$200B dream; Bureaucrats seek to defy realities of health costs.

PositionEDITORIAL - Editorial


Six years ago, Massachusetts embarked on an ambitious plan to extend health insurance to nearly every resident of the commonwealth. But even as they approved Chapter 58 of the Acts of 2006 - "An Act Providing Access to Affordable, Quality, Accountable Health Care" - lawmakers knew that they were largely taking a pass on the question of how to pay for the whole thing.

Their answer has now arrived with passage of a second landmark piece of legislation, a cost-containment law that pushes the industry away from fee-for-service to an accountable-care model for delivery of health care, and creates two major new bureaucracies with the mission of tamping down costs.

The Patrick administration and legislators claim that this law could save Massachusetts a staggering $200 billion over the next 15 years.

The history of health care reform to date strongly suggests the state will come nowhere near meeting that goal.

Recall that back in 2006, some lawmakers asserted that expanding coverage to those without it would actually save money. They cited an anticipated reduction in the use of emergency rooms as de facto primary care facilities, and the savings that would come by getting residents into the health care system, where they would enjoy regular checkups, thus preventing more expensive health crises.

Well, some of those goals have been met. More than 98 percent of Massachusetts residents have medical coverage, well ahead of the national average. A study released in June by a University of Illinois researcher finds that emergency room visits have been reduced by 5 percent to 8 percent. And it is hard to quantify the improvement in the quality of life for many residents who previously lacked access to medical insurance.

But those gains have come at price. A study released last year by the Beacon Hill Institute found that the cumulative increase in the cost of health care in Massachusetts from 2006 to 2011 was $8.6 billion.

To be sure, that estimate must be viewed against a background of rapidly rising health care costs around the country. And one must factor in the effects of the 2007-2009 recession, which meant lost jobs and disruptions to existing health coverage.

Nonetheless, David G. Tuerck, executive director of the Beacon Hill Institute, concluded that the reform law "caused costs to rise even faster than they would have in its absence."

Defenders of health reform may dispute the $8.6 billion figure...

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