Entries by Joshua Archambault

Moody’s Report: New Mass Price Capping Law “Credit Negative” for Hospitals

In the soon to be long list of unintended consequences as a result of the brand new price capping law signed yesterday by Governor Patrick, Moody’s released a report warning of the future impact of the law on hospitals in the Commonwealth. While not a formal downgrade, it could raise the cost of capital borrowing for these hospitals and increase the cost of providing health care going forward. These extra costs will be passed onto consumers in the form of higher care costs and insurance premiums. More from SHNS($): The health care cost control law signed by Gov. Deval Patrick Monday will hurt the bottom lines of Massachusetts hospitals and limit their flexibility to grow, a major credit rating agency warned Monday. “The […]

Funny Business Ahead in Massachusetts?

Over at the Manhattan Institute, Paul Howard recently blogged on Massachusetts’ move towards a price cap on health care growth.  The whole piece is worth reading, but he makes one great point that has not be explored enough in Massachusetts: Bay State legislators are betting that you can reform 20% of the economy from the supply side, with very little involvement from the demand side (the patients). (For more detail, see this post.) It also assumes that commissions and technocrats recruited from industry, hospitals, and academia won’t play favorites, or be pressured by interest groups into supporting pet projects and institutions. Good luck with that. Find me on twitter: @josharchambault

Will Government-Directed Healthcare in Mass. Really Contain Costs?

Governor Patrick signed a new healthcare law today aimed at cost containment, and the rhetoric soared assuring all that Massachusetts has “cracked the code on healthcare costs.” Unfortunately, with no debate on the underlying bill in the House of Representatives and only little debate in the State Senate, the 349-page statute, which was released just 14 hours before the legislative final vote, is little understood and brimming with unintended consequences. To mark the occasion, Pioneer released the follow infographic: Real cost-containment is only possible when we encourage patients to reward low-cost, high-quality providers with their business.  We’ve said it over and over again throughout this process. Instead, the law being signed today re-imagines and repackages so many failed top-down approaches […]

Pioneer’s Statement on “Cost Containment” and Payment Reform Bill

Another Lost Opportunity to Give Individuals and Businesses Relief on Health Care Costs Final Version of Conference Committee Bill Adds Hundreds of Millions to System BOSTON – After years of debate over how to contain health care costs, the Massachusetts Legislature is poised to approve a bill that burdens the entire health care system with more bureaucracy and hundreds of millions in increased expenses. “Real cost-containment is only possible when we encourage patients to reward low-cost, high-quality providers with their business,” says Josh Archambault, Pioneer’s director of health care policy. “Instead of providing financial incentives for individual patients to take charge of their own medical care, this legislation rearranges the system based on accountable care organizations (ACOs) and changes in […]

ACA Impact on Mass, Part 1: Low-income Residents will Pay More for Healthcare and Insurance

Affordability/ Subsidy levels for Low-income: How much will individuals pay for health insurance and health care under the federal law? Under the ACA, low-income individuals will pay more. Urban report I don’t recall supporters of the federal law in the Commonwealth highlighting this difference before it passed Congress or leading up to the SCOTUS ruling. Drilling down to look at cost-sharing as well along with the range of premium payment ranges: Mass vs Fed Diff in costs State Law – CommCare Federal Law – QHP Premium Cost-sharing Premium Cost-sharing 138-150% FPL $0 $29 $36-$54 $24 150-200% FPL $40 $29 $55-$114 $54 200-250% FPL $78 $43 $115-$183 $115 250-300% FPL $118 $43 $184-$259 $128 Source: Connector The State may have two […]

How SCOTUS ACA/Obamacare Ruling Impacts Mass

Most of the press coverage has focused on the political angle of the SCOTUS ruling, but the more interesting and complex questions lay at the policy level. Pioneer recently released a book to propose a new relationship between states and the federal government, and it has received considerable national attention. Even if Democrats or Republicans don’t talk about the law this way, the new healthcare law is a new entitlement program and will likely be reformed in some manner to address the federal deficit. [Learn more, and download a couple free chapters or buy a copy at Greatexperiment.org] But for now, and since the ACA was upheld, the policy questions refocus on individual state implementation. Locally, conventional wisdom would tell […]

Pulling Back the Curtain on Beacon Hill’s “Healthcare Reform 2.0”

