For Immediate Release - July 05, 2017

New Data Shows Annual Health Care Costs in Massachusetts Exceeded $10,500 per Person in 2014, 31% Higher than U.S. Average

Yet After Years of Historically Low Spending Growth, Massachusetts is No Longer the Most Expensive Health Care State in the Country

BOSTON – Wednesday, July 5, 2017 – Today, the Massachusetts Health Policy Commission (HPC) released its analysis of new data from the national Centers for Medicare & Medicaid Services (CMS) that shows progress and continued challenges in the Commonwealth’s effort to reduce the growth of health care spending.

The new CMS data includes an important update of information about health care spending for 2010 to 2014, and serves as a validated baseline for state and national comparisons. Consistent with the HPC’s mission to reduce total health care spending growth, the CMS data examines per capita health spending for the three largest payers (Medicare, Medicaid, and private health insurance). 

The HPC analysis highlights key areas of progress and challenge, including:

  • For total per capita health care spending, Massachusetts is no longer the highest spending state in the nation – Alaska exceeded Massachusetts in spending in 2014.
  • In 2009, per capita health care spending in Massachusetts was $9,417, exceeding the national average of $6,892 by 37%. In 2014, per capita health spending in Massachusetts was $10,559, narrowing the difference to the national average ($8,045) to 31%.
  • From 2004 to 2009, Massachusetts had the sixth highest annual health care spending growth rate of all states at 6.0%. In a significant reversal from this trend, from 2009 to 2014, Massachusetts had the fourth lowest spending growth rate at 2.3%, behind only Hawaii, Arizona, and North Carolina.
  • From 2009 to 2014, Massachusetts saw a decrease in excess spending in major health care sectors, including hospitals, physician, and nursing care facilities. However, consistent with previous HPC research, Massachusetts experienced disproportionate spending increases in prescription drugs and home health care spending during this period.

“Our analysis of the new CMS data shows some progress in Massachusetts towards our cost containment goals – but affordability challenges remain. The HPC looks forward to continuing to work with all stakeholders to create a more transparent, accountable, and affordable health care system on behalf of consumers and businesses here in Massachusetts."

-- David Seltz, Executive Director of the Massachusetts Health Policy Commission

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The Massachusetts Health Policy Commission (HPC) is an independent state agency that develops policy to reduce health care cost growth and improve the quality of patient care. The HPC's mission is to advance a more transparent, accountable, and innovative health care system through its independent policy leadership and investment programs. The HPC’s goal is better health and better care – at a lower cost – across the Commonwealth.

Visit us at Mass.gov/HPC. Tweet us @Mass_HPC.

For more information on the CMS data, see recent Health Affairs Article, “Health Spending By State 1991–2014: Measuring Per Capita Spending By Payers And Programs,” David Lassman, Andrea M. Sisko, Aaron Catlin, Mary Carol Barron, Joseph Benson, Gigi A. Cuckler, Micah Hartman, Anne B. Martin, and Lekha Whittle, Health Affairs Web Exclusive, 2017