After Obamacare … look to Massachusetts

2013

The health law in Massachusetts is often touted as the successful forerunner of Obamacare and a Republican effort (greatly modified by Democrats) to boot. Indeed, the law greatly expanded coverage and the state has a very low uninsured population. What isn’t low are its health care costs. The state has the highest per capita spending on health care in the U.S. except for the District of Columbia. Imagine that, health care reform and no cost control. 😏 In 2012 the State took on costs (sort of) with a sweeping new law to make costs transparent and to set a state spending target and to take action against health care providers that increase spending beyond what the state says should be spent. 👀

Part of the law requires insurance companies to tell patients in advance what a service or procedure costs. Let me say that again, requires insurance companies to tell patients in advance what a service or procedure costs, not the provider, the insurance company. Do you see anything wrong with that? Who do you negotiate the price of a car with, the seller or your auto insurer?

In any case, the real point is that Obamacare will face the same issues as Massachusetts. Expanded coverage followed by growing costs. Despite the lull in health care inflation in some areas, Obamacare is not lowering health care costs, so there will be a phase two.

Scan the following excerpts I have copied from the MA law to get a sense of the state government involvement in health care. Pay special attention to the last section I have placed in bold.

Section 16T. (a) There shall be a health planning council within the executive office of health and human services, consisting of the secretary of health and human services or a designee who shall serve as chair, the commissioner of public health or a designee, the director of the office of Medicaid or a designee, the commissioner of mental health or a designee, the secretary of elder affairs or a designee, the executive director of the center for health information and analysis or a designee, the executive director of the health policy commission or a designee and 3 members appointed by the governor to of whom shall be a health economist; 1 of whom shall have experience in health policy and planning and 1 of whom shall have experience in health care market planning and service line analysis.

The council shall assemble an advisory committee of not more than 13 members who shall reflect a broad distribution of diverse perspectives on the health care system including health care providers and provider organizations, third-party payers both public and private, consumer representatives and labor organizations representing health care workers. The advisory committee shall review drafts and provide recommendations to the council during the development of the plan.

The executive office of health and human services with the council shall conduct at least 5 public hearings in geographically diverse areas, on the plan as proposed and shall give interested persons an opportunity to submit their views orally and in writing. In addition, the executive office may create and maintain a website to allow members of the public to submit comments electronically and review comments submitted by others.

The state health plan shall identify needs of the commonwealth in health care services, providers, programs and facilities the resources available to meet those “needs; and the priorities for addressing those needs.

(b) The state health plan developed by the council shall include the location, distribution and nature of all health care resources in the commonwealth and shall establish and maintain on a current basis an inventory of all such resources together with all other reasonably pertinent information concerning such resources. For purposes of this section, a health care resource shall include any resource, whether personal or institutional in nature and whether owned or operated by any person, the commonwealth or political subdivision thereof, the principal purpose of which is to provide, or facilitate the provision of, services for the prevention, detection, diagnosis or treatment of those physical and mental conditions experienced by humans which usually are the result of, or result in, disease, injury, deformity or pain.

The plan shall identify certain categories of health care resources including acute care units; non-acute care units; specialty care units including, but not limited to burn, coronary care, cancer care neonatal care, post-obstetric and post operative recovery care, pulmonary care, renal dialysis and surgical, including trauma and intensive care units; skilled nursing facilities; assisted living facilities; long-term care facilities; home health, behavioral health and mental health services; treatment and prevention services for alcohol and other drug abuse; emergency care; ambulatory care services; primary care resources; pharmacy and pharmacological services; family planning services; obstetrics and gynecology services; allied health services including/ but not limited to/ optometric care/ chiropractic services, dental care and midwifery services; federally qualified health centers and free clinics; numbers of technologies or equipment defined as innovative services or new technologies by the department under section 2SC of chapter 111; and health screening and early intervention services.

The plan shall also make recommendations for the appropriate supply and distribution of resources/ programs/ capacities, technologies and services identified in the second paragraph of this subsection on a state-wide or regional basis based on an assessment of need for the next 5 years and options for implementing such recommendations. The recommendations shall reflect at least the following goals: to maintain and improve the quality of health care services; to support the state/s efforts to meet the health care cost growth benchmark established under section 9 of chapter 6D; to support innovative health care delivery and alternative payment models as identified by the commission; to reduce unnecessary duplication; to support universal access to community-based preventative and patient-centered primary health care; to S 2400 reduce health disparities; to support efforts to integrate mental health, behavioral and substance use disorder services wi,th overall medical care to reflect the latest trends in utilization and support the best standards of care and to rationally distribute health care resources across geographic
“regions of state based on the needs of the population on a statewide basis, as “well as, the needs of particular geographic areas of the state.

(c) The department shall issue guidelines, consistent with the state health plan for making determinations of need. If the commissioner determines that statutory changes are necessary to implement the plan, the commissioner shall submit legislative language to the joint ‘”committee on public health and the joint committee on health care financing.

(d) The department may require health care resources to provide , information for the purposes of this section and may prescribe by regulation uniform reporting requirements. In prescribing such regulations the department shall strive to make any reports required under this section of mutual benefit to those providing, as well as/ those using such information and shall avoid .placing any burdens on such providers which are not reasonably necessary to accomplish this section. Agencies of the commonwealth which collect cost or other data concerning health care resources shall cooperate with the department in coordinating such data with information collected under this rules or regulations.

********

Section 9. (a) Not later than April ·15 of every year, the board shall establish a health care cost growth benchmark for the average growth in total health care expenditures in the commonwealth for the next calendar year. The commission shall establish procedures to prominently publish the annual health care cost growth benchmark on the commission’s website.

(b) The commission shall provide notice to all health care entities that have been identified by the center under section 18 of chapter 12C as exceeding the health care cost growth benchmark for any given year. Such notice shall state that the center may analyze the cost growth of individual health care entities and, beginning in calendar year 2016, the commission may require certain actions, as established in this section, from health care entities so identified.

(e) For calendar year 2015, if the commission finds, based on the center’s annual report, the commission’s annual cost trend hearings or any other pertinent information, that the average percentage change in cumulative total health care expenditures from 2013 to 2014 exceeded the average health care cost growth benchmark from 2013 to 2014, and in order to support the state’s efforts to meet future health care cost growth benchmarks, as established in section 9, the commission shall establish procedures to assist health care entities to improve efficiency and reduce cost growth by requiring certain health care entities to file and implement a performance improvement plan.