Last night, the state senate struggled through a dry debate on a complex package of health care cost-control measures. The challenge is to see through the legalese to the underlying choices.
Some years ago, with a beer in one hand and a cigarette in the other, a friend’s uncle casually mentioned he was getting ready for his second heart transplant at state expense. The life style choices that we all make do contribute to the inexorable pressure of rising health care costs.
The recommendations that doctors make also contribute to rising health care costs. In my 30s, I developed frequent heart burn. A doctor told me I faced a choice – either risky surgery involving a week of hospitalization under his care or a lifetime of taking heart burn drugs that raise the risk of stomach cancer. He didn’t identify the third possibility, the one I chose – maybe I just shouldn’t eat and drink so much right before going to bed.
Of course, much of health care is both necessary and unavoidably expensive. Most of expensive health care occurs at the end of life. The trick is that it’s hard to know when the end of life is going to be.
In April 2001, I was feeling tired when I shouldn’t, falling asleep in morning meetings. Long story short, I suddenly found myself in the hospital facing surgery for a brain tumor. They told me I was close to death, but the tumor looked like it might be benign. This was not to be my final health care episode. Seven days, a lot of doctors and over $50,000 later, I was out of Mass General and on my way to a full recovery.
The bill for that episode included charges from many different professionals and the hospital itself. The allocation of income among all those providers is a hugely complex struggle, much of which occurs out of public view at corporate negotiating tables.
In 2012, the legislature passed a comprehensive health care cost-control bill which created the Center for Health Information Analysis. CHIA’s charter is to analyze health care claims data to create more transparency around all of these decisions. CHIA supports the work of a second entity created in the same legislation, the Health Policy Commission, that has the charter to bend the curve of health care cost growth.
The legislation that we passed last night builds on (1) the 2012 legislation, (2) the work of CHIA and HPC (3) the work of a Special Commission on Provider Price Variation which recently produced a report on wide difference in prices between the downtown teaching hospitals and the small community hospitals and (4) the work of a group of senators who have spent the last year studying what more we can do to reduce the growth of health care costs, a question of huge significance to most public and private institutions and especially for the state which bears the burden of funding MassHealth.
The major ideas in the legislation include:
In addition to these ongoing challenges, the legislation includes a number of measures to discourage shifting from employer-sponsored insurance to Mass Health and also allows employers to buy into an optional expanded MassHealth plan. The legislation does not alter eligibility for MassHealth.
Collectively, the new rules and mechanisms in the bill add up to a significant effort to control costs and improve quality by influencing the choices of consumers, providers and insurers. The bill does also include a new task force to increase efficiency through regulatory simplification.
A single payer approach might reduce some of the complexities of our system. Yet, if we tried it at the state level, it would create a huge funding challenge and it would not eliminate the fundamental dilemmas of health care outlined above. On the floor, we added a study to compare to examine how single payer health care might perform compared to the mechanisms we created.
The legislation now moves to the House. The House will not take it up until some time next year.
Senate Passes Sweeping Healthcare Reform and Cost Containment Bill
Result of yearlong effort to address rising costs and consumer protections
BOSTON-Today the Massachusetts Senate passed sweeping healthcare reform legislation S.2022, An Act Furthering Health Empowerment and Affordability by Leveraging Transformative Health Care. The HEALTH act, passed by a vote of 33-6, focuses on both short and long terms goals on how to fix our healthcare system to lower costs, improve outcomes, and maintain access. The legislation is the result of effort by a group of Senators, The Special Senate Committee on Health Care Cost Containment and Reform, addressing the healthcare system by analyzing the best practices in other states and engaging stakeholders in a series of meetings over the last year.
“Massachusetts continues to lead on healthcare, and having a robust economy depends upon lowering costs for everyone without compromising quality or access. This bill will help working families, businesses, and our state budget,” said Senate President Stan Rosenberg (D-Amherst). “I’m very proud of the work the Senate did to craft a comprehensive report and draft legislation that touches so many aspects of our healthcare system and meets the needs of all engaged stakeholders.”
