Rising health care costs bring call for ‘bold action’

Health care costs in Massachusetts continued to grow faster than household incomes, according to new research, raising concerns about access to care even before accounting for the recent upheaval caused by bankruptcy of Steward Health Care.

The latest annual health care cost report from the Health Policy Commission found that total health care costs per capita will rise to $10,264 by 2022, the first time crossed five figures and an increase of 5.8% over 2021. Total health care spending in Massachusetts HPC said that in the last 70 billion dollars, from $67.8 billion in 2021 to $71.7 billion by 2022.

That’s the second-highest annual growth rate since HPC’s inception a decade ago, trailing only the 2020 to 2021 period, which experts have described as outsized by reason for the “level” of spending after the start of spending. The covid-19 pandemic.

“Across all levels of care, the main driver of this growth was high prices, with no additional care being provided,” HPC said along with its report published on Thursday.

Under the spotlight, critics have cited a number of factors that point to the growing strain on Bay State families.

Massachusetts has the second highest family health insurance premiums in the country, and the average annual health care cost for a family is more than $29,000 when including out-of-pocket expenses. pocket, HPC said. The number of self-insured Bay Staters without affordable health care has increased by 50% in two years, from 600,000 in 2021 to 900,000 in 2023. Businesses They are struggling with costs, too, and are turning to high deductible plans. reduce premium increases, according to authorities.

“Effectively dealing with health care in a meaningful way will be necessary to achieve the goal of the Healey-Driscoll Administration to make the Commonwealth more economically competitive for families and businesses to stay and thrive,” HPC wrote. “These problems require bold action to move the health system from its current state to a new, affordable, sustainable and equitable path.”

Much of the growth in health care spending was driven by higher prices on the business side. Health care costs per insured member increased 5.2% in Massachusetts from 2019 to 2022, a higher rate than the national average for the same period or the same change of the state’s median household income, the HPC said.

Experts have also pointed to pharmacy spending as an area that is fueling the broader trend. From 2017 to 2019, pharmacy spending per enrollee increased by 0.7% per year; during the next three years from 2019 to 2022, it increased by 8.2% per year, according to HPC.

“Pharmaceutical spending has been one of the largest drivers of health spending in recent years in Massachusetts,” said HPC Executive Director David Seltz. “When we think about what we’ve seen with the use of some of these new blockbuster drugs, as well as the introduction of very expensive new drugs. [and] Gene therapy, I think we can expect to see that trend continue. ”

Administrators offered a new perspective in a recent report on Steward Health Care’s bankruptcy, although the latest cost figures through 2022 do not capture the system’s collapse that occurred this year.

Instead of renewing many of the recommendations from last year’s report – which lawmakers have so far not adopted – the HPC this time around has focused its attention on protecting the government from retribution. of Steward.

Administrators called for lawmakers to expand oversight tools, particularly by subjecting more transactions to HPC review; strengthening the transparency requirements that Steward is said to have criticized; better protect communities that have historically been underserved by health care; and dealing with pressure situations such as supplier price imbalances.

“Together, this is a very strong package of reforms that, if passed and implemented, would be an incredible step forward that would put us as a Commonwealth in a much stronger position to be able to to protect our system and plan for improvement,” Seltz said.

Participating in the long-running debate over government regulation, HPC leaders have for years been asking lawmakers to give them more regulatory muscle to broaden their horizons and force change. cost growth.

The House and Senate have each passed major health care reform legislation this year, but top Democrats have so far been unable to craft a compromise bill with the protections that lawmakers have sought. Lawmakers said it will prevent another Steward disaster from happening.

One question on Thursday from the commissioner, the President of the MetroWest Health Foundation, Martin Cohen, touched on the disagreement between Seltz and the health care manager of the Healey system.

Reflecting on the recommendations inspired by Steward, Cohen asked what kind of systems other states have in place. He said: “I don’t feel like we are at the forefront here.

“Looking at this list, I can think of at least a few states in each of these that are more extreme than Massachusetts,” Seltz replied. “I think it’s a fair assessment to say that we’re no longer a leader in many of these topics.”

Health and Human Services Secretary Kate Walsh disagrees.

“I think people have parts of it, but not the whole part,” Walsh said. “They might be strong in physician practices — I think of California that way. What I’ve read … is that people were looking at how Massachusetts is doing this, even in terms of Steward’s challenges, which other countries are dealing with. So I think we’re going ahead.”

A landmark 2012 cost-containment law set a “benchmark” goal for how much spending should grow each year in Massachusetts, and created the HPC to monitor a wide range of health conditions. of the government.

Although there were changes from year to year, the growth of expenditure remained close to the target set by the government at the beginning. Average spending increased by 3.4% per year from 2012 to 2017, which is a shade below the 3.6% figure.

But from 2017 to 2022, the average annual growth has increased to 4%, exceeding the goals during that period – and the latest data shows the second annual increase so far.

Other reports from government agencies and watchdogs have also warned recently about increasing pressure on the health care sector. More than four in 10 non-Management hospitals reported poor performance during a significant portion of the fiscal year.

“This is a time of seismic change for Massachusetts health care, and — as the data comes out [the Center for Health Information and Analysis] and HPC has made it abundantly clear – our patients and our providers are the ones feeling the aftershocks the most,” Mass. Health and Hospital Association President Steve Walsh said Thursday. “We look forward to to testify at the HPC hearing next month about how these major pressures, which extend far beyond the Steward crisis, are affecting every aspect of care delivery in the community.”