News on the state's largest health insurers; the effects of health care reform on coverage; rising premium costs.
As we speak, a debate on S.2260, the Senate’s health care cost bill, is underway. You can watch it live here.
But get comfortable: staffers report there are 265 filed amendments to consider.
Lawmakers weigh in on the Senate health care cost bill
Update at 4:53: The Senate voted 15-22 rejecting amendment #125 that sought to trigger a single-payer health care system.
Gov. Deval Patrick. (Photo: Massachusetts Energy and Environmental Affairs/flickr)
For the first time since lawmakers in the Massachusetts House and Senate unveiled separate plans to cut health care costs, Gov. Deval Patrick is weighing in.
At a Greater Boston Chamber of Commerce breakfast this morning, Patrick told business leaders that the state should set aggressive spending targets, let government play a role in keeping insurance premiums down, and not necessarily create an entirely new agency to oversee the new reforms. In making his case for government oversight as a way to counter a not-always-reliable marketplace, Patrick put himself at odds with several elements of both the House and Senate plans.
“Industry can do better than the GSP [Gross State Product],” he said, according to a copy of his prepared remarks given to WBUR. “I certainly could not imagine accepting GSP plus anything…”
Here is Patrick’s entire speech, as prepared for delivery, from his office:
Thank you very much, Paul, and good morning, ladies and gentlemen.
As I think about the last couple of times we have been together at a Chamber breakfast, I realize I often come here to talk about health care. It makes some sense to do so in this company. Health care reform is one of the most important public-private initiatives in recent Massachusetts history. Many of you helped create and now help sustain it, and all of you deal with the challenge of rising insurance premiums. So you will understand if I return to the subject again this morning, especially given the developments of the past two weeks – and the past two years, for that matter.
We have a lot to be proud of when it comes to health care reform. We started with the belief that health is a public good and that everyone deserves access to affordable, quality care. That, for us, is a basic value, an expression of the kind of Commonwealth we want to live in, meaningful enough to motivate a broad coalition of legislators, policy makers, business and labor leaders and patient advocates in 2006 to reform the way we access health care.
And that reform is working. Here are the facts:
Almost everyone has access. 98.2 percent of our total population is insured. 99.8 percent of children. While the national trend between 2006 to 2010 was going in the other direction, we increased the number of insured in Massachusetts by more than 400,000 people.
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By Rachel Zimmerman and Carey Goldberg
The Massachusetts Senate today released its version of a sweeping plan to control health care costs. And guess what? It’s pretty close to the sweeping plan the House released last week. Both emphasize preventive care and wellness. Both place a specific cap on the growth of health spending linked to the growth of the state economy. And both envision shifting more care into systems that put doctors on a budget instead of paying per procedure.
In the details, the Senate plan may be slightly more business-friendly: There’s no “luxury tax” on pricey hospitals that fail to justify their high costs, and there are more references to “market-based” solutions as opposed to government interventions.
The Senate’s cap on health spending is also slightly less restrictive. (Until 2015 it’s set to be equal to the projected growth of the gross state product plus 0.5%. From 2016 to 2026 it’s equal to the projected growth in the state’s GSP and from 2027 and beyond, it’s the GSP plus 1.0%. The house plan proposes GSP minus 0.5% beginning in three years.)
Other new elements: The Senate bill‘s prevention and wellness provision is backed by $100 million in funding over five years. And it establishes a new certification process for “Beacon ACOs,” the most effective accountable care organizations. These “beacons” would get preference in state health-care contracting.
The Boston Globe’s Liz Kowalczyk sums up the House-Senate difference in flavor: “The Senate bill appears to allow doctors and hospitals more leeway to find their own solutions, while the House appears to want more oversight.”
Still, the degree of common ground is notable. Electronic health records become inescapable in a few years. The price of specific medical tests and treatments should soon be transparent to any consumer who checks a Website or makes a phone call. If your doctor makes an error, you may well receive a direct and prompt apology under new medical malpractice provisions in both bills. State agencies overseeing health care are reorganized.
