Massachusetts Health Spending

Massachusetts’ health reform was Mitt Romney’s unacknowledged illegitimate child during his run for the presidency, and based on the most recent report from the state agency that tracks spending and other health issues, we can see why he wanted to deny having anything to do with the program.   (Mass. Report)   Its been a while since we checked in on Massachusetts, but the update seems to be the same–just can’t get spending under control.  A couple of years ago the state established an ambitious goal and program to keep spending at or below GDP growth in the state.  Not getting close.  Total health care spending in the state rose 4.8% in 2014, to $54 billion or $8010 per capita.  This was more than a percent over the state’s target of 3.6% and also was significantly higher than state GDP growth, which came in at 3.5% as well.  Almost all the increase was due to higher enrollment and utilization in the Massachusetts Medicaid program.  Consistent with national trends, almost all the newly insured growth under reform laws has been in Medicaid and the resulting costs are unsustainable and when transferred to the states in a couple of years will kill their budgets.  Massachusetts is giving us a preview.  Ironically, Massachusetts is trying to keep Medicaid spending under control by cracking down on eligibility, which creates more uninsured people.  Commercial insurers kept spending under pretty good control, at 2.9%, but member cost-sharing rose almost 5%.

In general, Massachusetts health care providers delivered services consistent with national averages under various quality measures.  For some conditions, however, there were higher rates of avoidable hospitalization than the national averages.  Patient satisfaction with care was generally high, although a relatively high percent said that they did not understand discharge instructions following a hospitalization.  There also were access to care issues for some groups of minorities.  And, as is the case nationally, specialty pharmacy costs are a particular concern.  As with national reform efforts, Massachusetts’ is not living up to promised performance.