Payment Reform Commission Finds Some Heat

This is not a summary of the 4+ hour long meeting of the Special Commission on Payment Reform on Friday. Health Care for All has some of that here. I'm focusing on a couple of issues or questions that are beginning to make these all too congenial meetings more interesting.

There is a tension developing about what can be done NOW to reign in health care spending, what is the longer term plan, and whether those two stages might be at odds.

Board members who represent state government are urging the commission to take immediate cost control steps. A and F Secretary Leslie Kirwan and Group Insurance Commission director Dolores Mitchell spoke several times on Friday about the need for bold action that will hold down health care spending and relieve some pressure on the state budget (about half of which is spent on health care). Ms. Mitchell’s budget at the Group Insurance Commission is $60-million short this year.

Harvard School of Public Health professor Nancy Kane suggested the state redistribute money more equitably among providers or look at freezing the rates it pays to both save money and push providers to try something new (global payments are the preferred option, but there is no decision yet on what the commission will recommend).

But Lynn Nicholas, president of the Massachusetts Hospital Association, says an immediate dramatic change in state funding would blow up support for longer term change among hospitals. She suggests using federal stimulus money to create incentives and tools that would help hospitals adapt to a new payment system. And some commission members say fixing the state’s current budget problems is not the group’s mission.

There second lingering question is related. Physician groups have told commission consultants that any move towards global payments must be slow and deliberate. It’s clear that the state can’t set up a system where doctors will be more accountable for spending on each patient unless the physician buys into the idea. This was all too obvious in the mid 1990s. So if the commission picks an option that shifts more accountability for patient spending and outcomes to doctors and hospitals, how does the state persuade doctors and hospitals to take this on (and quickly)? Dr. Alice Coombs, a commission member suggests having doctors who work with a similar system now help answer questions from skeptics.

The commission decided early and easily that the current system where providers are paid for doing more does nothing to control spending or make sure patients get the right and best care. It seems to have decided that moving towards spending limits tied to giving patients what they need is the right change. But as several members said, the transition will be very tricky. That's especially true given high expectations that the commission will find ways to begin saving money on health care ASAP.

Martha Bebinger