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Health insurers, businesses seek to limit costs in Mass.

Group aims to ease pressure on employers

Email|Print|Single Page| Text size + By Jeffrey Krasner
Globe Staff / June 5, 2008

Massachusetts businesses yesterday joined with most of the state's health insurers in a new lobbying group aimed at controlling healthcare costs and preventing more universal-coverage expenses from being shifted to employers.

The Coalition for Affordable Health Care said it will fight efforts to increase assessments on employers who do not provide health coverage for workers. It will also oppose raising the standards for what constitutes a "reasonable" contribution under the state's healthcare overhaul law, a groundbreaking effort to extend health coverage to all Massachusetts residents.

At a meeting at the Omni Parker House hotel in Boston, discussion centered on ways to control healthcare spending. Premiums for most commercial insurance plans have risen at least 10 percent each of the past seven years, making Massachusetts' per capita spending among the highest of any state.

Charles Baker, chief executive of Harvard Pilgrim Health Care, the state's second-largest health plan, said many Americans wrongly equate higher spending with better care.

"The notion that the more you spend the better you are in healthcare is a giant urban myth," he said.

Baker supports so-called consumer-driven healthcare, in which patients pay higher deductibles and copayments as an incentive for them not to go to the doctor too often or use other unnecessary medical services.

But Amy Lischko, a former state health official and an assistant professor at Tufts University, said there are limits to how people will respond to typical consumer-driven plans. Such coverage might make it more expensive to see a doctor who gets a low ranking for cost and quality.

"Consumers really don't act like rational economists do," said Lischko. "They're not going to change the doctor they've been seeing for 10 years because a visit is going to cost $5 more." She argued for more creative ways to convince people that extra procedures and expensive diagnostics don't necessarily make them healthier.

Yesterday's meeting - the group's first - mixed healthcare economics with recruitment efforts.

Thomas Tubman, executive vice president for Carlin Combustion Technology Inc. of East Longmeadow, said he has a hard time recruiting and retaining employees because the company's health benefits are frequently reduced to save money.

"My employees won't accept any additional cuts in healthcare benefits," he said, in asking other businesses to join the group.

Healthcare advocates, such as the Greater Boston Interfaith Organization, last week said they would try to get businesses to contribute more to employees' healthcare. Eileen McAnneny, vice president of Associated Industries of Massachusetts, the state's largest business lobby and a cofounder of the coalition, said the group is fighting those efforts.

In particular, she said, the coalition wants to prevent the state from raising the level of employer contribution required to avoid a $295-per-employee annual assessment. She also wants to keep the state from enacting additional healthcare mandates - areas of coverage that companies must offer as part of a healthcare package.

Jeffrey Krasner can be reached at krasner@globe.com.

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