The second groundbreaking DHCFP report, issued today, is the summary of findings and new recommendations of the cost trends process authorized by 2008’s chapter 305. All of the materials regarding the cost trends project are at www.mass.gov/dhcfp/costtrends; today’s final report, along with a 5-page summary and appendices are here. (see also the Commissioner’s blog)
The report summarizes the preliminary reports and the three days of hearings – a seminar, actually – on state health marketplace and how to control rising costs. Most important are the Patrick administration’s recommendations, divided into short-term interventions and long-term solutions:
First, immediate actions are presented to address the urgent problem of rising health care costs, including:
• Pursue and leverage federal reform opportunities to fund innovation in cost control in Massachusetts;
• Implement immediate oversight of health insurance premiums and provider rates;
• Develop market-oriented health insurance products and government tools that will address premium volatility and lower premiums for consumers and employers; and
• Initiate legislative review of provider contract provisions that may now limit competition.
Second, the report presents a longer-term framework for developing an integrated and sustainable health care system which incorporates five key components:
• Oversight and direction provided by an independent public entity;
• Payment reform involving all payers;
• Support for health care delivery system redesign and system-wide adoption of health information technology;
• Transparency of cost and quality information; and
• Investment in evidence-based public health and wellness initiatives.
Although these strategies will take a number of years to implement, steps need to be taken immediately to move toward these goals. These fundamental changes to the delivery and financing of health care are critical to the Commonwealth’s long-term success in mitigating health care cost increases while also improving quality.
The summary/fact sheet presents the recommendations in a clear, concise chart, setting out the steps required for each component, the target goal, whether legislative or regulatory action is needed, and the time frame.
The report does not flinch at the call for oversight of premiums and provider rates: “It is essential that government plays an active role to ensure the health care marketplace functions appropriately and moves expeditiously to address rising costs when it does not…. Oversight of health insurance premiums and provider rates are admittedly blunt tools with which to influence health care cost growth. However, the economic imperative is critical enough to warrant their use as temporary means of providing relief to the businesses and families of the Commonwealth while adjustments are made to develop a fully integrated health delivery system.” The report acknowledges that this must be done flexibly, rejecting flat rate freezes that lock in current inequities. The report also recommends review of anti-competitive clauses in insurer-provider contracts that interfere with normal market give and take.
The long-term recommendations introduce a new term, ICO, standing for Integrated Care Organizations, primary care-focused provider organizations including physicians and hospitals that coordinate care. ICOs are the new ACOs, and we hope that while care is integrated, it is also accountable to its patients and public oversight.
We are particularly pleased that the report emphasizes a number of long-time HCFA priorities that complement payment reform:
- Expand chronic care models, such as the Senior Care Options program for seniors and disabled who are eligible for both MassHealth and Medicare.
- Strengthen health resource planning, by expanding DPH’s authority and staffing to review applications for new projects.
- Establish monitoring and oversight of provider advertising, such as requiring a portion of advertising spending finance public health and wellness campaigns.
- Prioritize population-based prevention of chronic disease and wellness, such as the Mass in Motion initiative against obesity.
- Expand smoking cessation benefits.
These steps recommended by the report dovetail closely with both the Governor’s proposals and the Senate President’s ideas. HCFA strongly endorses all of these recommendations, not just to reduce the cost growth strangling our system, but also to improve the quality of care, improve safety and reduce errors.
If policymakers, pundits and interested citizens were to read just one report, this may be it. We look forward to seeing the Senate proposals along the lines of these recommendations in the next few weeks, and congratulate DHCFP on their work.