Massachusetts bill would fine hospitals up to $750K over primary care spending: 6 notes

Massachusetts lawmakers are considering a bill that would require hospitals, insurers and other healthcare entities to incrementally raise primary care spending to 15% of total healthcare expenditures by 2030.

The Senate passed the bill June 18, and it now sits before the House Ways and Means Committee ahead of a July 31 deadline.

Six things to know:

1. The bill would set escalating aggregate primary care expenditure targets tracked by the state’s Center for Health Information and Analysis: 9% of total healthcare expenditures in 2028, 12% in 2029 and 15% in 2030 and beyond.
   
2. It would also establish an Office of Primary Care Policy and Payment within the Health Policy Commission and a Primary Care Technical Advisory Council, co-chaired by the director of MassHealth and the commissioner of insurance.
   
3. The legislation would create an “advanced primary care payment model” requiring commercial insurers to pay primary care practices a prospective per-member-per-month rate instead of fee-for-service, with at least 90% of that payment retained at the practice level and prior authorization eliminated for covered primary care services.
   
4. Healthcare entities that miss their targets could be required to file performance improvement plans and face civil penalties starting at $500,000 for a first violation and $750,000 for a second.
   
5. The bill would require commercial insurers to reimburse federally qualified health centers at rates at least equal to MassHealth’s fee schedule and would revive a Medicaid graduate medical education program, cut in 2010, to fund residencies in community-based primary care and behavioral health.
   
6. The push comes as 30% of Massachusetts residents report difficulty accessing primary care, and only 6.6% of commercial health spending in the state went to primary care in 2024, according to The New Bedford Light, which cited state data. Massachusetts Health & Hospital Association Vice President Leigh Simons said the association supports the bill’s goals but urged “serious caution around measures that would unintentionally weaken” the state’s healthcare system, the Light reported July 16.

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