Massachusetts Releases Payment Reform Legislation: Worth the Wait?

This blog was updated to reflect corrections to the details listed in the House bill.

Nearly 15 months ago, Massachusetts Governor Deval Patrick filed legislation to address the sky rocketing health care costs in the state by shifting away from the state’s largely fee-for-service way of paying for health care services. After initial hearings on this issue last summer, the state legislature remained quiet; until last week, when the House and Senate finally unveiled their versions of the legislation. The legislation addresses many of the elements that advocates, including the Massachusetts Campaign for Better Care (CBC), fought for this past year.

Highlights of the House bill (for more details see this article):

• • Creates a new oversight agency, the Division of Health Care Cost and Quality, which will be run by a governing board with consumer representation (one out of nine members)
• • Requires consumer representation (at least one patient) on Accountable Care Organization (ACO) boards
• • Establishes a Wellness and Prevention Trust Fund aimed at promoting wellness at the community level in partnership with clinical providers within certain geographic areas
• • Creates protections that ensure consumers receive needed services and imposes penalties for inappropriate denials of services or treatment
• • Encourages any alternative payment methodology to include a risk adjustment based on health status i.e. functional status, socioeconomic, or cultural factors.

Highlights of the Senate bill (for more details see this article) :

• • Creates and funds a Wellness and Prevention Trust Fund through a surcharge on health plans
• • Improves care coordination and access to preventative services
• • Requires the Department of Public Health to develop model checklists of care that may be used by hospitals to prevent medical errors and infections.
• • Requires ACOs to promote patient-centered care by involving patients in shared decision making, in planning their care transitions across settings of care (e.g. moving from the hospital to a rehabilitation center) and establishing ways to evaluate patient satisfaction with access to and quality of care.
• • Requires ACOs to include patient and consumer representation on governing boards

While both versions of the bill are strong and take a comprehensive approach to transforming the state’s payment and delivery systems, there are still areas that need strengthening, most notably: the financing mechanism for the Wellness and Prevention Trust Fund; meaningful compliance with the Americans with Disabilities Act (ADA); shared savings, especially in the Senate version of the bill; and payment policies to discourage potentially preventable errors.

The Massachusetts CBC is working with Senators to amend the legislation. The bill’s passage and implementation over the next several years will not only mark a big change for consumers in how they receive care but also put Massachusetts in the vanguard of states tackling health care costs. So for a bill that took more than a year to be released (and that will probably pass in a matter of weeks), it’s a strong start, and yes, it was worth the wait.

-- Leena Sharma, State Advocacy Manager, Integrated Care Advocacy Project