The Massachusetts healthcare system succeeded in keeping overall per capita growth in total healthcare expenditures below the state's benchmark in 2013, according to a state report.
In 2012, Massachusetts lawmakers passed legislation meant to improve healthcare quality and reduce spending. The law established the Center for Health Information and Analysis, which monitors the state healthcare system's performance on an annual basis. Every year, the Massachusetts Health Policy Commission sets a benchmark for the annual growth of total healthcare expenditures . The benchmark is tied to the potential gross state product, or growth in the state's economy. The following five key findings from the Center for Health Information's latest report reveal how the state's healthcare system performed in 2013.
1. From 2012 to 2013, total healthcare expenditures in Massachusetts — the total amount paid by or on behalf of state residents for insured healthcare services — grew by 2.3 percent, notably slower than the 3.6 percent benchmark (although faster than the overall inflation rate of 1.5 percent). Total healthcare spending reached $50.5 billion last year, up $1.5 billion from 2012.
2. Commercial insurance expenditures accounted for 40 percent of total healthcare spending. Total spending in the commercial market increased by 2.2 percent from 2012 to 2013. In 2013, $18.6 billion of commercial insurance spending went toward medical care, while $1.9 billion was spent on commercial payers' administration of insurance, according to the report. Both premiums and benefit levels were basically unchanged from 2012 to 2013, compared to previous years, when statewide premiums increased and benefits decreased.
3. Spending for public health insurance coverage totaled $30.1 billion in 2013, accounting for 60 percent of the state's total healthcare expenditures. The largest health insurance programs run by the state —MassHealth and Commonwealth Care — accounted for roughly 25 percent of total healthcare spending ($13.4 billion), with nearly a quarter of state residents receiving coverage from one of those programs. Meanwhile, Medicare spending totaled $15.2 billion, and other public healthcare programs such as the Veterans Health Administration accounted for $1.5 billion.
4. While new policies meant to contain cost growth, such as alternative, value-based payment methodologies, could be partly responsible for slow healthcare spending growth, the Center for Health Information notes the state economy also grew slowly from 2012 to 2013, and healthcare expenditure growth has decelerated across the nation. Therefore, "it is difficult to distinguish the effect of Massachusetts-specific policy," according to the report.
5. Massachusetts officials have pointed to the state's two largest payers — Blue Cross Blue Shield of Massachusetts and Boston-based Partners HealthCare — as the primary cause of the 2.3 percent increase in overall healthcare expenditures. "You could almost say as goes Partners and Blue Cross Blue Shield, so goes Massachusetts," Center of Health Information Executive Director Aron Boros told The Boston Globe. However, BCBS has said its figures show a moderate 2.1 percent increase in spending, while Partners has said it will reduce costs over time through coordinated care in community settings.