October 7, 2014

Health care stakeholders size up cost-control bid

Massachusetts is heading in the right direction on health care cost control and doing better than the rest of the country, experts said Monday, while cautioning that costs would continue to grow and raising the possibility of future changes to the state's 2012 cost containment law.

A September report from the Center for Health Information and Analysis (CHIA), which measured total Bay State health care expenditures by private and public payers, found that expenditures in 2013 increased 2.3 percent per resident, 1.3 percent below the benchmark.

"While we think we have better mechanisms here in Massachusetts to deal with it, no one is completely comfortable that we do," Dr. Stuart Altman, chair of the Health Policy Commission, an independent state agency, said during a break in the annual two-day hearing examining cost trends that commission is overseeing. "So I think everyone is saying to us, 'Okay, we're doing okay in the short run but you gotta keep at it.' We really haven't solved the problem yet."

Rep. Jeffrey Sanchez, a Jamaica Plain Democrat who co-chairs the Legislature's Joint Committee on Public Health, said he is "cautiously optimistic" about the overall health cost trends.

"The real test for us in Massachusetts will be to place our progress in the coming years in the context of shifting national health care spending trends," he told the commission. "Even in state-specific data, we continue to see areas of concern. We are still spending more per capita: about $7,500 per resident; 60 percent of our total health expenditures is public spending; we continue to spend more on long-term care than any other state; and we rely on high cost, high intensity settings for the majority of our care."

The commission's 11 members also took testimony from Harvard Medical School's Michael Chernew as well as top officials in the health care world.

"Health care spending growth has slowed dramatically in the nation and even more so in Massachusetts over the past several years, and that's a good thing," Chernew told the News Service. "It is important to maintain that momentum and that requires continued attention of all stakeholders, providers, payers and in particular the policy commission."

Officials from Beth Israel Deaconess Medical Center, Blue Cross Blue Shield of Massachusetts, Partners HealthCare System and UMass Memorial Medical Center appeared together on a panel.

In his testimony, Gary Gottlieb, the president and CEO of Partners, took issue with some of the numbers in the CHIA report, which said Partners had higher cost increases.

Gottlieb called the data incomplete and said Partners' performance was below the benchmark. The head of one of the state's largest commercial payers, Blue Cross Blue Shield of Massachusetts CEO Andrew Dreyfus, said they also came in below benchmark.

"This is a long run, a long haul," Gottlieb told the commission, adding that the industry's collective focus can't be on one or two-year periods, but on lowering the health spending trajectory over a longer period.

"We're looking at the best available measures," Aron Boros, CHIA's executive director, said in response, adding that his metrics may not be the ones Gottlieb prefers to point at.

At the end of the panel, Altman raised the possibility of changes to Chapter 224, the cost control legislation passed in 2012 and followed the healthcare reform law in 2006. Altman, the commission chair, asked them to consider if there are other mechanisms the state should have in order to control costs and get back to the commission.

"I don't want to pre-judge their answer," Altman said after the panel, when asked if he had any mechanisms in mind. "Some people might say it's fine, others might give the state more power."

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