We asked a few local experts for their first impressions.
Jonathan Gruber, the MIT economist who served as an advisor on the state’s 2006 health insurance reform law as well as the national Affordable Care Act, emailed that the two bills “look pretty darn similar to me.” Continue reading
(quaziefoto/flickr)
A new study by the RAND Corporation bears this out. It concludes that when consumers have the kind of health insurance that requires more out-of pocket payments, they do, indeed, become more mindful of their care. And this more conscious approach to picking and choosing medicines, tests, specialists and treatment could save billions annually, the report, published in the May edition of the journal Health Affairs notes. But these so-called “consumer-directed” health plans, notably high-deductible plans and personal health accounts, do have risks because people may forego important prevention and treatment measures in order to cut costs.
“The study found that among families enrolled in consumer-directed health plans, about two-thirds of the savings were the result of fewer encounters with health care providers. The remaining third was caused by lower spending per encounter, suggesting patients were making different choices about tests and treatments. Families in consumer-directed plans used fewer brand-name drugs, had fewer visits to specialists and had fewer elective hospital admissions than families in traditional plans,” the news release says. Continue reading
This just in from Michael Norton at State House News Service:
Stepping in front of a planned announcement from state senators, House leaders late Thursday said they’ll unveil a long-awaited health care payment reform and cost control bill on Friday.
According to House Speaker Robert DeLeo’s office, the bill will be unveiled during a 2:30 p.m. press conference in Nurses Hall with Health Care Financing Committee Co-chairman Rep. Steven Walsh (D-Lynn) and other members of the committee.
Senate President Therese Murray said last week the Senate planned to debate its version of Gov. Deval Patrick’s payment reform bill, filed in February 2011, in mid- May, after the bill emerged from the Senate Ways and Means Committee. This week, Murray said the Senate bill would be released next week.
Rumors began circulating on Beacon Hill Wednesday that a House health care bill might emerge on Friday, before the Senate bill. Until Thursday afternoon, House aides either declined to respond or declined comment when asked to confirm those plans or whether committee members were voting on bill. Continue reading
In this April 12, 2006, file photo, then-Gov. Mitt Romney is seen with lawmakers and staffers after signing the state's universal health law at Faneuil Hall in Boston. (AP File)
The House and Senate are expected to build on movements that are already under way: global payments, electronic health records and the increased focus on primary care. The House point person on health care, Steven Walsh, has outlined his proposals in meetings with dozens of groups.
Legislators are considering some controversial moves.
The Senate has talked about taxing insurance company profits. One House leader has a proposal to close the gap in payments to rich and poor hospitals. There’s a vigorous debate about how aggressive the state should be in trying to hold down health care costs. Continue reading
(jimmywayne/flickr)
“There’s a bit of Bay State pride tied up in this,” said Brian Rosman, research director for the Boston-based advocacy group Health Care for All. “We were the first to figure out universal coverage. Now we want to be the first to crack health-care costs.”
The Post report touches on various aspect of the wide-ranging cost-cutting plan, expected to be out later this month:
The payment-reform law that Massachusetts will soon debate could create new incentives for doctors, hospitals and providers to participate in a payment system that looks a lot like the Alternative Quality Contract.
In February 2011, Gov. Deval L. Patrick (D) introduced legislation that would have moved all Massachusetts health-care providers to value-based payments (arrangements like the Alternative Quality Contract) by June 2015. A new government entity, created by the bill, would facilitate that change, setting various benchmarks and timelines… Continue reading
(Fotopedia.com)
Very soon, the topic of health reform is going to get white-hot again in Massachusetts. Legislative leaders will reveal their plans for the next stage, the part left out of the landmark 2006 law: How to cut costs. Gov. Deval Patrick laid out his own blueprint last February, and now, at long last, this next political shoe will drop.
To prepare you and ourselves, we at WBUR are gathering a glossary of terms that it will help to know in the coming debate. We entreat you to improve on our definitions and write in suggestions for more. And most of all, we need a catchy title for what’s coming. Health reform, part two or 2.0? Health reform 2012? There’s Romneycare and Obamacare, but Devalcare or Patrickcare just don’t sound right, especially for the coming legislative initiatives.
