Report: Mass. among highest in health costs, price disparities

A report based on data from Massachusetts Attorney General Maura Healey and others shows that price variation and cost of health care in Massachusetts leads most other U.S. states.

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By Emily Micucci

Massachusetts leads the nation in health care costs and price variation among providers, according to a report released on Tuesday.

The report, which conducted by Freedman HealthCare and sponsored by local business advocacy groups including the Associated Industries of Massachusetts and the Massachusetts Association of Health Plans, suggests that market-based efforts to control costs have failed to make health care more affordable in Massachusetts, and that short-term regulatory interventions may be needed. The report is based on various state and federal data on health care market trends.

According to the Freedman report, provider price variation, which refers to the difference in price providers command for the same healthcare services, is worse in Massachusetts than in “nearly all other markets,” with the state’s highest priced hospitals consistently being 2.5 to 3.4 times more expensive than lowest-priced hospitals between 2010 and 2014.

Meanwhile, the report found that employers and their employees are struggling to meet the cost of health insurance, as health care costs as a percentage of income continue to grow, and companies battle higher than average insurance premiums.

Options highlighted for addressing price variations included capping payments at a percentage of Medicare payment rates and considering longer-term market regulation such as rate setting, among other options.