Who is a member?
Our members are the local governments of Massachusetts and their elected and appointed leadership.
The House and Senate, on May 4 and May 9 respectively, each endorsed highly anticipated legislation intended to contain health care costs and reform the health payment system for consumers and employers.
The Joint Committee on Health Care Financing, chaired by Rep. Steven Walsh of Lynn and Sen. Richard Moore of Uxbridge, has been working on the sweeping legislation, originally filed by Gov. Deval Patrick more than 14 months ago.
The legislation is being described as the next significant round of reform following landmark legislation, passed in 2006, that requires all Massachusetts residents to obtain health insurance.
Both the House and Senate bills include significant elements of the governor’s proposal.
They would:
• Establish benchmarks for health cost growth tied to the growth rate of gross state product
• Move away from the fee-for-service payment model
• Improve and expand the use of technology and medical records
• Create uniform medical information forms
• Reform medical malpractice laws
• Enhance transparency in the health care system
Two major pieces of the governor’s bill were not included by the Legislature: rate regulation of providers and enhanced powers for the Division of Insurance.
Instead, the Legislature’s bills use benchmarks and incentives to reduce the rate of health care cost growth and give more authority to the Division of Health Care Finance and Policy (renamed the Division of Cost and Quality in the House bill).
Both legislative bills call for an elimination of the fee-for-service system, which pays providers for the quantity of services provided, not the quality, and take a flexible approach on how to get there.
The bills call for the establishment of accountable care organizations, groups of doctors spearheaded by a primary care physician, global payments, a set dollar amount designated for the treatment of each patient, and other options for providers to move away from the fee-for-service model.
One stark difference between the House and Senate bills lies in the annual heath care cost growth benchmarks.
The House bill calls for limiting health cost growth to half a percent below the growth in the gross state product. The Senate’s eventual target is the gross state product growth rate and then gross state product plus 1 percent. In choosing its less restrictive cost containment target, the Senate cited a fear of major layoffs in one of the state’s largest industries.
Business groups, however, such as Associated Industries of Massachusetts, have called for an even more aggressive target of gross state product minus 2 percent in three years, claiming that eliminating the up to 30 percent of medical health care spending that is wasteful would help reach the goal without reductions in the workforce.
If passed, the legislation is expected to save $160 billion over the next 15 years, with the average family plan being reduced by $2,000 annually within five years. The differences between the two bills will be worked out in a conference committee, with a goal of sending a bill to the governor by the end of the legislative session on July 31.