Senate Passes Health Care Cost Control Bill
In a step that lawmakers said would put Massachusetts on the leading edge of health care cost control, the Senate on Thursday night passed a bill estimated to trim $150 billion over 15 years from medical care costs by setting a growth target and encouraging providers and insurers to adopt alternative payment and care delivery models.
"Once again we lead the nation," Senate President Therese Murray said after the vote.
The Senate voted 35-2 to approve the complex piece of Legislation that Gov. Deval Patrick, Murray and House Speaker Robert DeLeo have all identified as a top priority for the Legislature this session. Senate Minority Leader Bruce Tarr and Sen. Robert Hedlund (R-Weymouth) were the only two senators to vote against the legislation.
The bill now moves to the House where leaders have already detailed their own version of a bill that differs from the Senate in several key areas, including the House's proposal for a luxury tax on high-cost hospitals whose price variations from lower-cost community hospitals cannot be justified.
Asked if she would entertain the luxury tax in eventual negotiations with the House, Murray said, "No."
Health care spending in Massachusetts, which already consumes roughly 40 percent of the state budget, has been projected to double from 2009 to 2020 putting a strain on not just government, but individuals and businesses that are looking to hire again after the recession.
The bill, which was debated over two days in the Senate and required the consideration of 265 amendments, would seek to limit health care cost growth to a level at or slightly above overall state economic growth.
It aims to achieve that goal by encouraging hospitals and doctors to adopt new care delivery and payment models focused on patient outcomes rather than quantity of care provided, and would transition state-funded health care programs away from fee-for-service to alternative payment systems by 2014.
The Senate has also proposed to invest $100 million over the next five years in a transition to electronic medical records, and another $100 million in wellness and prevention programs paid for with an assessment on insurers.
"This will bring the cost of health care down in the long-term, it will provide better access and better quality of care for them and outcomes of that care and they will still be able to choose their own doctors and their plans and be able to be transparent and go online and see what's available, where its offered, how much it costs and what is it going to mean out of their pocket," Murray said.
Tarr, a Gloucester Republican, raised concerns throughout the debate on Thursday about the layers of bureaucracy the bill would add to state government, a point refuted by Democrats who said the bill simply reorganizes existing agencies to provide oversight.
Before the final vote, Tarr said he appreciated the level of "caution and concern" with which his colleagues approached the issue of reforming the health care system, but said he still had concerns about cost, bureaucracy and the uncertain promise of "very, very substantial" savings in future.
Though Tarr ultimately voted against the final bill, he said members of the Republican minority – numbering four – would vote their "conscience" and opposition should not be construed as a lack of respect for the work Democratic leadership put into the bill.
Sen. Richard Moore, one of the architects of the Senate bill, said he was confident the bill would lower costs without jeopardizing the quality of care or the economy. The Uxbridge Democrat said he hoped "the bulk" of the bill would become law after it moves through the House.
During debate on Thursday, Senate Democrats voted to preserve a proposed $40 million annual surcharge on insurers over the next five years, saying those revenues would help pay for electronic medical records and prevention efforts that would lead to long-term health care industry savings. A Republican amendment to strike the surcharge attracted only 5 votes of support, with 31 senators voting against the amendment that proposed using $4 million in anticipated casino revenues to pay for e-records and prevention efforts.
Sen. Michael Moore, D-Millbury, also filed an amendment to change the inequitable "fair share" fine assessment placed on small businesses that already meet the minimum health insurance enrollment for their employees.
"While I understand that we must meet our fiscal obligations to ensure health care coverage for all, it must not be on the backs of small businesses that are already compliant with the law. These businesses are the lifeblood of job growth in the commonwealth, and we must challenge and modify any misplaced penalty that could hinder further economic development," he said.
Employers that do not offer insurance to their employees are required to make a fair share contribution toward the cost of caring for the uninsured. The law requires a company with more than 11, but fewer than 50, full-time equivalents (FTE) to offer health insurance to its employees and have at least 25 percent of those employees participate in the company health plan or offer to cover at least 33 percent of the cost of an individual plan, regardless of how many employees take it.
Employers with more than 50 FTEs must meet both prongs of the test, with some exceptions. The requirement that 25 percent of employees accept a company's insurance coverage has been a source of frustration for some employers, Moore said, because the rule makes no provision for workers already covered by a spouse's plan, a parent's plan, a veteran's plan, Medicare, Medicaid, or a plan due to a disability or retirement. Moore's amendment excludes the covered workers from the take-up calculation.
Jacquelyn Gutc of the WBJ staff contributed to this report.
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