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Legislators vow bill to curb health care costs

By Liz Kowalczyk
Globe Staff / June 28, 2011

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State legislative leaders made their strongest statements yet in support of placing significant cost controls on health care, predicting yesterday that they will agree on a bill as early as the fall.

Senate and House leaders who spoke on the first day of a public hearing sponsored by Governor Deval Patrick’s administration provided new details about the proposal they are writing, and what they consider the key elements needed to improve the quality of care for patients, while at the same time reining in payments to hospitals and doctors.

They struck an aggressive tone, saying they would go further than Patrick did in his recent legislation.

A key component of their proposal, they said, would be to address inequities in what insurers pay hospitals and doctors groups, as highlighted in a report released last week by Attorney General Martha Coakley’s staff. Providers with brand names or geographical dominance, her staff concluded, are able to demand higher prices than others for providing similar care.

Coakley’s investigation concluded that even a new budget-minded way of paying providers, embraced by Patrick in the legislation he filed, will not save money unless officials solve underlying disparities in what providers are paid.

The governor and many legislators want to move to a system of “global payments,’’ in which providers are paid a monthly per-patient budget for care, rather than allowing them to bill for each separate service rendered to a patient, with few limits on the number of services.

“Our concern turns to outrage when we learn that there is no direct correlation between the cost of health care and the quality of care received,’’ Senator Richard Moore, Democrat of Uxbridge and Senate chairman of the committee on health care financing, said in his remarks.

Lynn Nicholas, president of the Massachusetts Hospital Association, said in an interview after the hearing that the rhetoric used by legislators was surprising.

“There doesn’t seem to be an appreciation or recognition that hospitals are really serious about moving into new models of care with new accountability and fostered by a new payment system,’’ Nicholas said.

She said data from Coakley’s office and from the administration, both of which are based on 2009 information, are not “current enough to reflect how the market is already evolving.’’

After his speech, Moore said those inroads made by insurers and providers are not consistent and officials “need to keep the pressure on.’’ He said he expects a joint House and Senate bill will be completed by the fall, and it will contain stronger incentives for residents to join wellness and prevention programs.

He signaled that he wants an independent authority insulated from politics to oversee the transition to a new payment system, rather than giving the administration this responsibility.

Representative Steven Walsh, a Lynn Democrat who is House chairman of the committee on health care financing, echoed Moore’s strong statements.

“We will be bolder and more aggressive than ever before,’’ he said.

He said he wants to offer “the market more concrete goals’’ for controlling prices than the governor did in his proposal.

There is a perception among many on Beacon Hill that the issue has gotten caught up in the back and forth negotiations over legalizing gambling, which House Speaker Robert A. DeLeo wants to push forward. The Senate and the governor, meanwhile, need DeLeo on board for meaningful changes in the health care payment system.

Liz Kowalczyk can be reached at kowalczyk@globe.com