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Thoughts on Controlling Health Care Costs by John McDonough

If Massachusetts is serious about controlling rising health care costs, we've got to start acting that way. So far, we're not. Some thoughts on our current predicament:

1. MA health reform critics complain Chapter 58 doesn't control costs. They're right. There was broad agreement on a path to expand access, not on a path to control costs. Some suggest we should not expand access until we agree on how to control costs. We only hear that complaint from folks with insurance. We disagree that the uninsured (155,000+ covered now) should have to wait for that consensus before we expand coverage.

2. Some talk about the cost crisis as though it only relates to health reform. Not so. Rising costs affect every element of society - not just those helped by health reform. David Williams at the Health Business Blog reports his business' health premiums will rise 26.3% next year. Whether it's a state, municipal, business, or family budget, the cost crisis affects you. Health reform is an asterisk in the bigger health cost picture.

3. One part of Chapter 58 seeks to address rising costs - the Quality and Cost Council, a 13 member body formed "to establish health care quality improvement and cost containment goals." On June 20, the council approved its first set of annual quality and cost goals. Health Care for All published them on our blog. To our knowledge, these goals have received virtually no public discussion or comment.

The Q&C Council is composed of dedicated, smart individuals committed to using the Council as effectively as possible. Still, we worry the Patrick Administration and legislative leaders think they've done their job by "tasking" the cost challenge to a Council with no real power, limited resources, and sparse visibility. We fear the challenge of confronting rising costs is beyond the Council's capacity to handle on its own. They can play an important role. But a challenge this size - how about a brass knuckle Cost Control Summit hosted by the Governor, Senate Pres, and House Speaker? That'll get noticed.

4. Check out, if you will, the Council's year one goals. The first one deals with costs and it's a doozy: "Reduce the annual rise in health care costs to no more than the unadjusted growth in Gross Domestic Product (GDP) by 2012." The rest apply to quality - such as reducing hospital acquired infections etc. The set of goals embraces a popular hypothesis in health policy - that if we just get quality right, given the documented amount of clinical waste in our system, that's the magic pill to cure our cost disease. Wouldn't it be luverly?

What if this hypothesis is wrong? What if we do everything quality-wise and costs still rise at destructive, unsustainable rates? Are we willing to consider "R" word - regulation? We deregulated our cost-control system in 1991 believing that market forces and competition would do a better job. It did for about five years, and now we've had close to a decade of budget-busting premium hikes. Are we ready to acknowledge the failure of the 1991 deregulation strategy? Do we have to wait until 2012 to see if the new strategy will work? We don't think we can afford to wait til then.

5. Massachusetts needs a comprehensive, high-level, coordinated, multi-year cost control strategy. Not for auto insurance, for health insurance.

PS: In March, Health Care For All published 17 ideas we think could be part of this strategy. Click here to view the report. We filed it as legislation that will be heard by the Health Care Financing Committee in October. Also, click here for a new Commonwealth Mag article on rising health costs.

John E McDonough - mcdonough@hcfama.org - is executive director of Health Care For All.

This program aired on July 26, 2007. The audio for this program is not available.

Martha Bebinger Twitter Reporter
Martha Bebinger covers health care and other general assignments for WBUR.

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