Rate hike requests closely scrutinized under Massachusetts reform bill

Massachusetts Gov. Deval Patrick's comprehensive healthcare payment reform legislation increases oversight of insurers' rate increase requests while moving the state toward a "global payment" system

Patrick's bill provides standards and benchmarks for establishing accountable care organizations. It empowers the insurance commissioner to consider a wider array of factors when deciding whether to approve insurers' premium increases. And it creates an advisory council of stakeholders and consumers to monitor how payment reform is implemented, reports WBUR.

Of particular importance to insurers, Patrick's bill would strengthen the insurance commissioner's authority to review healthcare premiums and to reject excessive increases, according to the Boston Globe. The commissioner must consider a provider's rate of reimbursement with a payer as well as whether the payer and provider are transitioning from a fee-for-service contract to an alternative payment contract when reviewing rate increases. The department may disapprove rate increases inconsistent with the state's economy or the region's medical expenses, GovMonitor reports.

Patrick's proposal also would set a more formal structure for health insurers to reward a primary care doctor for treating a patient's overall health, including the creation of a new healthcare council made up of top public health officials to act as a central clearinghouse for the system. Although the council won't have the power to directly set a price for how much a hospital or doctor can charge for an operation or test, it will try to set boundaries for the market.

The state's insurers have recommended a cautious approach, saying that before pushing a global payment system that mandates more coordination among a patient's physicians, nurses, hospitals and other care providers, Massachusetts should even out how much hospitals and doctors can charge. In the same healthcare market, costs for similar tests and procedures can vary wildly, insurers said, and the state needs to create a more level playing field, notes the Globe.

To learn more:
- read the Boston Globe article
- see the GovMonitor story
- check out the WBUR piece

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