MA plans big changes to provider pay

A group of Massachusetts officials are planning an extraordinary healthcare experiment--one arguably as radical as the forced downsizing of New York's health care system [1].

A state commission is urging Governor Deval Patrick and the state Legislature to take no less bold an action than to completely restructure the way health plans pay providers. Rather than pay providers and hospitals discounted fees for procedures and visits, health plans would be required to pay them a single flat fee that covers all of that patient's care for a whole year.

Commission members, who are tasked with slowing the state's 8 percent annual growth rate in health spending, say such a system would force doctors and hospitals to work together more closely, while trimming the use of needless tests and treatments. Critics, meanwhile, note that the approach faces some extraordinary challenges, including how doctors and hospitals would divide these payments. 

Clearly, this approach is a feint at models like value-based purchasing, such as Geisinger Health System's flat-fee surgery package [2]. The thing is, it tries to bring a lot of parties into the game--institutions with competing interests--that aren't likely to ever cooperate on the level a single institution can. Unless there's some secret sauce here that the commission hasn't disclosed, I smell trouble.

To learn more about Massachusetts' grand plans:
- read this piece [3] from The Boston Globe

Related Articles:
Doctors, researchers slam MA reforms as national model [4]
MA health reformers slash insurance rates [5]