Massachusetts likely to boost oversight of providers, insurers not meeting 3.1% spending cap

Providers and insurers not meeting Massachusetts' 3.1 percent healthcare spending growth cap will likely face more aggressive oversight from a state health policy panel.

In an April 14 public meeting, the board of the Massachusetts Health Policy Commission voted to keep the cost-growth benchmark for health spending at 3.1 percent for a fifth year, despite calls from some providers to consider individual spending caps for organizations.

In the meeting, the board noted that overall healthcare spending has exceeded the 3.1 cost-growth benchmark for the last two years, which resulted in calls for more aggressive oversight. 

"I think that market participants are concluding that there's not much of a consequence to going above the cap," David Cutler, PhD, commissioner and professor at Boston-based Harvard Medical School, said during the meeting. Dr. Cutler added that the commission should work to ensure providers and insurers meet the 3.1 percent benchmark or have robust performance improvement plans in place if they are exceeding it.

Other commissioners agreed, one saying they probably "need to get more aggressive" to ensure the cost-growth benchmark is met. 

"Setting of the benchmark is one tool in our toolbox, but we need to look at those other tools, particularly the performance improvement plans," Martin Cohen, a commissioner of the health policy board and president and CEO of the MetroWest Health Foundation, said during the meeting. "We may need to dig deeper in those instances where payers or providers are exceeding the benchmark and seek some real plans for assessing those situations." 

The cost-growth benchmark was established in 2012 under a state law that aimed to keep the growth of healthcare costs in line with other sectors of the economy.

Access the full meeting here.

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