New England News
6:03 pm
Wed April 10, 2013

Business Community Worried About Rising Healthcare Costs in Massachusetts

In an article recently published by the Wall Street Journal, Massachusetts is the state with  the highest per-capita expenditure on healthcare, with the average individual paying more than $9,200 a year on health care costs. Expenses taken into account include emergency care, physician visits, nursing home care, prescription drugs, dental care, and other categories.

Credit 401(K) 2013/Creative Commons

And the business community in Massachusetts is worried that costs will continue to rise.

Kristen Lepore, Vice President for Government Affairs at Associated Industries of Massachusetts, said that healthcare costs are the number one concern among members across the state.

“We survey our members every couple of years and healthcare costs consistently top the list,” said Lepore.

The Healthcare Cost Containment Bill signed by Governor Patrick in 2012 aims to restrict the growth of healthcare costs to no faster than the growth of the state’s economy. For 2013, a goal of 3.6 percent has been set.

The legislation would shift the fee-for-service payment system currently in place in healthcare to a payment based on outcomes. The law also sets up several incentives to encourage the private sector to work to find ways to reduce healthcare costs.

Mike Supranowicz, President and CEO of the Berkshire Chamber of Commerce, said that one such pilot program is through the Massachusetts Association of Chamber of Commerce Executives, called the Chamber Health Care Co-op. Through the Co-op small businesses across the state can participate in a group-buy program for health insurance. A business would be able to sign with a provider at a discount rate if certain criteria are met under state law.

“One of the things that the state required is that we implement a wellness portion tied to the health insurance. So each one of our companies that signs up for the discount, also signs up for the wellness program,” said Supranowicz.

But Supranowicz said that certain criteria for the group-buy discount that qualify under state law, conlict with the standards outlined in the Affordable Care Act.

“The Affordable Care Act is taking wellness away as a measure,” said Supranowicz. “We’re very concerned at this point in time that if our governor does not help us get waivers on some of the pieces of legislation in the Affordable Care Act, that the small business group insurance may have premiums go up by 15 or 20 percent.”

Kristen Lepore said originally, industry groups in Massachusetts like AIM were not as worried about the ACA because more than 95 percent of state residents already have health insurance under state law. But now, she says, that perception is changing.

“That was certainly our position a year ago, but as we learn more about what is required in the Affordable Care Act as the guidance and regulations are released, the more we believe this to be true,” said Lepore.

As components of the state’s Healthcare Cost Containment take effect, the state’s independently operated Health Policy Commission will begin analyzing data to see if the rate of healthcare costs is on target to meet the 3.6 percent goal.

Kim Haberlin, a spokesperson for the Health Policy Commission, said that public hearings will be held this fall and winter, where in talking with small businesses, it may be possible to see the first signs of progress on the Healthcare Cost Containment.

In the article by the Wall Street Journal, Connecticut was the state with the third highest healthcare costs in the nation, while New York was the sixth. The District of Columbia itself had higher healthcare costs than any of the 50 states. 

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