Massachusetts Medicine After Cost Control

Massachusetts entered its second phase of health reform with the 2012 passage of Chapter 224, cost-control legislation titled “An Act Improving the Quality of Health Care and Reducing Costs Through Increased Transparency, Efficiency, and Innovation.”

While the first phase — Chapter 54, passed in 2006 — was indeed landmark legislation and served as the model for the Affordable Care Act, Chapter 224 alters the state’s healthcare industry perhaps like no other law.

The changes this law brings are vast, from payment reform to giving the attorney general new powers in the healthcare marketplace. Although 224 does include some benefits for physicians (medical-malpractice reform, for one), other provisions pose significant challenges, particularly for physicians in small practices. Here are two that raise concern.

• Health-information technology. One of the biggest challenges presented by Chapter 224 is its embrace of health-information technology (HIT). Physicians will be required — as a condition of licensure — to demonstrate proficiency in all aspects of health-information technology by Jan. 1, 2015.

While the Mass. Medical Society (MMS) supports HIT and recognizes its intent to improve patient care, this provision of the law could severely disrupt medical care. Because the statutory language creating the requirement is tied to federal standards of ‘meaningful use’ (which in turn is tied to participation in Medicare and Medicaid), it raises concerns that strict interpretation of this provision would lead to denial of license renewals for some 26,000 physicians. Our state has a high certification rate for meaningful use, with more than 14,000 physicians having met stage 1 requirements, but nearly 40,000 physicians have a Massachusetts license, and most are not included in the population targeted for meaningful-use certification.

Additionally, the costs of establishing HIT can be huge. The outlay for such items as implementation, maintenance, software and hardware upgrades, conversion to federal ICD-10 codes, training, and data conversion could approach well over $500,000 for some practices, not including the ‘opportunity loss of income’ from decreased productivity. While the law allows for assistance to providers for HIT, the level of help is unknown, and the financial burden can be crippling to small practices.

• Data collection and reporting. Chapter 224 is equally enthusiastic about data collection and reporting. It creates a ‘provider organization registration program,’ requiring organizations to provide detailed information about costs, financial performance, utilization, total medical expenses, and patient referral practices, among other information. This data is difficult to extract from many EMR systems.

This information will be collected by the Center for Health Information and Analysis (CHIA), a new, independent state agency created by 224 that takes over most of the responsibilities of the Division of Health Care Finance and Policy, which was abolished by the law. Physician groups are now required — for the first time — to submit such data. The law contains language focusing on the reporting on risk-bearing groups while exempting smaller groups, but the applicability of this language has not been fully tested yet, so it isn’t clear how reporting requirements will be enforced and upon whom.

On a promising note, CHIA Executive Director Aron Boros recently told the MMS House of Delegates that CHIA’s goal is to gather “reliable and meaningful” information through an “engaged transparent operation.” He believes his agency must be “transparent, open, and collaborative” to build credibility.

The law also stipulates that providers must now disclose to patients, within two working days of their request, how much a proposed procedure or service costs and what the health plan offers as payment. I am not optimistic that physicians will be prepared within a month’s time to inform patients about specific or estimated costs for all procedures. We are encouraging legislators and the Health Policy Commission to implement the law incrementally, by considering the most expensive procedures first.

Even in a highly sophisticated medical environment like Massachusetts, no less than 64{06cf2b9696b159f874511d23dbc893eb1ac83014175ed30550cfff22781411e5} of our physicians are in practices with fewer than 25 physicians. Regulations that burden these practices and reduce their viability will not only affect the quality of care but will also reduce healthcare access for Massachusetts residents. –