Health care pricing commission kicks off six months of work

Printed from:

STATE HOUSE — Attempting to incorporate 23 different perspectives in a process featuring about 27 hours of public work, members of a special commission on Tuesday set out to seek solutions to an issue that has vexed the health care industry and policymakers for years: variations in health care pricing.

The commission, created as part of a law passed this summer to avoid a ballot question fight over pricing, has until March 15 to file its recommendations and any draft legislation, which members described as a tight timeline to reach consensus on a complex issue.

“One of the things that I think will be our biggest challenge … is the filter that we use for what we want,” said commission member Lynn Nicholas, head of the Massachusetts Hospital Association. “And that is, do we have a shared vision for what we think the health care system of tomorrow should look like?”

The 23 members of the commission include representatives of hospitals, insurers and employers of different sizes, along with health economists, lawmakers and state officials.

At the first meeting on Tuesday, commission co-chairs Rep. Jeffrey Sanchez and Sen. James Welch expressed optimism their group’s work would yield results while stressing the six-month timeframe.

“It’s tight, but I think the timeframe issue is really the motivation that we have to make sure that we come in, we get to work, everybody’s opinion is listened to, everybody’s ideas are encouraged,” Welch, a West Springfield Democrat, told reporters.

Sanchez, a Jamaica Plain Democrat, outlined a timeline for the commission, ending with a slide reminding members that their report is due in 182 days, following eight meetings and six subcommittee meetings.

“We have 27 hours,” he said. “We have 27 hours to go through this subject. It’s complex, and it’s controversial, and I think that this group was brought together to frankly have a frank discussion about where do we go.”

Between now and March, the commission plans to hold nine three-hour meetings that Sanchez said will be open to the public. Between the meetings, Sanchez said his chief of staff Sarah Sabshon and other staffers will be available to answer members’ questions.

Meetings will cover topics including the Medicare payment system, MassHealth rate-setting, contracting practices between providers and insurers, insurance plan design and patient and employer incentives, price transparency and the state’s role in the market. The commission will accept testimony from the public at a Jan. 17 hearing. Three subcommittees will further probe the topics of transparency, market forces and state monitoring.

Two commission members representing the Baker administration — Health and Human Service Secretary Marylou Sudders and Lauren Peters, director of health care policy and legislative affairs for the Executive Office of Administration and Finance — pegged transparency as a key element.

“We would say that a priority for the administration is providing transparent data in order for consumers to make informed choices about where they get their health care,” Sudders said.

While steadily rising costs are seen as a burden on government, business and family budgets, the health care industry is also a major source of jobs in Massachusetts and the Legislature has been reluctant to move toward price regulation, in part due to impacts on care providers but also due to philosophical differences about the role of government in the marketplace.

Commission members shared a range of priorities as they introduced themselves Tuesday.

Steve Carey of Polar Beverages said his company is proud of the benefits it offers its employees but feels a need “to reel in costs and keep things in line.” Group Insurance Commission executive director Dr. Roberta Herman voiced a similar perspective, saying she wanted to ensure state employees and retirees could access high-quality care “in a way that is sustainable to the commonwealth.”

Massachusetts Eye and Ear CEO John Fernandez, the chairman of the Conference of Boston Teaching Hospitals, said he hoped the commission would consider the public-payer system and allow for “a little bit of variation for teaching.”

“Without doctors, nurses and technicians, it would be hard to have health care,” he said.

Anna Jaques Hospital president and CEO Mark Goldstein urged the other commission members to recognize the “vulnerability of community hospitals.” He said the smaller hospitals are usually the largest employers in their area and often provide care at a relatively low cost.

The health care workers union 1199 SEIU had proposed a ballot question its members said would aid community hospitals, which would have set a floor and a ceiling on negotiated prices between private insurers and health care providers.

To head off what was expected to be costly and contentious referendum fight, Gov. Charlie Baker and legislative leaders brokered a deal between the union and Partners HealthCare, which stood to lose as much as $450 million in payments under the ballot question. The compromise directs $120 million over five years to hospitals across the state and created the commission to study price variation.

On Tuesday, Tyrek Lee, the executive vice president of 1199, described his union as “the ones with the blunt instrument that I think somewhat got us here” and said he believed the commission would come up with “strong” recommendations despite the complexity of price variation.

Partners president and CEO Dr. David Torchiana said his organization has “been identified as the source of the problem.” He said Partners has a “very complex four-part mission” that involves an educational program, scientific enterprise and community service as well as serving patients.

“We are doing those things in competition with national organizations in other cities, all of whom are getting paid a lot more than we’re getting paid — a lot more than we’re getting paid,” Torchiana told reporters. “So unless we look at the actual issue of where does Massachusetts health care costs stand on the spectrum, what are Massachusetts rates and rate variations compared to the spectrum, this whole process is potentially a very punitive process to us specifically, and I believe we’re one of the greatest institutional assets that this region possesses.”

During the meeting, Torchiana raised concerns that the information the commission had to work off of is incomplete.

Lora Pellegrini of the Massachusetts Association of Health Plans asked if it would be possible to have the Health Policy Commission or Center for Health Information and Analysis present findings so everyone would start from the same foundational data. Sanchez said time would not allow for it, and many of the commissioners were either involved in producing or had studied the agencies’ reports.

In the end, Welch said, not everyone may feel “100 percent comfortable with what this commission ultimately proposes, if we propose anything.”

“But I think more than anything, everybody on the commission is going to feel as though they had their ability to participate and say what was on their mind and say what was important to them,” he told reporters.

The commission plans to meet next on Oct. 11 when the Medicare payment system is on the agenda. Welch and Sanchez plan to pick the subcommittee chairs and commission members next week plan to check in on which subcommittees they hope to serve on.

— Written by Katie Lannan

Copyright State House News Service