Senate Passes Health Care Cost Control Bill With Few Major Changes

In a near-unanimous vote — 35-2 — the Massachusetts Senate on Thursday night passed a major health care bill that legislators estimate will save $150 billion over the next 15 years.

"This bill will reel in health care costs without harming our number one industry or patient care," said Senate President Therese Murray in a statement, "and remove a major roadblock to long-term job growth and essential investments in education and transportation.”

In two days of debate, the Senate made dozens of large and small adjustments to this complex health care bill. Members set a health care cost-control goal that's more aggressive than in their original bill. The bill would allow costs to grow 0.5 percent more than the gross state product (GSP) through 2015 and then drop to level with GSP indefinitely.

The Senate bill would also create standards as more public and private insurance plans switch to global payments. Senate Democrats rejected a Republican amendment that would have gotten rid of a new surcharge to fund electronic health records and prevention programs.

"We know it’s less expensive to keep disease from starting in the first place than to treat someone after they’re sick," said Brian Rosman, policy director at Health Care for All. "And we know that community prevention lowers health care costs along with keeping people healthier."

But not everyone is celebrating passage of the bill.

"The amendments, as I watch them, many of them really do add to the cost rather than contain the cost of health care," said Bill Vernon, with the National Federation of Independent Businesses in Massachusetts.

Vernon is skeptical that the bill, with new fees, boards and commissions, will save the estimated $150 billion over 15 years.

"I have a very hard time believing that it's actually going to reduce the cost of health care for small businesses and the people who work there," Vernon said.

The Senate saved one of the more controversial items for last.

Late Thursday, as cleaning crews hauled trash and mopped the marble halls, Sen. Barry Finegold rose to argue for an amendment that would make hospitals with the highest prices justify those costs to a new independent board.

At least four recent reports from Attorney General Martha Coakley and an agency in the Patrick administration have concluded that high prices, based on top hospital market clout, are driving up health care costs.

"And the thing about it is," Finegold said, "there’s no correlation between price and the quality of care."

Finegold says that while community hospitals generally deliver the same quality of care as their big, wealthier counterparts, they are struggling to make it on much lower payments.

A special commission that met for six months last year came up with a remedy that Finegold tried to add to the Senate bill.

"Now I understand that there is not a majority will to do that," Finegold said, wrapping up his speech on the Senate floor. It was mostly for show — Sen. Finegold withdrew this controversial amendment, avoiding debate and a possibly difficult vote.

The more expensive hospitals and many of the state’s business leaders lobbied hard against a government board that would decide if high prices are justified. The House bill has a similar measure that these groups say is also unwarranted.

"At this point we don’t believe that increased government regulation is the right approach to deal with price disparities," said Associated Industries of Massachusetts President Rick Lord.

Lord says he's hopeful that consumers who are paying more of their health care costs will drive down prices by using lower cost hospitals.

"That’s the approach we believe, at least in the short term, is the appropriate course to follow," Lord said.

Lord and others now turn their attention to the House, which takes up its version of the latest Massachusetts health care overhaul at the end of the month. The two branches will appoint a conference committee to negotiate a possible compromise on their differences and will likely deliver a bill to Gov. Deval Patrick in July.