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With Health Costs The Next Target, Mass. Businesses Seek Solutions02:08
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Health care providers and business leaders in Massachusetts are generally positive about a new plan by Senate President Therese Murray to drive down health care costs, and some of them are calling the effort part two of Massachusetts health reform.

Murray unveiled her proposal in front of a crowd of hundreds at a breakfast hosted by the Greater Boston Chamber of Commerce. It's actually a series of ideas meant to put an end to the double-digit jumps in health insurance premiums that are burdening small businesses, and ultimately to make health care less expensive for everyone in the state.

As Brian Rosman of the Boston non-profit Health Care for All see its, that's exactly where the reform debate goes next.

"The first stage was trying to get everybody covered," Rosman said. "Stage two is very much working on the cost of care and improving the quality of care, and those go hand in hand."

Costs Are At The Heart Of The Debate

The cost of health care is at the heart of the ongoing legal fight between insurers and state regulators over premiums.

But Rosman says until the state reins in health care expenses, premiums will continue to climb. And he and many other people who make their living trying to improve the system believe the only way to reduce costs is to change the entire way care is delivered and paid for.

"So that providers are reimbursed for quality, for value, for keeping us healthy and well," he explained, "rather than, as they are now, they make more money the sicker we are."

That's because under the current system, most doctors get paid for every test and procedure they do. And that's why Murray wants to end the so-called fee-for-service system. She says global payments are one alternative. Those give doctors a fixed amount to spend on their patients for a full year.

Rosman likes the idea, as long as it's done correctly.

"Global payments could be done in a horribly wrong way that leads to poor care or less care," he acknowledged. "But we think if it's done in the right way, people will have more primary care, more emphasis on keeping you well and healthy."

Blending Regulation And Competition To Control Costs

Besides ditching the usual method of paying doctors, Murray also proposes blending government regulation and new competition to lower insurance premiums.

Jon Hurst thinks that's a good start. He's president of the Retailers Association of Massachusetts, which says small employers should be able to negotiate insurance rates and buy group policies, just like big employers do.

"Put everybody into one market, and then ultimately that would be fairest thing, right?" he said. "But I think a lot of the larger purchasers would not like that."

Murray is also asking health care providers to donate money to help reduce small business insurance costs. Partners HealthCare, which runs Mass. General and Brigham & Women's, among other hospitals, has already said it will kick in $40 million.

In her keynote speech at Wednesday's breakfast, Murray made it clear she won't turn down any other offers.

"If there are any other large providers here that would like to give me some money, I'd be more than willing to take it ," she said, drawing laughs from the crowd.

Murray didn't detail how those donations would be used. But she conceded they're not a long-term fix. Jim Roosevelt, the president and CEO of Tufts Health Plan, agrees.

"A voluntary contribution program to provide rate relief is a wonderful thing in the short term, and we're in a short-term economic crisis, we all hope," Roosevelt said. "So it's a great thing (but) it's not even a medium-term solution."

No Single Solution To The Problem

Still, Partners HealthCare chief operating officer Tom Glynn likes that Murray's plan has short- and long-term goals. He says she recognizes there's no one answer to fixing the system's flaws.

"She is saying, 'Let's take one step at a time, let's do it in a thoughtful way, let's be open to recognizing that we're going to have to change along the way,' " he said.

And Murray is urging everyone with a stake in reducing health care costs — which is basically everyone — to work together, just like they did to pass the state's landmark health reform law in 2006. If that happens, Glynn says, Massachusetts could lead the way in finally controlling health care costs — for the state and for the rest of the country.

This program aired on April 15, 2010.

Sacha Pfeiffer Twitter Host, All Things Considered
Sacha Pfeiffer was formerly the host of WBUR's All Things Considered.

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