One thing we do already know: We’re going to use the Twitter hashtag #mahealthcosts for relevant tweets, and invite you to do the same.
ACO — Accountable Care Organization – An accountable care organization is a collection of hospitals, doctors, and other care providers that coordinate among themselves to provide high-quality, efficient care to a patient within the bounds of a single payment. Consumers, at some point you will likely be asked to sign up for one of these. This is a really important decision because it means you’re making a commitment to get most or all of your care from within this group. Here’s a fuller explanation in cartoon form: “What The Heck Is An ACO?”
AQC — Alternative Quality Contract — The global payment model created by Blue Cross Blue Shield of Massachusetts. Other major insurers now offer their own global payment contracts.
Bundled and episode-based payments — “Providers are reimbursed for clinically defined episodes of care – that is, a lump sum payment is made to providers in different settings for caring for one patient who has undergone, say, a major procedure.”(From the Massachusetts Hospital Association’s new guide to health reform, “Completing the Journey.”) Continue reading
(401k/Flickr)
By Michael J. Widmer
Guest Contributor
A new Massachusetts Taxpayers Foundation (MTF) study finds that in fiscal 2011, the state’s share of spending attributable to the 2006 health reform law was $453 million, or 1.4% of the $32 billion budget. And, when you look at the first five years of state spending for health reform, the annual increase, year-to-year, averaged about $91 million. In short, health reform hasn’t been a “budget-buster” as some critics have claimed. Pretty good news, right? Well, the Pioneer Institute‘s Josh Archambault and Amy Lischko aren’t so sure. While they largely accept the way MTF calculated the cost of health reform, they’ve applied some creative accounting to challenge the report’s conclusions.
A little background might be helpful: With our focus on the state budget, tax policy, and the Massachusetts economy, MTF’s engagement in health reform goes back many years. Prior to enactment of the 2006 law, we concluded that the state would have to increase spending by about $100 million a year to achieve the goal of nearly universal health insurance coverage. In 2008, with implementation well underway, some critics of the law began predicting “massive cost overruns” – up to $2 billion over ten years – with “back-breaking costs to the taxpayers.” So, in 2009, and again this year, MTF decided to take a look at the numbers and report on what was really going on. Specifically, we wanted to know how the health reform law was affecting state spending over time. Where has spending gone up because of the law and why; where has it gone down; what has been the net change year-over-year; and is it manageable in the context of the overall state spending?
Now, with the rate of uninsured in Massachusetts dipping below 2%, we have some answers. The amount Massachusetts spends to help low-income, uninsured residents gain access to needed health care has increased from $1.04 billion before the law was enacted to $1.95 billion after five years of reform. Since the federal government picks up approximately half the cost, the state’s share of the increase was $453 million. In separate blogs, Archambault and Lischko have raised a series of questions about how the spending figures should be interpreted. Continue reading
Projected impact of growth scenarios on total employer savings on employer-sponsored health insurance. From "Benefits of Slower Health Care Cost Growth for Massachusetts Employees and Employers" by Jonathan Gruber and Ian Perry. (Courtesy)
WBUR’s Martha Bebinger reports that under new health payment reform (read cost-containment) plans currently underway in the state legislature, employers could save between $8 and $35 billion over nine years, according to a new analysis by MIT economist Jonathan Gruber.
That translates into direct financial benefits for workers, writes Bebinger:
Gruber says there’s a direct trade off between health care costs and wages. When premiums go up, wages don’t rise as quickly.
“What we’re saying here, by that same logic, is if we can control health care costs workers get more,” Gruber said.
In what Gruber calls a modest proposal, health care costs would increase 5 percent per year, just one point less than the expected 6 percent increase. The savings for employers would be $8 billion over nine years.
Under a more aggressive approach, health care costs would still rise, but only 2 percent per year. Employers would save almost $35 billion or about $1,000 per worker, per year. Continue reading
