Health Care in Massachusetts 2012: The Way I See It

Tuesday, May 29, 2012

by Governor Deval Patrick

This month, we celebrate the sixth anniversary of Massachusetts health care reform.  Our reforms are an expression of values, a codifying of our belief that health is a public good and that everyone deserves access to affordable, high-quality care.  

Like President Obama’s Affordable Care Act, we took a hybrid approach, relying mainly on private insurance provided through the workplace, with varying degrees of public subsidy, depending on a person’s ability to afford private insurance.  

It’s working.  Today, more than 98% of Massachusetts’s residents have health care coverage, including 99.8% of children. No other state in America can touch that. More companies offer their employees insurance today than before the bill was passed.  More than 90% of our residents have a primary care physician and four out of five have seen their primary care doctor in the last year.  Emergency room visits for primary care are down and spending on the uninsured and underinsured has dropped by nearly half.  

We’re healthier, too.  For example, because of access to screenings, we’ve seen a 36% decrease in cervical cancer in women.  

All of this while adding about 1% to state spending on health care.

Those are the numbers; but policy matters most when it touches people.  And this policy touches people. I remember meeting a young woman named Jaclyn Michalos, a cancer survivor who got the care she needed through the Commonwealth Connector, our version of the Exchange. She had no affordable way to receive the care she needed before Massachusetts’ health care reform – it saved her life.  People no longer have to fear having their insurance cancelled when they get very sick and need it most, or that a serious illness will leave them bankrupt.  Health care reform in Massachusetts is helping people in profound ways.

Our next challenge is slowing the growth in health care premiums.  This is a national problem, one neither caused by our reform nor unique to Massachusetts.  Spending on health care makes up 18% of all spending in the United States and is projected to reach 34% by 2040 if costs continue to grow at historic rates.  In recent years, growth in health care costs has outstripped growth in GDP even as the share of Americans with health insurance has fallen.  In many ways, this will be harder to solve than universal access.  But we need to solve it.  

As spending on health care programs and emergency care grows, it weakens our ability to compete and slows job growth.  In budgets everywhere – families, businesses and governments alike – spending on health care comes at the expense of spending on education and other basic needs. Left unchecked, health care costs threaten our fiscal integrity and our ability to provide future generations with the services we have enjoyed.

Just as we in Massachusetts have provided the national model for universal access, I believe we are on track to crack the code on cost control.

We have already seen significant progress. Two years ago, I directed the state’s Commissioner of Insurance to disapprove excessive premium hikes.  While an admittedly blunt tactic and not in and of itself a long-term solution, it was a necessary step to galvanize the market to act.  Massachusetts is home to an innovative, world-class health care community and they have responded with real solutions.

Hospitals and insurance carriers have reopened their contracts and cut rate increases, in some cases by more than half. We’ve created limited network health plans to give consumers opportunities to get great care in neighborhood settings at lower cost.  There are new plans coming out tailored for small businesses that promise to be as much as 20% cheaper than current rates.  Our new Wellness Track program offers a 15% rebate for certain small business owners who take part in the wellness program.  We are also ending administrative duplication by requiring common codes and forms from insurers and providers.  And with the help of the Affordable Care Act, more and more providers are piloting medical home or accountable care models that manage wellness for the whole person, and deliver both better care and more cost-effective care.  

All of this is making a difference.  In the last two years, average premium increases have since dropped from over 16% to less than 2% today. Our focus now is on making these gains last. 

There are a number of strategies we are pursuing, including putting an end to the “fee-for-service” model wherever practicable, to stop paying for the amount of care and start paying instead for the quality of care.  We need to empower doctors to coordinate patient care and to focus on wellness rather than sickness. 

We are working with our health care community to accelerate this transition to innovative models for delivering health care, in which incentives are realigned to reward integrated care that emphasizes wellness and lowers costs for everyone.  For example, Blue Cross Blue Shield has persuaded some of the state's biggest hospitals and thousands of doctors to accept a fixed amount each month per patient rather than receive payment for each individual procedure. 

In state government, by using these new tools and new approaches to how we pay for care, we will avoid nearly a billion dollars in cost increases in this fiscal year and another several hundred million more next year. Our goal is for integrated, cost-efficient caregiving to predominate throughout Massachusetts by 2015.

This is a complex challenge but we are making great progress and will be successful in the end. We have no choice.  For us, and for this country, solving the health care challenge has everything to do with fulfilling our generational responsibility – that old-fashioned idea that each of us in our time must do all we can to leave things better for those who come behind us.  This challenge belongs to all of us, from whatever party or no party.  We owe it to our future to get this right.