T-minus 13 days until the end of the legislative session and one of the largest and most controversial pieces of legislation has moved with almost no media attention. The promises for the new cost containment/ payment reform bills (or health reform 2.0, as some are calling it) — now being considered by a joint House-Senate conference committee — are historic, according to the rhetoric of the elected officials who authored it. It “completely alters the landscape of our delivery system,” and “will result in an estimated $150 billion in savings over the next 15 years.” “It is going to work because it is well thought out?… It is not going to hurt our best hospitals… We will be the first […]

Jon Gruber’s RomneyCare/ObamaCare False Narrative

This morning, Steve LeBlanc of the Associated Press has another Massachusetts focused story up titled “Mass. Health Law May Bode Well for Federal Law.” The piece is based on a common flawed assumption. The piece fails to mention Massachusetts’ pre-reform circumstances in contrast to other states now. It expects that the same actions and behaviors will play out in the same way in other states. To expand on my quote in the story, can we honestly suppose New Mexico with 20+% uninsured, no guarantee issue in their individual market, employer sponsored insurance rates of 48.6 percent, lower income levels, lower education level, low-medical infrastructure, and a geographically spread out state to see the exact same results as the Commonwealth? Contrast that with the  starting place […]

Are Fewer People in MA Paying the Indiv Mandate Penalty?

Since the Supreme Court upheld the ACA/Obamacare, there has been a renewed interest in the Massachusetts healthcare law. I have blogged many times before to caution readers and the media not to assume the two laws will lead to the same results, because they won’t, mostly as Massachusetts is not the same patient with the same ailments as New Mexico, or Michigan, or even Florida. I know I am fighting against the conventional wisdom,  but this issue warrants discussion as Congress passed a national program and modeled the behavior and cost estimates (incorrectly in my opinion) partially on our experience here in the Bay State. As a result of the national interest, I assume we will see more local reports […]

Pioneer Press Release on SCOTUS ACA Ruling

The Way Forward: Despite Supreme Court Ruling, New Start Needed on Health Care Reform Pioneer Institute calls for Congress to replace most of the federal health law and clear the way for state-based reforms BOSTON – Despite the US Supreme Court’s decision to uphold the Patient Protection and Affordable Care Act (PPACA), Pioneer Institute for Public Policy Research calls for a new approach to solving the nation’s health care problems. “The fact that this decision was made in essence by a single justice highlights the need for real solutions that can gain broad consensus across the country. The Court’s decision today will set off further state and federal conflicts that will likely end up in the courts once again,” says […]

The Myth of Cost Control Legislation

The House passed their version of “cost control” last night in a 148-7 vote. Sadly for taxpayers and the general public, there was little debate on the bill itself and the few minutes of debate on the floor revolved exclusively around a handful of amendments. Changing 18% of our state economy with little debate, no hard questions, in a few hours, no problem? Was this how we did it for health reform 1.0? The leadership accepted most special interest amendments in an effort to garner votes. Most of these provisions will be taken out in conference committee. What We Know 18% of the Massachusetts economy is health care related; 20% of patients account for 80% of costs, 5% of patients […]

Guide to Mass Payment Reform Amendments: Sex Ed, Podiatry, and Acupuncture

Find me on twitter: @josharchambault For those following at home, the House will debate their version of payment reform today and tomorrow. You can watch here starting at 1 pm and read the redraft of the bill here. 275 amendments have been filed, and legislators appear to be more focused on social policy, labor policy, and special-interest carve outs than health delivery and payment reform. Some of the more colorful amendments consist of: Social Policy: Studying sex ed in charter schools.(#30) 4 amendments dealing with family planning (#32, 139, 264, 265), removing ultrasound diagnostic imaging from the definition of an advanced diagnostic imaging service (#179), and health care equity (#217). Labor Appointments: There are 5 amendments giving appointments to the Massachusetts Nurses Association […]

Mass House Pulls a “Charlie Brown” on Payment Reform Redraft

The Massachusetts House rushed the release of their payment reform bill to beat the Senate the first time around. As a result, the next few weeks provided time for House lawmakers to receive feedback and improve the bill before it was to be voted on. Unfortunately, the bill’s authors missed the ball again, and made only small changes. Unfortunately, the House has decided to follow the Senate precedent of rushing passage of the final bill. 48 hours to file amendments, and only a couple more days before it is debated and voted on next week. [Changing 18 percent of our economy in two days, with many unanswered questions about added costs, lack of evidence of savings, and lots of new mandates, […]

Video: But Will The Cost-Cutting Bills Really Save Money?