“Passing The HEALTH Act is a phenomenal step forward for health care in the Commonwealth,” said Senator James T. Welch (D- West Springfield). “Once again, we are setting an example for the nation by creating a health care system that will, among many things, maximize the impact community hospitals can have on our citizens, while keeping costs in check.”
Healthcare costs are continuing to strain the budgets of working families, businesses, municipal and state governments. The Senate has continued to push for reforms to the current system through diligent research, stakeholder engagement, and legislation. The working group of Senators, with the logistical support of the Milbank Memorial Fund spent the last year meeting with officials from seven states, healthcare experts, and stakeholders to examine best practices while lowering costs and improving outcomes.
“The Massachusetts Senate has worked long and hard to craft this plan to contain ever inflating prices and improve the quality of care,” said Senate Majority Leader Harriette Chandler (D-Worcester). “Each member was given the opportunity to contribute to the deliberations and debates when structuring this bill – making this a truly representative effort for the entire Commonwealth. Nevertheless, inflating costs are more than a Massachusetts concern, and I hope this legislation serves as a model for the rest of the nation.”
The bill implements more effective care delivery such as telemedicine and mobile integrated health, to reducing emergency room visits, to expanding provider versatility while also addressing price variation between larger hospitals and their smaller community hospital counterparts.
A recent study by the University of California Davis Health system estimates that “by using telemedicine for clinical appointments and consultations, its patients avoided travel distances that totaled more than 5 million miles. Those patients also saved nearly nine years of travel time and about $3 million in travel costs.”
“Everyone deserves access to high quality health care at a fair price,” said Senator Karen E. Spilka (D-Ashland), Chair of the Senate Committee on Ways and Means. “Massachusetts has always been a leader when it comes to healthcare, and this legislation is the next step in our efforts to protect and empower consumers, encourage innovative healthcare and ensure access and affordability. Our goal is long-term cost savings for the state, without sacrificing our unwavering commitment to high quality coverage for all.”
The bill aims to reduce hospital re-admissions and emergency department use through mobile integrated health and telemedicine as well as expanding access to behavioral health. The Massachusetts Health Policy Commission has estimated that 42 percent of all emergency department visits are avoidable.
The bill aims to tackle provider price variation, the variation between providers for similar procedures, by implementing a floor for providers while also setting a benchmark for hospital spending. If hospitals exceed the benchmark the state will implement fines or penalties on those institutions.
“This important legislation takes meaningful steps to both improve healthcare quality and outcomes, as well as contain costs,” said Senator Jason Lewis (D-Winchester). “More deeply, this legislation furthers efforts to address the social determinants of health that are responsible for many health inequities in our system; and, innovative steps are taken to make prevention a more central component of our healthcare system, which will improve our quality-of-life and save money.”
Post-acute care in an institutional setting and long term care and supports (LTSS) cost the state an estimated $4.7 billion in 2015, a major cost driver for MassHealth. The bill increases transition planning for patients into community settings and strengthening coordination between providers.
“Too often emergency rooms are the only options for individuals struggling with behavioral health and addiction. This comes at a high cost to the system and to families, and this over-reliance on emergency rooms is not the way to address behavioral health and the opioid crisis, said Senator John Keenan (D-Quincy). “So we are presenting effective alternatives – new urgent care centers, Mobile Integrated Health, innovative programing by community health centers, and other ways to get people into the right care setting.”
Pharmaceutical costs have been a driver of increased healthcare costs for a number of years. The Center for Health Information and Analysis (CHIA) reported a 6.4 percent growth in pharmaceutical spending in 2016. Drug costs are making families choose between filling prescriptions and paying for other essentials like housing and food. The bill implements greater oversight and transparency in drug costs and encourages Massachusetts to enter into bulk purchasing arrangements, including a multistate drug purchasing consortium like other states, to lower costs and protect consumers.
“We spent years working towards a strong transparency package and we finally have it with this bill,” said Senator Mark Montigny (D-New Bedford)
The legislation encompasses the whole system from Medicaid to the commercials market, addresses price variation, increases price transparency for consumers, leverages better federal funding opportunities, and expands scope of practice for many practitioners including dental therapists, optometrists, podiatrists, and nurse anesthetists.
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