New Contracts Help Change Delivery of Health Care, Put Health Plans on a Budget, and Achieve

a Low 3.5% Premium Increase


BOSTON – Wednesday, March 6, 2013 - Building on the Patrick-Murray Administration’s efforts to lower costs and ensure access to quality, affordable care, the Group Insurance Commission (GIC) today voted to contract with six carriers that will establish integrated systems of care and commit to keeping the 2014 premium increase at 3.5 percent.

“The GIC has once again shown we can deliver high quality care at lower cost,” said Governor Deval Patrick. 

The contracts with Fallon Community Health Plan, Harvard Pilgrim Health Care, Health New England, Neighborhood Health Plan, Tufts Health Plan, and UniCare will begin July 1, 2013.  The new, five-year contracts include modest benefit enhancements and changes, including additional wellness benefits.  In contracting with these plans, the GIC was able to hold the 2014 premium increase at a 3.5 percent, far less than the 7.4 percent increase of average 2014 employer trends without benefit cuts, according to Mercer National Survey of Employer-Sponsored Health Plans.

“The Health Care Payment law charged the state with taking the lead on moving paying for care based on its quality instead of its quantity,” said Secretary of Administration and Finance Glen Shor. “These new contracts are critical steps in implementing that goal and making long overdue changes in the health care delivery and payment systems.”

“We are leading the charge on a major shift in the delivery of health care and will work with our plans and the provider community to help with the transition,” said GIC Executive Director Dolores L. Mitchell.  “By emphasizing better coordination of care, everyone will benefit, and we will achieve the triple aim of achieving better patient care, better population health and lower per capita costs.”

Under provisions of Chapter 224 and the new contracts, the health plans will have financial incentives for achieving budget targets and adopting new payment systems.  If they do not meet the benchmarks, they will be subject to penalties.  The GIC’s new approach emphasizes coordinated care, price transparency, and new ways of paying providers – shifting from fee-for-service to some form of global payments.  Members will be encouraged to select a Primary Care Provider (PCP) to coordinate their care. They will also have the option to choose a Nurse Practitioner or Physician Assistant as their PCP.  State and participating municipal employees and retirees will receive details about their plan options before Annual Enrollment begins on April 10, 2013.  Enrollees will be able to review their benefit options during the enrollment period that runs until May 8, 2013 for changes effective July 1, 2013.

The Health Care Payment law, signed by Governor Patrick on August 6, 2012, requires state-funded health insurance programs like MassHealth and the GIC to use global and other alternative payments to achieve savings for taxpayers. It also encourages alternative delivery systems across health care fields to deliver additional savings for patients, business owners and working families

The GIC was established by the Legislature in 1955 to provide health, life, and other benefits to state employees, retirees, and their dependents. The GIC also covers housing and redevelopment authorities' personnel, participating municipalities, and retired municipal employees and teachers in certain governmental units.  There are currently over 220,000 members and over 400,000 lives covered by the GIC.  A seventeen-member commission representing labor, retirees, municipal management, the public interest, the Administration, and expertise in health economics governs the GIC.


This information provided by the Group Insurance Commission.