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Two Cheers for House Health Financing Reform Bill

Posted by John McDonough  May 5, 2012 07:55 PM

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Yesterday, Massachusetts House leaders released their first version of legislation to reform the state's health care financing system in order to bring health care costs under control. For rookie Health Financing Co-Chair Steve Walsh (D-Lynn), it is an impressive debut for his first major health proposal, advanced with the backing of House Speaker Robert DeLeo (D-Winthrop) and 11 health economists. Read the coverage in today's Globe and on WBUR's Commonhealth blog.

Two reasons this is good news.

First, the serious and public legislative process on how to achieve meaningful and long-term health care cost control is now fully engaged. State Senate leaders will release their version next week, providing similar and different proposals, and setting the boundaries for the process that will probably run until the end of the formal legislative session in late July. With leaders in both chambers releasing bills, we now have a high degree of likelihood that legislation will reach the Governor's desk in the summer. Expectations matter on Beacon Hill, and failure to produce a meaningful law now would be viewed as a major failure leading up to this fall's state legislative elections.

Second, the House leaders' proposals are potentially far-reaching and game changing. Though not as prescriptive or as regulatory as Governor Patrick's legislation released in February 2011, they are not illusory. I remember former Governor Bill Weld suggesting in his first inaugural that government should "steer and not row," and that concept comes to mind in thinking about the Walsh plan. Mechanisms to hold the health system accountable for cost would be established, as well as hard targets for how much health spending should grow.

This would be different from what happened the last time health cost growth moderated in the 1990s, and then re-ignited in the early years of the last decade. Because of the state's 1991 deregulation law, when spending began to soar, there were no accountability mechanisms to grasp, and state leaders failed to act.

Walsh's prescription is no guarantee, but would set in place mechanisms to ensure a public response to a new cost explosion, though we would still need political will to enforce the proposed limits. We will soon see what the Senate has in mind, but this may be close to as far as we can get in the current climate. Already, the Massachusetts Medical Society and the Massachusetts Hospital Association are pushing back against the recommended spending targets. A lot of discussion and politicking will happen between now the end of July.

Much of the cost control relies on a bet that so-called "accountable care organizations" will change the landscape of medical care delivery and produce tangible savings. I sure hope so. Still, we should recognize ACOs are unproven -- barely out of the gate as devised in the Affordable Care Act. Promising experiments often produce far less than imagined, and it's not a sure bet that this will concept will do better.

Still, it's an impressive set of proposals that move the conversation forward. House leaders have made a strong start.

Here is my reservation -- the bill pays only lip service to prevention, wellness, and public health. We know what is the real driver of health care costs in Massachusetts and the nation -- the growing burden of chronic disease, and the health behaviors that trigger it. Improving the quality and efficiency of medical care delivery can produce meaningful dividends. Nothing can produce the savings we need more than serious efforts to change health behaviors in ways that prevent and reverse chronic diseases such as heart disease and diabetes.

Section 2 of the Walsh bill throws a sop at prevention by creating a public health trust, though with no financing -- the ACA, by contrast, committed $15 billion to its Prevention and Public Heath Trust, the largest such commitment in the nation's history. The employer wellness tax credits in the House bill won't move any needles. Even the modest proposal from the Boston Foundation to end the state's food tax exemption for sugar-sweetened beverages and candy -- which has broad public support -- got ignored.

Maybe House leaders decided they would let members add prevention and public health in floor amendments. I sure hope so. It would make a solid and promising bill much stronger and better able to address all the compelling causes of our health spending challenge.

This blog is not written or edited by or the Boston Globe.
The author is solely responsible for the content.

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About the author

John E. McDonough is a professor of practice at the Harvard School of Public Health. He is the author of the book “Inside National Health Reform”, published in 2011 by More »


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