The ever-expanding cost of health care is a punishing annual reminder that while Massachusetts is a national leader in medicine, the state still struggles to get a firm grip on controlling local care costs..
A panel of state appointed experts charged with curtailing rising fees voted Wednesday to allow no more than a 3.1 percent increase, setting the stage for the state to become more active in forcing the medical market to keep costs down.
“I think Massachusetts has an obligation to the citizens of the Commonwealth to do everything possible to continue to curtail spending growth in order to have spending for other important things in the Commonwealth of Massachusetts and to continue to signal to the market that that is very important,” Mary Lou Sudders, Gov. Charlie Baker’s Health and Human Services secretary, said before the vote.
Consumer and business spending aside, health care constitutes 56 percent of total state spending.
Sudders said the goal of the cost regulators should be to “use its bully pulpit” to focus on “really targeted conversations particularly on the high cost parts of our healthcare system.” Sudders wants an end to “very polite dog and pony shows” of the past.
Five years ago, in an attempt to control costs, the legislature created the Health Policy Commission and granted it authority to establish a benchmark for how high costs could rise.
The schedule for the benchmark allowed five years of cost growth equal to the state’s economic growth, between 2 and 3.5 percent annually.
The schedule sets 2018 as the first year the benchmark will drop – by half a percentage point,.
HPC, however, has the authority to raise it back up if necessary.
The panel could have chosen to adopt a more modest cost increase, up to 3.6 percent. By allowing the lower 3.1 percent to go through, the HPC and Baker administration are insisting the market work more energetically for lower costs.
“This involved change,” said Don Berwick, a pediatrician on the panel and a former Democratic candidate for governor.
“The organizations that deliver care are going to have to change in order to make this happen. It’s not that they don’t want to, but it’s hard to do that,” Berwick said.
Health cost expansion has been over the benchmark since the law’s passage, according to the Center for Health Information and Analysis, another state monitor.
There is no statutory ramification for failing to meet the benchmark.
“So if this is really going to happen and we’re not just setting an artificial number because we have the bully pulpit, then I think we’re going to have to be incredibly imaginative, creative, proactive, all of those great words, in order to really help the entire community, providers, payers, change to achieve that,” HPC vice chair Wendy Everett said in support of the lower rate.
