are notable examples of states that are already exercising leadership in this area. However, there is the potential that state leadership and innovation in health care could easily get lost in the clamor for “national solutions”, particularly in an election year. Read more…

It’s September and that means it’s back to school for millions of children, and back to session for our Congress. There isn’t a healthcare advocate that I know who doesn’t realize that this session of Congress holds the healthcare and future welfare of almost 9 million children in their hands. It is a deeply disturbing fact that in this country, with all it’s wealth and innovation, we have children without access to consistent and comprehensive healthcare.

Many states have extended coverage to school-aged children through the States Children’s Health Insurance Program (S-CHIP). Yet there still are too many working families living in poverty or near poverty who can not afford health coverage.

Masschusetts is a state that has made covering kids a priority. But without a full appropriation of $50 billion, roughly 14,000 children in the Bay State will lose that coverage. Some of them were just covered by our health reform expansion, and now they are again in health insurance jeopardy. These are children living in families who earn between 250 – 300% FPL.

Without this funding for S-CHIP, chances are their parents will be in health insurance jeopardy as well. Read more…

Massachusetts is one of the healthiest states in the country, but—like the rest of the nation—we face unacceptable racial and ethnic disparities in health and health care.

The Department of Public Health (DPH) recently released health status indicators and data that confirm alarming disparities across the state. They exist in access to care; incidence of chronic diseases, such as asthma, diabetes, and high blood pressure; and in hospitalizations and mortality for conditions like cancer and HIV/AIDS. Throughout the United States and in all regions of Massachusetts, racial and ethnic minorities—particularly African-Americans and Latinos—have worse health outcomes than other groups.

The numbers say it all. The infant mortality rate among African-Americans is more than double that of whites, and heart disease death rates are more than 40% higher. Hispanics are almost twice as likely to die from diabetes as non-Hispanic whites. Cervical cancer risk is particularly high among Latinas, with incidence rates that are double those of white women, who are also less likely to die from the disease. And Korean-American men, for example, experience a rate of stomach cancer that is five times the rate of white men.

Although critically important, access to insurance is not the most significant contributor to these differences, so while health care reform will benefit those who were not previously insured, we must take other action steps to address disparities. Read more…

“When we were at Mount Sinai, the Lord our God said to us, ‘You have stayed at this mountain long enough. It is time to break camp and move on. Go to the hill country of the Amorites and to all the neighboring regions—the Jordan Valley, the hill country, the western foothills, the Negev, and the coastal plain. Go to the land of the Canaanites and to Lebanon, and all the way to the great Euphrates River. Look, I am giving all this land to you! Deuteronomy 1:6-8a (New Living Translation)

Sunday afternoon September 9, 2007, sixty-five Greater Boston Interfaith Organization clergy and lay leaders gathered at the Roxbury Presbyterian Church USA to kick-off GBIO’s Fall Healthcare Outreach and Enrollment Campaign. In a sense, our gathering was in response to the call, a Divine Call for us to “break camp” and “move on”. We have returned from our various summer resting places, full of Spirit, energy, and excitement – ready to join with others across the state in reaching out to the uninsured and encouraging them to enroll in Commonwealth Care or Commonwealth Choice before the deadline of our new individual mandate – January 1, 2008.

During this high-energy training and breaking camp session, GBIO leaders were treated with some excellent teaching about how to help people evaluate their options. There was a testimony from someone recently enrolled in Commonwealth Care as to the importance of our work. And there were resource packets distributed so that everyone has the written information they need to complete their job. But perhaps, most important, was the unbroken flow of inspiration and encouragement that called us to break camp, move on, advance knowing that this outreach work is important and blessed in the eyes of God. Read more…

When people debate the merits of health care delivery systems, it isn’t the quality that is in question, though it should be part of the discussion. Rather, in large part, it is the cost of insurance coverage that fuels the debate. As the CEO of a not-for-profit health care plan, I can tell you firsthand as one who oversees the coverage of more than 650,000 members, and as an employer, whose company’s health care costs were in the neighborhood of $15 million last year, keeping health care as affordable as possible is something I think about a great deal. So I thought it would be constructive to share with you the break down of how premium dollars are spent.

Overwhelmingly, health insurance premiums pay for the cost of medical care and other services that benefit members. That’s appropriate and why one has insurance in the first place.

According to information compiled by the Massachusetts Association of Health Plans, in our state, medical expenses account for 87 percent of the health care dollar. That includes hospital services, physician care, other health professionals, medical devices and other medical services, and prescription drugs.

Ten percent goes towards administrative cost, which includes care management programs for individuals with chronic conditions, functions such as claims processing, consumer and provider support, marketing, compliance with government laws and regulations, and other activities that support health plan operations.

Among not-for-profit plans, administrative costs also include reinvestment of funds into strategic initiatives designed to control costs and improve members’ health. Read more…

Health care reform in Massachusetts is complicated, placing new responsibilities upon employers, individuals and state government. As an organization representing employers, A.I.M. has been working closely with the state agencies responsible for developing the rules governing new employer requirements. Our recent experience with two state agencies – the Division of Unemployment Assistance (DUA) and the Department of Health Care Finance and Policy (DHCFP) – around the new reporting requirements for the so-called “Fair Share Contribution” has been very positive.

