HPC: Health care spending to fall 10% in Mass.

Decline leaves time for more focus on policy, equity

AT LAST WEEK’S Health Policy Commission meeting, agency staff revealed that their current estimate is that total health care spending in the state will decrease 10 percent this year. Few expected to ever see health care spending fall, but the drop is happening because health care institutions canceled non-essential care that was not COVID related to keep our health care system from being overwhelmed and most people have been reluctant to seek out care unless they believe it to be absolutely necessary.

Where does that leave the commission, an independent agency set up in 2012 to cheerlead the effort to bend the cost curve in health care growth with the goal of keeping spending below the annual benchmark goal—currently set at 3.1 percent per capita?

With the cost curve bending dramatically, the agency indicated at its meeting last week that it is likely to take on enhanced roles in two areas:  health  care planning with a policy twist and working to advance a more equitable health care system.

A slide from a presentation at the commission’s meeting underscored this shift:  “The HPC will continue to analyze the impact of COVID-19 on spending and utilization in Massachusetts as data becomes available and monitor health system changes to inform policy efforts during and after the crisis.”  (Bold is from the HPC.)

I read their bolding of the words “inform policy efforts” to mean not only sharing facts, their implications, and possible solutions, but also to more affirmatively advocate for some policy action on an issue.  HPC has been somewhat reluctant since its creation to be seen as a policy advocate, but it has done so at least once in an area where it clearly was given some jurisdiction – the proposed merger of Partners HealthCare and South Shore and Hallmark Hospitals. The HPC opposed the merger and played a pivotal role in scuttling it in court.

The commission indicated last week it may weigh in on advancing capitation payments for primary care, supporting threatened health providers to ensure access/capacity, adopting Maryland-style hospital global budgets, and pursuing alternative payment models with new risk adjustments methodologies.

Commissioners also discussed financial threats to independent primary care practices and the pluses and minuses of parity in telehealth payment levels with in-person visits. Both discussions offered important ways for HPC board members to signal legislators, the Baker administration, and others about their views and concerns about these matters.

I also came away from last week’s meeting with a clear sense that HPC’s sense of its role to fully review and dive into proposed market transactions is in no way weakened by COVID-19.   Not only did a slide deck highlight continued worries about “consolidations” and “proposed market changes,” but Executive Director David Seltz, in his oral comments at the meeting, went out of his way to suggest that COVID-19 may well bring on a flurry of proposed market transactions starting this fall. His comments made me think HPC is concerned that, under a shadow of market chaos brought forth by COVID-19, one or more of our larger and better healed health care systems may decide that this would be a good time to put forward a major market transaction that would stand little chance of approval during normal times.

Adding an equity lens to all of HPC’s work was the second major theme to emerge at last week’s meeting.  The agency indicated it is going to undertake a significant commitment to advancing health equity under a set of core principles in a way that permeates everything that it does.

That’s a big commitment.

Agency officials indicated they intend to focus on issues directly under their control (staffing, creating an inclusive environment, the awarding of grants), but also expressed a desire to “be bold” as they engage with external agencies, organizations, and groups. Commissioner Barbara Blakeney wanted people who experience the impact of health care inequities to be part of an HPC advisory group. Commissioner Richard Lord raised the question of how and whether HPC would evaluate its overall efforts in carrying out its equity work.

HPC’s desire to advance equity goals makes me think that important structural factors that may be individually or in concert contributing to health inequities include:  the current configuration of health systems and/or any proposed changes to expand them;  the resource-starved reality confronting many providers that serve low income and racially diverse populations;  and the market reality that unfair high prices paid to our more prestigious providers who care for wealthier and whiter populations are unfairly subsidized by a flat premium structure that punishes lower wage workers—something that self-insured employers sadly contribute to as well.

These and other issues are well worth HPC exploration— in terms of characterizing the extant and nature of the inequities and the attendant disparate impacts resulting from them on the various groups that HPC named as needing protection. Even better would be for HPC to also weigh in on some policy solutions that would ameliorate the resultant inequities that it uncovers.

Meet the Author

Paul A. Hattis

Associate professor, Tufts University Medical School
With a few legislative tweaks to its mandate, HPC could even use both its expanded health planning efforts and data analytics tied to health inequities to require performance improvement plans that take on a new set of issues and challenges with our providers and insurers.

Wouldn’t that be interesting?