On Healthcare, Massachusetts Leads The Way, Again

Amid the hoopla about local Massachusetts star Aly Raisman, the Massachusetts legislature this past week wrapped up its session with a frenetic pace, passing dozens of bills in a matter of hours Tuesday night and into Wednesday morning. The local papers really don't care much about what happens at the State House, and the majority of that attention was focused on a new crime bill, which imposes mandatory strict sentences for multiple offenders of certain laws.

In the meantime, Massachusetts legislators passed (and Governor Patrick is expected to sign) an amazing new healthcare bill that has slipped under the radars of almost everyone. The law is focused on healthcare cost containment, and it sets limits as to the growth of healthcare costs.

There's a paragraph break here to let that sit in. The Commonwealth of Massachusetts has taken on squarely the challenge of controlling healthcare costs, opening the new chapter in my state's healthcare experiment. Round one was universal healthcare. Check. Round two is reining in spending.

I could not be more proud of the legislature, and my Governor, who worked on the healthcare cost control legislation. Unlike their counterparts in Washington, they actually get things done. The healthcare cost containment law contains many controversial parts. It may not work. But it is addressing what in my opinion is the biggest problem with our healthcare system today-- runaway costs. And it's happening here in Massachusetts, which has already shown it can lead the way with regard to healthcare. (Footnote: This bill passed without the help of a Governor named Romney.)

I don't know for a fact, but I am sure various industry groups were lobbying their brains out around this bill. To be sure, I am not entirely clear how the law will work. The state government is dictating a maximum level of growth for an industry that historically has been ruled by supply and demand. I will be investigating this more among those who are in the know.

The law also encourages the entire healthcare apparatus-- hospitals, doctors, etc.-- to look at their jobs from the standpoint of keeping people healthy, rather than just ordering tests and procedures. The healthcare system in the U.S. makes money by ordering tests and procedures (and prescribing medication), so it follows that the system orders a lot of tests and procedures (and arguably prescribes too much medication). Incenting the system to focus on keeping people healthy-- and rewarding the system for doing so-- will cut out costly procedures and lower costs.

There are many parts of the law that are ambitious and could very well work; one part of the law that in my opinion just won't work encourages end users to evaluate the costs of their own healthcare options. By providing transparency to the healthcare consumer about available procedures and options, the law believes the consumer will become a bargain shopper and pick the less expensive-- and still effective-- option. The problem with this thinking is two-fold. First, as the lion's share of costs are still covered by insurance, there's no real incentive for the end user to pick a cheaper option. Second, and more importantly, most consumers believe more expensive healthcare procedures are better procedures. One is not likely to go on the cheap when it comes to their healthcare.

Still, I applaud my state, its legislature, and Governor Patrick for accomplishing this momentous legislation. One of the biggest failures of universal healthcare in Massachusetts (in my opinion) is the fact that healthcare costs here are still rising. In theory, if everyone has access to basic care (which they now do in Massachusetts), the number of costly emergency room visits will be reduced dramatically, among other circumstances that would bring down costs. Unfortunately, the overall cost of healthcare has not gone down.

Governor Patrick and others realized this. No question about it, the universal healthcare experiment in Massachusetts has worked. Now on to round two. And if history is an accurate judge, we will be debating the same healthcare cost containment ideas on a national stage in the not-so-distant future.