November 21, 2011 | last updated May 16, 2012 4:38 pm

Health Care Reform Enters Stage II

Five years ago, Massachusetts became the first state in the nation to mandate health insurance - which ultimately paved the way for a national debate on health care reform. In its wake, we were left with a new system on a steep learning curve, and no abatement in the rapid rise of insurance premiums. In 2010, state officials initially rejected about six of every seven rate increase requests for small business insurance plans. Those in the health insurance industry were not pleased, claiming Beacon Hill had overstepped its authority while not addressing the underlying cost of care provided.

Today, the costs remain high, and the public and medical community — according to the results of a recent survey by the Blue Cross Blue Shield Foundation of Massachusetts — agree that government should again take the lead, this time with the focus on reducing the financial burdens of health care.

That message was not lost on the Patrick administration as Massachusetts enters a second phase in this brave new world: reforming the way health care is delivered and paid for to help bring down those costs. The commonwealth's embrace of a "global payments" system, which would reward provider networks for keeping patients healthy, has the potential to lower costs and focus more attention on patients who need more intensive care, such as those with chronic illnesses. In theory, this would replace the traditional "fee-for-service" system that focused more on fixing health problems after they happened than on advising patients on how to stay well in the first place.

The time is right for this transition. The baby boomers, most of whom are in their 50s and 60s, place a much greater emphasis on wellness than their predecessors did. There is also a plethora of information at consumers' fingertips that stresses healthy habits. During her 2008 presidential run, Hillary Clinton underscored the need for a change in health care delivery by citing how health insurers would pay for a diabetic to have his foot amputated but not for seeing a nutritionist who could help him eat the right foods that would help him better manage his condition. The implication being, not only did it make more sense to practice prevention, it also costs a lot less that the alternative. Insurers have developed some programs to reward wellness, specifically the rebates they offer subscribers for their health club memberships, but more must be done.

As in any business, there are customers in health care that need a lot of attention and others who need very little. A global payments system has the potential to account for just that: take costs out of the system and allow health care providers to pay more attention to patients whose conditions truly warrant it. Here in Central Massachusetts, Reliant Medical Group (formerly Fallon Clinic), for one, is pursuing a similar strategy by focusing on preventative measure to help patients avoid developing chronic diseases that could end up costing the system more, while also looking for ways to provide more day-to-day care efficiently. CEO Jack Dutzar said Reliant already gets about 60 percent of its revenue from the global payments model — but he admits adoption has been slow.

At the national level, change is universally slower, and the polarized political environment has made the chance of any further reforms coming out of Washington slim to none. The controversial Health Care Reform Act, signed into law in 2010, has focused much attention on the issue, but the national debate centers more around how much the government should be involved in health care than about whether it can make a difference in reducing costs. While the challenges to that law meander their way through the courts, Massachusetts has a golden opportunity to move to Stage II of its reform effort — changing health care delivery and outcomes for the better and showing that government can play a vital role in driving needed reforms to our health care delivery system.

Once again, the nation will be watching.


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