August 13th, 2012
Editor’s note: For more on the new Massachusetts law designed to curb health care cost increases, see Nancy Turnbull’s post.
How does Massachusetts health care reform and recently-passed cost containment legislation look from the perspective of an academic integrated delivery system like Partners Healthcare? I’d summarize as follows:
- There is plenty of uncertainty over how the new cost reform legislation will take shape.
- No matter how you slice it, this will be an incredible challenge for our health care system and all the stakeholders.
- Everything is moving very quickly with little or no time to evaluate any potential consequences.
- We’re changing the ways in which we are wired for “population health management” — and it’s harder than one might think.
- And we’re proud — proud that our State is truly committed to health care coverage for virtually all its citizens, and is trying to make it work.
First, a few remarks about how Massachusetts health care reform is going. These may sound a little smug, but in a year when the Red Sox may not break .500, we need some reasons to feel good about ourselves.) There are still a few people in Massachusetts without health care insurance, but only a few. My colleagues like that — it’s hard taking care of uninsured patients, and I don’t know anyone who wants to turn back the clock.
We took a lot of grief in Massachusetts for putting off tough conversations about costs until after we had broadened coverage. Our argument was that when you reduce costs in healthcare, you are reducing someone’s revenue — and that person is going to resist your plan. Our logic was that we needed to be fully committed to covering everyone before we could take on the agonizing work of managing health care costs; it would be all-to-easy to address financial issues the lazy way — by shifting costs onto patients, or not providing insurance at all.
So, in 2006, we moved ahead with our commitment to broad coverage. And the fact is that the chickens have been coming home to roost ever since.
We’ve Been Changing
Massachusetts gets a bad rap for having high health care costs, but the fact is that we’re relatively efficient compared to the rest of the U.S. for a long time now, and our efforts to become even more efficient moved to a new level well before the recent legislation passed this summer. Look carefully at the Dartmouth Atlas, and you will see that the numbers/1000 Medicare beneficiaries of operations, angioplasties, and many other measures of resource use are lower in Boston than the rest of the country – and lower than some regions with a reputation for low costs.
The reason that our health care costs are relatively high is that our real estate costs are high. Thus we have to pay people more than the rest of the country just so they can pay their rent/mortgage, and 60-70 percent of health care costs are personnel. So Massachusetts health care costs are higher than the rest of the country, but so are average salaries in almost all sectors. When the Commonwealth Fund looked at what percentage of median family income is needed for family health insurance, Massachusetts was number 48 in the country.
Nevertheless, Massachusetts provider arguments that we were not profligate in resource use were not going to help make coverage for all work. Two types of pressure have been ratcheted up on providers like us over the last decade:
- Pressure to reduce utilization. Virtually all providers are now in contracts for our HMO populations in which we are at risk for total health care spending (basically, capitation).
- Pressure to reduce price. Public reporting of quality and price by provider is as advanced in Massachusetts as any region of the country. New insurance products give patients incentives to seek care from providers with lower prices, and those new contracts give referring physicians a strong incentive to steer referrals to lower priced places, too.
It’s an interesting moment in history when our idealistic aspirations and our pragmatic imperatives have converged. We’ve always been interested in taking superb care of those 5 percent of patients who are 50 percent of costs, but now investing in high risk case managers for them is essential. Steve Shortell is right: When 30 percent of your business is in a non-fee-for-service model, your structure starts to change. And we are past that 30 percent mark at Partners as are most other provider groups in the region.
Health care cost trends are low in Massachusetts – premium increases are in the 1-2 percent range for most employers. Some of the decrease is the recession, and some reflects tough rate negotiations between payers and providers. But economists who are watching our patterns think something else is going on beyond those trends. We are actually changing the culture of medicine in Massachusetts to one in which we try to improve outcomes and costs.
I can tell you that it is a lot easier to talk about redesigning health care than to actually get it done. In our organization, we have thousands of clinicians who work as hard as one can work, and we have more than a million patients who come to us each year worried and sick. Adding new complexity to their lives is not always well received.
That said, we and other providers in Massachusetts have a pretty good idea of what we have to do. At the top of the list, we are putting in place high risk patient case management programs in which the case managers are actually embedded in our physicians’ practices. We have had very encouraging experience with this approach in a Medicare demonstration project that began at the Massachusetts General Hospital and now has spread across our system. As we do that, we are moving our primary care practices to being Patient Centered Medical Homes and to meet all the information technology Meaningful Use requirements that come from the U.S. government — and more. We’re moving to a new information system that will enhance our ability to follow individual patients and patient populations across time.
We have a Powerpoint slide with 20 key tactics developed by my colleague, Tim Ferris, MD, and it has been discussed so often in the last year that we don’t even need to show it in our meetings anymore– we just refer to “The Twenty Tactics slide.” We often feel overwhelmed by all the things we have to do. But the fact is that there are 20 tactics on the slide, not 200. And we are in it for the long haul.
So What Happened This Summer?
On one hand, the 349-page law that was just passed in Massachusetts created 25 new boards, task forces, and commissions, and 266 new appointees are going to be enlisted to monitor and enforce compliance with spending caps, oversee provider performance improvement plans, and certify Accountable Care Organizations (ACOs). The Massachusetts Attorney General, Martha Coakley, told the Commonwealth that she believes that the statute provides enough enforcement tools “to allow us to help oversee the market.”
Not all those boards and tasks forces are going to prove valuable over time, but the cumulative effect of the process leading up to the legislation and the legislation itself is a reaffirmation of the State’s commitment to do whatever it takes to make coverage for all work. Whatever spats we may have among us in Massachusetts, we all do share that goal. That said, there are going to plenty of challenges ahead as we implement the new law.
I’ll close with a real-life vignette from the best day of the summer, June 28, when the Supreme Court allowed most of the Accountable Care Act to remain intact. I was seeing patients that morning; my medical assistant and I were both checking the web constantly, awaiting the outcome. Shortly after we received the good news, one of my patients arrived, a 70 year old retired businessman who was a half hour late. He was perspiring from rushing to get there, and his blood pressure was 155/90.
“I know why my blood pressure is high,” he said. “I was so worried about what the Supreme Court was going to do. I really was. If they had voted the legislation down, it would have been a terrible thing for the country.”
I told him that I agreed, and that I, too, was relieved. But then I pointed out that he had gained three pounds since our last visit, and that might also have something to do with his increase in blood pressure. And I told him about our web-based Patient Portal that might help him and me work together better to control his blood pressure and watch his weight.
Increasing use of our Patient Portal is one of our 20 tactics. I just checked – he hasn’t enrolled yet. I am going to bug him to do so.Email This Post Print This Post
Don't miss the insightful policy recommendations and thought-provoking research findings published in Health Affairs. I want to SUBSCRIBE NOW!