5.1 Contain the increasing cost of health care while protecting access and quality (three action items)

5.1.1 Continue to move away from fee-for-service health care payments and towards value-based global payments, with the goals of converting most health care payments (public and private) to other than fee-for-service by 2014 and of reducing disparities in pricing for services of comparable quality

Contact: Alec Loftus

CY2012 Progress:

Overview of the Healthcare Cost Containment Law:

Achieve Billions in Savings:

  • Sets a first-in-the-nation target for controlling the growth of health care costs.  The law holds the annual increase in total health care spending to the rate of growth of the state’s Gross State Product (GSP) for the first five years, through 2017, and then even lower for the next five years, to half a percentage point below the economy’s growth rate, and then back to GSP.
  • Results in nearly $200 billion in health care cost savings over the next 15 years, which will lead to up to $10,000 in additional take-home pay, per worker, over 15 years.
  • The average family will see an estimated savings of $40,000 on their health care premiums over 15 years.

Move to Alternative Payments:

  • To control costs and improve quality of care, the law requires government agencies like MassHealth, the GIC, and the Connector to use global and other alternative payments to achieve savings for taxpayers.
  • Encourages alternative delivery systems across health care fields to deliver additional savings for patients, business owners, and working families.

Increase Transparency:

  • The law also gives consumers better information about the price of procedures and health care services by requiring health insurers to provide a toll-free number and website that enables consumers to request and obtain price information.

Address Market Power:

  • To monitor and address the market power and price disparities that can lead to higher costs, the law allows a Health Policy Commission to conduct a cost and market impact review of any provider organization to ensure that they can justify price variations.  The law identifies triggers for when a provider or provider organization will be referred to the attorney general for investigation.  An independent Center for Health Information and Analysis will conduct data collection and reporting functions.

Promote Wellness:

  • The law creates a Wellness Fund of $60 million administered by the Massachusetts Department of Public Health for competitive grants to community-based organizations, health care providers and regional planning organizations.

Enact Malpractice Reform:

  • The law includes malpractice provisions proposed by Governor Patrick, requiring a “cooling-off” period before a party may initiate a suit, while making providers’ apologies inadmissible as evidence.  Many studies show that an apology can prevent a lawsuit but due to the threat of litigation, providers have oftentimes remained silent.

Support Health Information Technology:

  • Massachusetts is already a national leader in adopting electronic health records and health IT efforts.  The law complements these efforts, by advancing several health information technology programs, including the Executive Office of Health and Human Services' work with the Obama Administration to build and operate the statewide health information exchange.

Director of the Center for Health Information and Analysis Named

5.1.2 Continue to enhance the role of consumer information and consumer choice, building on recent movements towards selective networks and tiered health care insurance products

Contact: Barbara Anthony or Joseph Murphy

CY2012 Progress:

  • Office of Consumer Affairs and Business Regulations (OCABR) and the Division of Insurance (DOI) hosted seven consumer awareness and education events in communities across the Commonwealth.
  • DOI updated several consumer education publications in print/web format.

5.1.3 Accelerate use of e-health technologies to support lower cost delivery of health care with equal or greater access and improved quality

Contact: Laurance Stuntz

CY2012 Progress:

  • Launched Medicaid Electronic Health Records (EHR) Incentive Payment Program -- more than 3,000 providers receive payments totaling more than $130 million.
  • Launched Massachusetts Health Information Highway (the HIway)
    • Reduce administrative costs throughout the delivery system
    • Improve public health reporting and analytics
    • Enhance patient care communication among providers
    • Increase patient engagement with providers on care plans