Center for Studying Health System Change: Boston Report

September 6th, 2010 | Healthcare Reform

In a report released September 2, 2010 – that I have been awaiting since 2007 – the Center for Studying Health System Change confirms what many observers including myself have independently determined about the Reform in Massachusetts that was used as the Model for the Federal Reform: 1) Massachusetts is an anomaly of limited relevance to the Nation – which itself is a series of anomalies.  Academic Medical Center dominance along with specialist concentration and the highest per capita concentration of physicians in the country are at the  core of that limited relevance as is a high per capita income; 2) the cost inflation in the small group insurance market as a result of merging that market with the individual market has been nearly DOUBLE that anticipated – and I would maintain from my personal experience that it is closer to FIVE times the level indicated in the HSC report; 3)  Hospitals – the BIG winners in Massachusetts’ Reform and again in the federal Reform – are driving the Cost Explosion Train; 4) reading between the lines, lack of Antitrust Reform, the threat of which was much ballyhooed during the purported debate on Federal Reform, has led to the ability of the provider community to raise rates willy-nilly (a technical term) which the Health Plans estimate contribute to 50% of the cost increase trend. The problem originates with the McCarran-Ferguson Act exemption for insurers, which led to provider consolidation in the 1990s and 2000’s and the collapse of price competition; 5) MA Attorney General Martha Coakley – the victim of Senator Scott Brown’s Senate Campaign – exposed the pricing anomalies in an incredibly detailed February, 2010 Report with data that only a government official with subpoena power or an experienced healthcare consultant could have obtained.

The mess created by 4 years of Reform in Massachusetts – which includes high unemployment unrelated to the Recession –  finally required remedial action by the Executive and legislative branches in the last 6 months. Facing likely defeat in his reelection bid, the governor instructed his insurance commissioner to deny rate increases in the merged small group market of 10% to 30%, which were partially allowed in settlements reached between June and August. The legislature voted to permit small business to form purchasing cooperatives – or association health plans, which were banned by the state in 1996! – this past July.

Read the Report here

Read about the nonpartisan Center for Studying Health System here: which is funded by the Robert Woods Johnson Foundation.

Sometimes, the Truth hurts.

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