We continue to face a challenging environment for both the state budget and controlling health care costs. Unknown Affordable Care Act changes, anticipated personal income tax decreases, and sluggish sales tax revenue may affect state and municipal revenues. At the same time, rising health care costs are crowding out other critical needs, including public safety and local aid. The state’s health care increase benchmark under Chapter 224 is 3.6% annually, and this has been hard to achieve with rising costs. Yes, an aging population and mandates are contributing to rising costs, but the two main drivers are:
- High-cost providers and the prevalent use of these providers
- Skyrocketing prescription drug costs
According to the Massachusetts Center for Health Information and Analysis (CHIA), 80.3% of 2014 hospital commercial payments went to the most expensive Massachusetts hospitals. The GIC’s members are also using the most expensive hospitals, with 46% of utilization in one of our largest broad network plans using Tier 3 — the most expensive — hospitals.
The GIC’s winter 2017 For Your Benefit newsletter outlined many of the reasons for skyrocketing prescription drug costs. The Health Policy Commission reported in the fall that prescription drug costs rose 8.8% from 2014-2015 and now represent 17.2% of total Massachusetts medical expenditures.
The GIC’s initial premium requests from the plans came in at 10.2% — clearly unaffordable for the state, municipalities, and members. The Commission knew that it would be able to negotiate down from this somewhat, but other changes would be needed to come in within the state’s benchmark of 3.6%. Guiding principles were to:
- Spread the burden fairly
- Align benefits between plan options
- Use methods other than benefit changes to bring down trend wherever possible.
In line with the third goal, the GIC is renegotiating our contract with CVS Caremark and continues the Centered Care Initiative to encourage our health plans to move from fee-for-service provider contracts to global budgets. The GIC’s Clinical Performance Improvement (CPI) Initiative for non-Medicare retirees/survivors that analyses 155 million de-identified claims on nationally recognized measures of quality and/or cost efficiency will continue for Fallon Health, Health New England, Neighborhood Health Plan and the UniCare State Indemnity Plan. Members of these plans pay the lowest copay for the highest-performing specialists:
*** Tier 1 (excellent)
** Tier 2 (good)
* Tier 1 (standard)
Harvard Pilgrim Health Plan and Tufts Health Plan will also tier providers to encourage non-Medicare members to shop for their care. In a major initiative, the GIC has proposed legislation as part of the Governor’s budget to cap payments to hospitals, doctors, and other providers for GIC members.
Additional benefit changes were also needed. Some of our broad network plans were spending well beyond other similar plans. These plans include Fallon Health Select Care, which proposed a 9.4% increase; Harvard Pilgrim Independence, which proposed a 6.1% increase after two consecutive years of increases exceeding 9.0%; and Tufts Health Plan Navigator, which proposed a 12.9% increase. As a result, these plans are closed to new members. This change and others are outlined on the next few pages.
Take Action to Lower Your Out-of-Pocket Costs
- Work with your Primary Care Provider (PCP) to navigate the health care system.
- Use urgent care facilities and retail minute clinics instead of the emergency room for urgent (non-emergency) care.
Eat healthy, exercise regularly, don’t smoke, and find ways to de-stress. Articles to help you take charge of your health are posted on our website.
Non-Medicare members should also:
- Seek care from Tier 1 and Tier 2 doctors.
- Access on your phone or make copies and bring the prescription drug formulary from your plan’s website with you to all doctor visits.
- If you are in a tiered hospital plan and have a planned hospital admission, talk with your doctor about whether a Tier 1 hospital would make sense.
- Use your health plan’s cost estimator for health care procedure shopping – UniCare and Fallon will send members a check if they shop for and then visit a lower-cost provider.
Take Advantage of Annual Enrollment
It’s more important than ever to review your health plan options during this year’s Annual Enrollment. Be sure to follow the Gather, Investigate and Choose and watch the Annual Enrollment video. If you are in a plan with a high premium, it’s important to take the opportunity to consider enrolling in a less expensive plan. The health plan in which you are currently enrolled may or may not be the best value for you and your family for the next fiscal year.
This information provided by the Group Insurance Commission .