A new report from the Kaiser Family Foundation confirms what we already knew: Health insurance premiums are high in Massachusetts. Along with Vermont, Massachusetts leads the nation in individual health premiums, averaging $400 per month, including employers’ contributions.
The finding is no surprise, because health care costs have been higher in Massachusetts for a long time. There are several contributing factors at work here, including a higher cost of living in general and the presence of some of the world’s top teaching hospitals, which tend to charge more even for routine procedures.
Some are quick to blame the state’s 2006 health care reform law, but we’ve seen no convincing evidence that making health insurance available to thousands of otherwise uninsured pushed up costs. The Kaiser report attributes some higher costs to requirements put on insurers by the state, including covering patients with pre-existing conditions, but some of those costs are offset by getting more people in the insurance pool.
What counts is what the 2006 law didn’t do. The authors of that law never promised to restrain health costs, and included no provisions that would keep costs down. That shortcoming has been criticized for years on this page and by political leaders, including Gov. Deval Patrick.
There’s actually been relatively good news of late on health care premiums. Thanks to market pressure from competitors, new policies with higher co-pays and deductibles, and a tougher stance by regulators in the Patrick administration, the latest round of rate hikes is lower than the state has seen in many years. State House News Service reported Thursday that the rate hike requests filed July 1 average no more than 5.9 percent for any insurer.
That’s still higher than the overall rate of inflation, of course, and 5.9 percent only looks good compared to the double-digit increases we’ve seen for years. When the underlying problem is ever-increasing health care costs, pressuring insurers can only go so far.
For over a year, Patrick has been pushing for health care payment reforms to take away some of the incentives for excessive health care spending. Legislative leaders have resisted, saying there’s not enough time to take up the complicated issue this year. Patrick hasn’t been taking “wait until next year” for an answer, nor should he.
The Kaiser report should remind all the state’s elected leaders that health care costs are a priority for Massachusetts businesses and families. The Bay State led the nation in addressing access to health insurance; now we should lead in taming health care inflation.
We understand the Joint Committee on Health Care Financing is working diligently on a comprehensive payment reform bill. We look forward to the legislature acting decisively to enact reforms that improve care and reduce costs.