Joint Committee on Health Care Financing Hears Health Care Affordability & Shared Responsibility Bills

The Joint Committee on Health Care Financing held a hearing Wednesday afternoon on several bills including one of the ACT!! Coalition’s priority bills on health care affordability.

An Act Relative to Health Care Affordability

Shanna Shulman, Director of Policy and Research at the Blue Cross Blue Shield Foundation of Massachusetts presented data relevant to S. 549/H. 1102 An Act Relative to Health Care Affordability. Dr. Shulman provided an overview of the Urban Institute survey of affordability of health care for consumers across the state. The survey explores medical debt and out-of-pocket costs with a focus on trends in affordability since the passage of health reform and disparities in affordability of health care. The survey found that 18% of residents report that their out-of-pocket costs are equivalent to 5% or more of their family income, 7% of residents report that their out-of-pocket costs are equivalent to 10% or more of their family income, 18% of residents report problems paying medical bills and 20% of residents report having medical bills they are paying off over time. The survey also found that 11% of residents report that they did not get needed care because of costs in the last 12 months. The percent of residents reporting high out-of-pocket costs has declined since health reform but the percent of residents reporting problems paying medical bills has increased slightly. Dr. Shulman informed the Committee that low-income residents report more difficulty affording medical care and residents in Western MA are more likely to report not getting needed care because of the costs. Dr. Shulman’s full testimony can be read here.  During the discussion, Sen. Canderas highlighted disparities in affordability and access in Western Mass.

Lindsey Tucker voiced the ACT!! Coalition’s support of An Act Relative to Health Care Affordability (S.549/H.1102).  This bill addresses cost and affordability in two ways: one, redefining the state’s Affordability Schedule to include out of pocket costs and two, creating a new Division of Health Insurance with more power to regulate health insurance premiums.  The first will ensure consumers are protected from health costs they cannot afford, and the second will improve public accountability and transparency of health insurers.  Lindsey explained the disparate impact that co-pays have on the elderly and those with chronic diseases and how unaffordable cost-sharing leads to crippling medical debt. ACT!! urges the Legislature to consider out-of-pocket cost as part of the affordability schedule to protect consumers from unaffordable health coverage.  For more details read the ACT!! testimony here.

Dorcas Grigg-Saito, the CEO of the Lowell Community Health Center, shared the struggles many of her clients have with the costs of health care. Grigg-Saito informed the Committee that the Lowell Community Health Center serves one-third of the population of Lowell and 93% of the patients are below 200% fpl. Grigg-Saito explained that health reform has reduced the percentage of uninsured patients at her health center but health care costs still serve as a barrier to care especially for patients with chronic diseases, existing medical debt and those who have recently gained coverage after years of being uninsured.

Senator Moore raised concerns that exempting more people from the individual mandate would raise the number of uninsured residents and potentially increase hospital bad debt. Rep. Lewis questioned the Connector’s reasons for not including all cost-sharing in the Affordability Schedule.

Rep. Scibak also testified in support of H. 1102. Rep. Scibak described the provisions of the bill which would create a new Division of Health Insurance. Without increasing costs or staff this new agency would focus on affordability, consumer protection and improving the health of the Commonwealth by ensuring solvency of plans, regulating rates, overseeing benefits, and enforcing cost control initiatives; assure that health insurance premiums are kept as affordable as possible and that insurers serve the public interest; and improve public accountability and transparency of health insurers.

Next, Eric Linzer of the Massachusetts Association of Health Plans testified in opposition to S. 549/H. 1102. MAHP raised concerns with creating a Division of Health Insurance when DOI already has the authority to examine rates. MAHP also argued that most of the premium dollar goes toward medical expenses and the percent of administrative costs has decreased from 2007 to 2008. MAHP raised concerns that the bill doesn’t address the ability to change provider contracts if premium increases are found to be excessive

An Act Relative to Shared Responsibility in Health Reform

Wilnelia Rivera, Campaigns Director for Neighbor to Neighbor testified in support of S. 550/H. 1084, An Act Relative to Shared Responsibility in Health Reform. Health Care For All and a large number of partner groups, including, AARP Massachusetts, Coalition for Social Justice, Community Catalyst, Community Partners, Greater Boston Interfaith Organization, Health Law Advocates, Massachusetts Business Leaders for Quality, Affordable Health Care, Massachusetts Communities Action Network, MIRA Coalition, Neighbor to Neighbor, Public Policy Institute, SEIU 615 and 1199 SEIU strongly support S. 550/ H. 1084. The bill addresses the minority of Massachusetts employers not contributing their fair share to health reform.  The proposal’s goal is to spark a discussion on health reform funding, and the fair obligations that ought to be imposed on employers who are benefiting from the expansion of coverage to their workers.  The bill offers four methods for increasing employer responsibility, which would even the playing field for non-offering employers and reimburse the state for part of its cost in covering workers. Read Health Care For All’s full testimony here.

Other Bills

• Rep. Garballey testified in support of his bill, H. 1072, An Act Studying Home Health Service Rate Cuts.
• Rep. Bosley testified about how his bill H. 1065, An Act Creating a Single-Biller System would reduce administrative costs and complexity and help tackle how to pay for health care.
• Don Thieme, Executive Director of the MA Council on Community Hospitals testified in support of S. 554, An Act financing health care through moral obligation bonds and explained how this bill has the potential for significant savings for community hospitals with no cost to the state.
• Mass. Hospital Association Executive Vice-President Tim Gens testified in support of S. 556, An Act relative to equitable funding for the Division of Health Care Finance and Policy. Gens explained that hospitals contribute 65% of the funding for DHCFP and that this bill would direct DHCFP to develop recommendations to find a more equitable source of funding and cap payments from hospitals to DHCFP.
• SEIU Local 509 testified in support of H. 1070, An Act to ensure transparency in executive compensation at private sector human service agencies by explaining that this bill will ensure that state money that funds agencies is well accounted for and funding goes towards services for the most vulnerable population.
• Karen Granoff, Senior Director of Managed Care Policy for the Mass. Hospital Association, spoke in support of H. 1077, An Act relative to minimizing unnecessary health care costs by streamlining administrative requirements. Granoff explained to the Committee that this bill will reduce the cost and complexity of administrative work and billing. Rep. Grant voiced her support by stating that standardization of administrative requirements would be an excellent direction for the state to move towards.

-Catherine Hammons