As observers of health care reform know, the law requires all employers in Massachusetts with 11 or more employees to make a “fair and reasonable” contribution to their employees’ health insurance premiums or pay a “fair share assessment” of $295 per employee per year to the state. A subsequent regulation outlined the test that would determine if an employer made a fair and reasonable contribution, consisting of two parts: (1) are 25% of the full-time employees enrolled in the employer’s health insurance plan, or (2) does the employer contribute at least 33% of the premium.

In July DUA, which is the agency responsible for collecting the fair share assessment, formed a pilot group of 25 employers to “test drive” the proposed methodologies for each of the tests. It became evident almost immediately that the methodology for collecting and reporting information for the first test was extremely complex and administratively burdensome. As a result, both DUA and DHCFP are working with A.I.M. to develop a more streamlined procedure without changing the original intent of the two-part test. A.I.M. applauds both agencies for their responsiveness to the concerns of the employer community, and for their thoughtful approach to addressing the issues we identified.

I write about this recent experience because in a small way it exemplifies the extraordinary collaboration that has occurred over the past three years in Massachusetts in our efforts to provide insurance coverage to all of our citizens. The willingness of all parties – businesses, insurers, health care providers, advocates and government officials – to work together to overcome obstacles and differences of opinion before they become serious impediments to progress is the distinguishing feature that has made Massachusetts the national leader in health care reform. All involved can take pride in our common effort in pursuit of our common goal.

Richard Lord is President and CEO of Associated Industries of Massachusetts.

There’s growing and undeniable momentum to address deficiencies in healthcare quality in the US and in Massachusetts. Just in the past month, Medicare announced that beginning 10/08, it will no longer pay hospitals for care related to hospital infections and so-called “never events;” the MA Department of Public Health issued a new report on hospital infections and unveiled their new initiative to publicly report infection rates to the public; and the MA Quality and Cost Council is advancing an ambitious quality agenda.

We know the overwhelming majority of doctors, nurses, hospitals and other providers are committed to quality care and want to provide only the highest quality care. We know most errors are related to system problems, not individual behavior. And we know that health care too often needlessly harms patients and falls far short of the Institute of Medicine’s standards that care be: patient centered, timely, safe, efficient, effective, and equitable.

A voice often missing from conversations about quality is the consumer’s. At Health Care for All, we have created a Consumer Health Quality Council to give a voice to consumers about quality. Council members have been harmed and have seen family members suffer because of infections, misdiagnoses, miscommunication, and other medical errors. They are motivated by their personal experiences not to sue, but to advocate for better public policies to ensure quality care for all MA residents.

The Council is working hard to support a bill to be heard by the Legislature’s Committee on Public Health next week (9/12, 10am, State House Hearing Room A-1). Read more…

How many people are uninsured in Massachusetts? Each year around Labor Day we get dueling answers; one from the U.S. Census Bureau and another from the Massachusetts Division of Health Care Financing and Policy. Getting the right answer is crucial to the future of health reform in The Commonwealth.

Covering 651,000 (the U.S. Census Bureau’s estimate of the uninsured in 2006) is a lot harder and more expensive than covering 355,000 (our state government’s estimate for spring, 2007; their 2006 estimate was 395,000).

So whose number is correct? The Census Bureau sends surveyors door-to-door, with interviewers available for almost every language (including Portuguese and Haitian Creole, common languages in Massachusetts). The state survey calls people on the phone (land lines only, no cell phones) and has interviewers who speak Spanish and English – but no other languages. Anyone without a land-line telephone or who spoke another language was, in effect, counted as insured.

But we know from Census surveys that 43.9% of phoneless adults are uninsured. Moreover, immigrants are often stuck in low-paying jobs that don’t bring benefits, and hence have extraordinarily high uninsurance rates. Yet only 41% of the Commonwealth’s non-English speakers are Spanish speakers; the other 59% (about 530,000 people) vanish in the state survey. In sum, the state’s figures are unreliable – a fact confirmed by a third survey, carried out by the Urban Institute for the Blue Cross Foundation. This survey – also done on the telephone, but with statistical adjustments to avoid undercounting – confirmed the Census Bureau’s findings.

Why does it matter whether the state’s estimate or the Census Bureau’s is right? According to the state, we’re almost half way to covering the uninsured. Read more…

I’m writing this blog the day of the third game in the Red Sox-Yankee three game series, and while hope springs eternal, we already know the bad news about games one and two. All of which makes me feel a little skeptical about other recent news coming from New York. It appears possible that even health care reform isn’t faring as well in the Empire State as it is in Massachusetts. New York’s Attorney General has taken on the issue of physician tiering and seems to be suggesting that the goal of transparency should not extend to ranking doctors, despite the evidence that there is significant variance among doctors treating the same conditions in terms of both quality and cost has been known for years. We can hope that as the NY AG digs deeper into the facts he can be convinced that consumers are better served by more, not less information. We at the GIC don’t have a horse in this particular race – we don’t contract with any of the three health plans under scrutiny in New York. A spokesman for A.G. Cuomo’s office has said that they are not opposed to physician profiling in principle, but…and it’s the “but” that makes me nervous. We hope that their efforts will result in recommendations that will make the three companies’ products better and more useful to consumers and providers. One way or another, it’s time to look more critically at what we are getting for our health care dollars and identifying which providers serve us better with both skill and efficiency. In the last analysis, giving patients information is the best consumer protection – and the best road to lasting health care reform.

Dolores L. Mitchell, Executive Director of the Group Insurance Commission of the Commonwealth of Massachusetts, the agency that provides life, health, disability and dental and vision services to over 285,000 State employees, retirees and their dependents.