Cost Control Unwise, Docs Say

Mario Motta, M.D., President, Massachusetts Medical Society, suggests that payment reform, evidence-based health insurance, early disclosure of medical errors coupled with non-judicial resolutions, and other measures will be more effective in reigning in health care spending than a plan backed by the current administration:

Governor Patrick’s small business legislation is a well-intentioned attempt to encourage business growth in the Commonwealth and provide relief for small businesses from rising health care costs. But one of his prescriptions for relief, cost control, is not a wise course of action.

We recognize how the recession has battered small business. Rising health insurance premiums are a significant part of this. But we believe that simply regulating rates would trigger a wide range of unintended consequences and would not solve the underlying problem.

A better approach for cost containment comes from the Massachusetts Health Care Quality and Cost Council. Its final recommendations would allow the state to meet its goal of containing cost growth in health care because it employs a comprehensive approach to a very complex problem.

The Council’s recommendations include comprehensive payment reform, support of system-wide redesign efforts, widespread adoption and use of health information technology, implementation of evidenced-based health insurance coverage informed by comparative effectiveness research, development of health resource planning capabilities, enactment of malpractice reforms and peer review statutes, implementation of administrative simplification measures, consumer engagement efforts, emphasis on the prevention of illness and the promotion of good health, and increased transparency.

We’re much less than enthusiastic about its support for limited provider networks, because the current science of determining provider value and efficiency is rife with error and results in more harm than good.

The Council studied rate regulation as well and decided it should be considered only as a last resort. Its own subcommittee studied the effect of rate freezes on insurers and providers – the most extreme version of rate control – and concluded it would be disastrous. The Legislature, which created the Council in 2006, should pay serious attention to this conclusion.

A final word about the utilization of health care services, which is high on everyone’s list.

We’re convinced that the practice of defensive medicine is an important factor in rising utilization and costs. National studies have estimated that defensive medicine costs the country billions of dollars. In Massachusetts alone, our own study of defensive medicine conservatively estimated its cost at nearly $1.4 billion. That’s equal to about 5 percent of total health expenditures in our state. We believe the actual cost could easily be double that.

To begin curbing this phenomenon, we support state legislation that would encourage the early disclosure of medical errors and appropriate apology and provide the fair and prompt non-judicial resolution of claims for damages resulting from those errors.

Everyone agrees controlling costs in health care is critical and that the status quo is not sustainable. But blunt-knife approaches to this problem have failed before and will likely fail again, until its complex causes are addressed with an equally sophisticated solution.