Reining In Hollywood-Style Health Care

By Eric H. Schultz, president and CEO of Fallon Community Health Plan, compares health care reform in Massachusetts to the making of a Hollywood movie, and wonders why it costs so much:

In case you missed it, for the last seven weeks, the Division of Insurance, at the request of Gov. Patrick, conducted so-called health plan hearings on the topic of rising health insurance premiums for small businesses. Each week, representatives from each of the Massachusetts health plans provided detailed information on topics such as cost containment initiatives, provider contracting, customer service expenses and developing premium rates.

To be clear, we support the objective for a comprehensive and transparent discussion on this topic. And we have always supported actions that will help lower the medical cost trend, which in turn will mean lower premiums.

The problem with the discussion is that it focused on just 10 percent of the problem. That's because in Massachusetts, 90 cents of every insurance premium dollar goes to our members' medical care. Health plan costs represent just 10 percent of the equation. It would be like asking the owner of a movie theater to do something about the ridiculous cost of making a Hollywood action picture.

Nonetheless, the information the industry as a whole provided shows that we’re making that 10 cents go a long way, particularly when it comes to clinical quality and services.

That Massachusetts health plans were once again ranked higher than almost every other health plan in America by the National Committee for Quality Assurance and U.S. News and World Report is just one example.

Testimony also showed how thoughtfully we invest in initiatives, infrastructure, services and programs that improve our members’ health and provide the greatest amount of value. We talked about how we monitor, measure, refine and streamline all that we do to ensure the most cost-effective use of health insurance premiums.

The DOI has just invited the providers to come in. We hope the providers comply. Without their 90 percent of the equation, any discussion about controlling health care costs is not going to be very meaningful or productive.

And we need their input and involvement. A few years ago, key stakeholders in the health care system worked together to find a way to implement Massachusetts health care reform. And while we tackled issues that historically put us on opposite sides of the debate, we sat at the same table and forged a solution for the greater good. That’s what we need to do now. We must continue to work together – businesses, health plans, consumers, government and providers – to find solutions.

We're all trying to make a less expensive movie.

This program aired on December 29, 2009. The audio for this program is not available.


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