The debate on Beacon Hill is heating up on payment reform legislation, but the public discourse has revolved primarily around dueling press releases.  There has been little discussion exploring the real challenges of fundamentally changing 18 percent of the Massachusetts economy with new payment and delivery methodologies. With 20 percent of patients accounting for 80 percent of health care costs, is this the right approach? Will it save money and engage consumers? CommonWealth magazine hosted a recent web discussion to cover a few of these topics. WBUR’s CommonHealth blog recently shared the video as well.

Is Maine Leading the Way on Health Care?

The Commonwealth is currently debating greater government intervention in our health care system with payment reform legislation. Maine is moving in the opposite direction. This press release was just put out by the think tank Maine Heritage Policy Center. Unprecedented: Rates for health insurance plans to drop as much as 60% PORTLAND – Rates for individual health care plans in Maine will drop as much as 60% in July as a result of health reform law PL 90, the free-market health insurance reform bill passed by the legislature last year. The Maine Heritage Policy Center was a key advocate of the bill. Information contained in Anthem’s most recent rate proposal indicates substantial positive results from the law’s passage. After years […]

Will Your Next Cancer Treatment Be In New Hampshire?

New Hampshire lawmakers have a long history of jeering Massachusetts over taxes, but it looks like they have moved to a much bigger sacred cow, health care. The Boston Globe ($)recently reported that in New Hampshire there is a bill, “eliminating a state review process and exempting it [specialty destination hospitals] from a tax that New Hampshire’s nonprofit hospitals pay.” By contrast, the two recently proposed payment reform bills on Beacon Hill move in the opposite direction. The bills “reform” the determination of need process to make it more government-centered and will severely limit any future expansion of similar facilities in the Commonwealth. Massachusetts policymakers should be watching our borders closely as they aim to significantly alter our local payment […]

Red or Blue Pill for Payment Reform? Both Won’t Work

Are the House and Senate giving us a false choice for how to control health care costs in Massachusetts? Aren’t there other options? A few major themes have emerged from the two payment reform proposals and highlight the fact that they fail to align incentives for patients to be more involved in the purchase of their health insurance and their health care. For example, even with full transparency of cost and quality (which is a huge lift on its own) for many patients, high-cost still correlates with higher quality in medicine. A recent report from Attorney General Coakley proved this theory wrong, but simply providing patients with cost data without placing the right incentives in their health plan to choose […]

Cart Before the Horse in Media Coverage of Massachusetts Payment Reform

Before digging into the Senate bill this afternoon, I wanted to express my concern about early media coverage of the payment reform debate. The spotlight has become focused on 3 or 4 points, all contained in press releases. No one can knowledgably comment on the Senate bill since they have not seen the full language- as they are still finalizing parts of it this morning. It is easy to say the two bills look the same from the press release, but are they? The debate over somewhat arbitrary cost growth goals is pointless, unless there is a debate about the mechanisms to get there. Did we forget that DHCFP data tells us 53% of employers are self-insured in our state […]

I Pledge My Faith in Bureaucracy- Mass Health Reform II

The House version of payment reform creates a new mega agency, the Division of Health Care Cost and Quality. To be fair, the House collapses a few other state agencies into the new Division, but there is no question this entity is given far-reaching and broad regulatory power. The Division will be independent and “not subject to the supervision and control of any other” public entity. (Section 29, subsection 2(a)) The controversial federal Affordable Care Act drew negative attention for how many times the Secretary of HHS was instructed to act on major policy, roughly 700 times in 2,700 pages. The House’s bill outdoes the ACA by requiring the division to take action 163 times in 178 pages, or almost […]

Many Unanswered Questions On Payment Reform

The next act of the Massachusetts health care reform drama is about to play out on Beacon Hill. As the same familiar characters return to the stage, the character who should be the hero of this drama, the patient, is nowhere to be found. Instead we are sitting down to a repeat performance. The language of reform is promising, but the reality of implementation remains hazy. Over the next few days I will blog on why the House of Representatives’ bill left out the patient as part of the solution. However, for now, below are just a few questions to prime the pump for this discussion and for you to consider: How will western Massachusetts comply with the state mandate […]

If Only Governor Patrick Knew What His Medicaid Office Was Up To

While Governor Patrick has been pleading with the Legislature to act on his February 2011 payment reform bill that would move our health care system towards global payments and accountable care organizations, his MassHealth (Medicaid) office has moved in the opposite direction. (You can read my testimony on the Governor’s bill here) In March 2011, the MassHealth program changed their default enrollment policy for new enrollees that did not affirmatively select a managed care option–either one of the 5 Medicaid managed care organizations (MCO) or the Primary Care Clinician Plan (PCC). Before the switch, if an individual, after being determined eligible for Medicaid, did not affirmatively select a managed care option, the MassHealth office would auto-enroll them into either one […]

Is Romneycare A Budget Buster?

