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The Massachusetts Experiment Analyzed: Provider Payments Based On Their Negotiating Strength, Not Quality Of Care

Massachusetts Attorney General Martha Coakley released her office’s second annual report, An Examination of Health Care Cost Trends and Drivers (PDF; see also press release), which contains a wealth of critical data analysis — and also highlights how little we know about certain things — providing some important context for the discussion of the proposed Part III of Massachusetts health reform, a bill filed by Governor Patrick which would create all-payor ACOs and a system of global payments.

At this late date, few would argue against a move a way from fee-for-service reimbursement for health care, or adding quality metrics to the mix, and tying financial rewards to providers to their performance measured against these metrics.  (Consider the Massachusetts Blue Cross Blue Shield ACQ (alternative quality contract) experience.)  The AG’s report, however, highlights the wide disparities in payments to providers based on negotiating strength, rather than quality or cost of care (as noted in last year’s AG report; check out the 2009 special commission report, too). Read more »

*This blog post was originally published at HealthBlawg :: David Harlow's Health Care Law Blog*

Employer Programs Are Reducing Healthcare Costs

Bad news in the paper today: health care costs are expected to rise another 10.5% next year. It’s a serious problem that affects businesses and families across the country.

But the headlines miss something important: the rate of increase has been steadily slowing.

Are we already bending the health care cost curve?

Here is a chart of the rate of increase in health premiums for a PPO plan beneficiary from 2002-2009 (all data are from today’s Aon press release):


The data for other plan types are similar.  What’s happening?

Aon’s Chief Medical Officer Paul Berger says it’s because of the variety of measures employers have taken over the last several years to implement programs to improve their employees’ health.  He emphasizes there is still much more to be done.

He has a point. It’s something we have seen in our survey of major employers, and in the work that leading employers like EMC and Genzyme are doing.  It’s what my company does, too.  Employers are getting increasingly sophisticated at understanding what drives their health care expenses and are developing increasingly effective ways at addressing them.

So, yes, of course, we need reform of our health care system, and of course rising health care costs are a serious concern.  But American employers are doing something about these problems all on their own.

*This blog post was originally published at See First Blog*

Latest Interviews

IDEA Labs: Medical Students Take The Lead In Healthcare Innovation

It’s no secret that doctors are disappointed with the way that the U.S. healthcare system is evolving. Most feel helpless about improving their work conditions or solving technical problems in patient care. Fortunately one young medical student was undeterred by the mountain of disappointment carried by his senior clinician mentors…

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How To Be A Successful Patient: Young Doctors Offer Some Advice

I am proud to be a part of the American Resident Project an initiative that promotes the writing of medical students residents and new physicians as they explore ideas for transforming American health care delivery. I recently had the opportunity to interview three of the writing fellows about how to…

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Latest Book Reviews

Book Review: Is Empathy Learned By Faking It Till It’s Real?

I m often asked to do book reviews on my blog and I rarely agree to them. This is because it takes me a long time to read a book and then if I don t enjoy it I figure the author would rather me remain silent than publish my…

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The Spirit Of The Place: Samuel Shem’s New Book May Depress You

When I was in medical school I read Samuel Shem s House Of God as a right of passage. At the time I found it to be a cynical yet eerily accurate portrayal of the underbelly of academic medicine. I gained comfort from its gallows humor and it made me…

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Eat To Save Your Life: Another Half-True Diet Book

I am hesitant to review diet books because they are so often a tangled mess of fact and fiction. Teasing out their truth from falsehood is about as exhausting as delousing a long-haired elementary school student. However after being approached by the authors’ PR agency with the promise of a…

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