It looks like Massachusetts will miss a self-imposed health care spending target again this year. This warning from Attorney General Maura Healey comes just a few weeks after a state agency announced that Massachusetts failed to keep spending below 3.6 percent last year, as recommended in a 2012 law.
The forecast for this year is in a report produced by Healey’s office. It finds little change in problems that have been building for years: some hospitals are paid a lot more than others, patients frequent the expensive hospitals and efforts to shift the way we pay for health care aren’t closing the price gaps.
“These trends, coupled with new growth in pharmacy costs and utilization of health care services, point to a likely failure to hold health care spending increases below the 3.6 percent benchmark the Commonwealth set for 2015,” according to the latest Examination of Health Care Cost Trends and Cost Drivers from the office of the Attorney General. It’s the fifth such report and the first from Healey.
It says increases in the amount of care patients are seeking and rising pharmacy costs will eat up the allowed 3.6 percent this year. To stay below that figure, the AG says, payments to doctors and hospitals could not rise more than a .08 percent. Many providers have contracts in place that include higher rates. And there’s not much time left to fix 2015.
This year aside, AG has a number of suggested changes for 2016 and beyond. Here’s a sample:
1. Require clear cost and quality information from hospitals, doctors and insurers. The AG says consumers report difficulty finding price information and understanding health care bills.
2. Make tiered networks more uniform and boost the patients’ cost for using a high-end hospital. The AG says tiers based on ACOs, or large networks, would be easier for patients to understand and use than tiers based on individual physician ratings.
3. Check to see if individual providers are under the state spending benchmark.
4. Consider regulating prices. The AG does not say how. The rules might say rates have to stay within a range.
We’ll update this post with comments and reactions after the report is public on Friday.