Health Care Reform Works

Lessons from Massachusetts’s Health Care Reform

Massachusetts leaders discuss the merits of the state’s health care reform at a CAP event.

For more on this event, click here.

Massachusetts Gov. Deval Patrick joined stakeholders and health care leaders at a Center for American Progress event on April 13, 2011, to speak about the merits of Massachusetts health care reform and the ways in which the law will be changed moving forward to make it more effective.

The Affordable Care Act and the Massachusetts health reform law use similar approaches to expand coverage. Since the former is not yet fully implemented, the Massachusetts law provides a useful model for analyzing the Affordable Care Act’s potential effects. Gov. Patrick’s remarks—and the panel discussion that followed—analyzed the impact of the Massachusetts law, deriving useful lessons for national reform efforts.

CAP President and CEO John Podesta, in his introductory remarks, extolled the positive impacts of Massachusetts health care reform: “Under Gov. Patrick’s administration, health care coverage was expanded to 98.1 percent of the commonwealth’s residents, giving Massachusetts by far the lowest rate of uninsured residents in the nation.” Children are also covered at a rate of 99.8 percent—the highest in the nation.

Podesta also spoke of the broad, bipartisan support that helped push the health reform law through the state legislature—bipartisan support lacking during the national health care debate, despite the two laws’ similarities. Notably, Massachusetts health reform was originally passed under the Republican Romney administration, though Romney attempted to distance himself from the legislation as Republicans mounted their opposition to the Affordable Care Act.

Gov. Patrick pointed out the disparity between the actual impacts of health reform in Massachusetts and the supposed consequences of national health reform claimed by detractors. Although the right paints the Affordable Care Act as “job-killing,” the Massachusetts experience suggests otherwise.

“Health care reform is also good for our economic competitiveness,” Patrick said. And the numbers support Patrick’s claim: Massachusetts’s job growth is fourth in the nation, and the unemployment rate remains below the national average.

Panelist Andrew Bagley echoed Gov. Patrick’s argument that the budgetary impact of the health law was quite manageable. Bagley is the director of research and public affairs of the Massachusetts Taxpayer Foundation, which analyzed the fiscal impact of health reform in the commonwealth. “What we discovered was that in the four years from 2006 to 2010…the incremental cost to the state was roughly $88 million a year…in the context of a $30 billion budget, that’s less than one-half of 1 percent,” Bagley stated.

Though the budgetary impact of health reform was within projections, Gov. Patrick emphasized the need to rein in long-term increases in health care costs. Massachusetts is pursuing a number of measures to do just that, and Gov. Patrick noted that one of the strengths of the process surrounding health reform in Massachusetts has been the openness to changes.

Massachusetts’s approach primarily involved three components. First, Gov. Patrick instructed the commissioner of insurance to reject excessive increases in premiums, pressuring providers to lower costs of care. Secondly, Massachusetts allowed small businesses to pool together to increase bargaining power when purchasing insurance for employees.

The third approach, which Patrick described as the “big solution” to cost control, now under development, shifts incentive structures for care away from quantity of care toward quality of care. In doing so, the hope is to encourage providers to treat patients with a more targeted and efficient approach.

The Massachusetts health reform law stands out as a success story. The state has achieved near-universal coverage at a manageable cost while most states are suffering from insurmountable debt. While challenges remain, Massachusetts has been proactive in finding solutions. The Massachusetts experience therefore bodes well for national health care reform.

For more on this event, click here.

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