Mass. Global Spending Targets Beginning to Hit Home
In 2012 the Commonwealth of Massachusetts set overall spending caps for insurers and providers. These global spending caps may be working. https://www.bostonglobe.com/business/2016/09/07/health-care-spending-mass-again-exceeds-target/7HvYRD1RGxeJAe3nFTsIEL/story.html
The most recent report from the state’s Health Policy Commission found that health spending in 2015 grew at an annual rate of 3.9%, a figure below the national average of 4.6%. This is a decline from a growth rate of 4.2% the prior year, but well above the overall inflation rate of 0.6%.
The cap is accompanied by transparency, public scrutiny, corrective action plans and fines for health systems that exceed the cap. Like California, health plans are plagued by astronomical increases in drug pricing. Unlike California, all the largest health plans in Massachusetts kept their premiums under the cap.
The recent premium increases in some large Covered California plans may set the table for legislative consideration of global spending caps.
Prepared by: Lucien Wulsin