Massachusetts passes first-in-nation bill to cap health spending

Massachusetts lawmakers have passed first-of-its-kind legislation to limit ever-increasing healthcare costs by aiming to save the state $200 billion during the next 15 years.

Cost-controlling measures within the bill include charging insurers a tax, expected to total $60 million over the next four years, that would be earmarked for a public trust fund covering preventive care and encouraging the creation of accountable care organizations, the New York Times reported.

Insurers, however, aren't in favor of the new tax, which they say ultimately will increase healthcare costs, reported The Boston Globe. "While we support the concept of a public trust fund, we have long felt that this is something that should have been funded by the state, not through an assessment on insurers and employers," Massachusetts Association of Health Plans spokesman Eric Linzer. "Ultimately, these types of assessments increase the cost of healthcare."

The legislation also pushes insurers away from the traditional fee-for-service payment method by incentivizing insurers to help providers deliver high-quality, coordinated and efficient healthcare. And to address some providers' excess market power, the bill authorizes a state panel to review and determine whether a provider is conducting unfair market practices or anti-competitive measures, WBUR reported.

"The focus of this legislation is not one that is a heavy-handed regulatory approach, but one where state government leads by example and partners with the private sector to continue healthcare reform," said Sen. Richard Moore, chairman of the Joint Committee on Health Care Financing.

Gov. Deval Patrick (D-Mass.) is expected to sign the bill.  

To learn more:
- read the Massachusetts bill
- check out the New York Times article
- see the WBUR article
- read the Boston Globe article