The Massachusetts Taxpayers Foundation (MTF) put out a report late last week on the cost of Massachusetts health reform. The number from the report that has gotten the most media attention has been– $91 million. Over the five full fiscal years since the law was implemented, the incremental additional state cost per year has averaged $91 million… This is a very strange way to interpret the cost data. Here is the breakdown from the report: The better number to highlight would be the incremental increase each year over the 2006 baseline. 2006 2007 2008 2009 2010 2011 Over 2006 baseline (millions) – $268 $645 $1,037 $834 $906 If you add this up and divide by 5, you come up with […]

News Flash: Gruber and McDonough are Political

Jonathan Gruber and John McDonough are widely quoted in the media on both Romneycare and Obamacare. Without question they are both extremely intelligent, I have a deep respect for their commitment to health policy and enjoy the frequent interactions I have with them. However, I have wondered for months when the media will finally acknowledge that they both have a political angle.  This week President Obama’s campaign made it official by putting them into a video: Will this put an end to the neutral observer status afford them in most media stories?

How Much Do Same-Sex Marriage & Health Care Overlap Constitutionally?

Socially liberal commentators opine against some conservative’s preference to nationalize the issue of marriage when they argue so strongly for a federalist impulse in many other areas of policy including health care. On display this past month has been the exact opposite positioning by Massachusetts’ Attorney General Martha Coakley. It is interesting to juxtapose her two recent high profile affairs in the federal court system. First up was her amicus brief in support of the President’s Affordable Care Act (Obamacare) which argued that the federal government has the right to regulate health insurance because it is an example of interstate commerce. Weeks later she entered a federal appeals court leading the charge to uphold her earlier victory in court to overturn the federally passed Defense of […]

Applying Finance to Health Care: ROI of Wellness Programs

A new report from Health Fairs Direct, a corporate health and wellness events provider, asks the very important question: What is the most effective way to control rising healthcare costs? While they might be somewhat self-interested given their line of work running health and wellness events, the return on investment analysis should inform any company tackling this issue. The Connector has launched a wellness program recently and should examine this study for any best practices. The report analyzed 50 studies of the wellness programs offered at different organizations including Johnson and Johnson, Citibank, DuPont, Duke University and The California Public Retirees System. Here are the six best wellness initiatives Health Fairs Direct identified as producing the the greatest ROI: Health […]

WSJ on “The Great Experiment” in Health Care

Kim Strassel of the Wall Street Journal($) wrote on Pioneer’s health care book today, and  she highlights a very important historical point. Major entitlement reform is only possible when some level of national consensus has been achieved around end goals. In The Great Experiment: The States, The Feds and Your Healthcare we examine welfare reform in the mid-1990’s as a perfect example of this paradigm. Excerpt from The Wall Street Journal column: The more conservatives have been forced to think about health care, the more they’ve understood the merits of state experimentation. Jim Stergios, executive director of the Pioneer Institute—a free-market think tank in Boston that has published a book on ObamaCare and RomneyCare titled “The Great Experiment: The States, the Feds, […]

Understanding Obamacare’s Essential Health Benefits for MA: Square Peg in a Round Hole?

The Affordable Care Act (ACA) requires insurers to provide an essential health benefits package (EHB). ACA legislation identifies ten general categories of mandated coverage (see right hand side below). A recent HHS informational bulletin outlined the scope of EHB in any given state must be equal to: One of the three largest small group plans in the state by enrollment; One of the three largest state employee health plans by enrollment; One of the three largest federal employee health plan options by enrollment; The largest HMO plan offered in the state’s commercial market by enrollment. States will need to spend a significant amount of time deciding what “benchmark typical employer plan” they would like to use, or HHS will select […]

Hold the Cork for The Connector

The Connector made a “big” announcement about the Business Express program today– that all carriers are now selling in the exchange. But a little context is needed before we throw a party. In a September 2010 paper, I addressed the limited benefit of the Business Express program in the Connector. …Business Express (BE) also suffers from design limitations and does little to address the underlying reasons behind premium increases. It does reduce the monthly fee that small employers typically pay to third-party administrators from $35 per subscriber to $10 per subscriber, saving employers roughly $300 per employee per year. However, this reduced fee is not unique to the Con­nector. The Massachusetts Business Association contends that it offers a similarly low-priced plan. […]