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'No Stick Needed:' Counter-Proposal For Mass. Health Reform

Massachusetts Governor Deval Patrick
Massachusetts Governor Deval Patrick

From the moment last February when Gov. Deval Patrick declared his determined push for a new wave of Massachusetts health reform aimed at controlling costs, it was clear that the state's major health care players would not just passively accept his plan. They formed a coalition to craft an alternative. They began meeting. And now the draft of their counter-proposal is out, as reported here — replete with slide deck — by WBUR's Martha Bebinger.

It's a plan of many parts, but what strikes me most is that the health care industry is saying that it should be allowed to pursue new models of organizing and paying for health care without fear of state regulation or penalties, at least for the next three years.

Not to trivialize, but here's what comes to my mind on an emotional level: A teenager whose parents tell him that he can't go out unless he finishes his homework, and he replies, "I'm doing it, I'm doing it! You don't need to threaten me!"

Here are slightly distilled excerpts from Martha's chat yesterday with Sacha Pfeiffer of WBUR's All Things Considered, and for more on the draft plan, the Globe's Liz Kowalczyk reports here.

Sacha: A coalition that includes health care industry leaders in greater Boston and health economists has put together its draft plan for how to get health care costs under control. The message to Gov. Patrick and the legislature is that 'We can reduce spending without more government regulation.' The coalition suggests that more regulation might make things worse than they are now. Martha, what does this coalition say it can do on its own, without any government involvement — or maybe what the coalition means is, without any government interference?

Martha: I think that is the message, Sacha. They say they can set goals for spending increases. So right now, we think spending increases are rising at about 7-8 percent a year for health care, and the state's GDP is down there around 3 or 4 percent. They want to get us down to that GDP level, so to cut it almost in half.

What that means in real terms is that by 2020, they would be saving around $8 billion or 10% of what the state expects to spend on health care that year. It’s a lot of money but they say it’s a realistic goal that would not disrupt the state’s economy...Is it enough money, is one question. The other major question is: Will this coalition hold together?

Sacha: This is a modified version of what Gov. Patrick has already proposed — How is this different? And how is the coalition selling it to the Patrick administration?

Martha: It’s different in that it moves a little slower than what the governor and what some legislators have talked about. It does not include any penalties for not reaching targets for the first three years. It establishes an outside body — outside state government — so it’s a lot of health care experts that would actually be helping this plan roll out. It wouldn’t be state government bureaucrats or leaders that would be doing that.

Stuart Altman, who’s the health policy expert at Brandeis University, is chairing this group. They are selling this by saying it’s very strong but prudent.

Stuart Altman: "Because it allows the system to change in an orderly way. We do have to be concerned about the quality of the care and the access to care. We really do have a very good health care system in the commonwealth..."

Martha: Some hospitals are telling the administration and legislative leaders that if you move too fast with too many rules, you’re going to see major disruptions. Job losses. It’s a threatening picture.

Sacha: In some ways, this is the health care industry asking to write the plan for its own future — do you think that the Patrick administration and the legislature will agree with that vision of the health care industry’s future?

Martha: Well, the group has briefed the administration and the word that I have, although not directly from the administration, is that they’re open to considering it. They are worried about what would happen if they have to force the industry to change rather than have the industry do things voluntarily or at least in a cooperative manner.

Sacha: What reaction are you seeing from people who have seen this draft?

Martha: I'm hearing from some groups that it doesn’t go far enough fast enough. It doesn’t close that gap between high-cost and low-cost hospitals. But on the other hand, you have some employer groups who are saying, 'This is something we might sign on to.' Here’s Rick Lord, who's the president and CEO of Associated Industries of Massachusetts:

"The business community would like to see some spending targets set to show a slowing-down and hopefully a reduction in the future of health care costs, without a lot of government intervention.”

This program aired on November 4, 2011. The audio for this program is not available.

Carey Goldberg Twitter Editor, CommonHealth
Carey Goldberg is the editor of WBUR's CommonHealth blog.

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