Governor Baker, Secretary Sudders Testify in Support of Administration’s Comprehensive Health Care Legislation
BOSTON – Governor Charlie Baker and Health and Human Services Secretary Marylou Sudders today testified in support of the Baker-Polito Administration’s comprehensive health care legislation. The legislation, titled An Act to improve health care by investing in VALUE, aims to improve outcomes for patients, increase access to care and bring down costs.
Testimony as prepared for delivery:
Governor Baker:
“Chair Friedman, Vice Chair Cullinane, Vice Chair Chandler, members of the committee: Thank you for the opportunity to provide testimony in support of H. 4134, An Act to Improve Health Care by Investing in VALUE.
“The legislation filed by the Administration is aimed at preparing our health care system to address pressing current issues AND face the future.
“The legislation is all about investing in value, with the goal of improving outcomes for patients, increasing access to care and bringing down costs.
“Overall as a state, we have seen modest success in slowing the rate of cost growth. Commercial spending growth in MA has been below the national rate every year since 2013.
“However, for many residents, the cost of health insurance coverage continues to increase. Massachusetts has the 3rd highest average family premiums and has among the highest (7th) employer-sponsored insurance premiums in the US.
“23% of Massachusetts middle-class families spend more than a quarter of all earnings on health care.
“We are getting squeezed at both ends with no relief in sight. Is this new?
“The situation we’re confronting has been decades in the making. It’s complicated and there is no silver bullet to solve it.
“The legislation we have proposed includes big, not marginal, reforms in five key areas:
· Prioritizing investments in primary care and behavioral health
· Improving access to high-quality, coordinated care
· Supporting community health care providers, including community hospitals and community health centers
· Managing health care costs and increasing affordability
· Promoting insurance market reforms
“For the past 50 years, the U.S. health care system has been focused primarily on promoting and supporting the technological advancement of medicine.
“That focus has cured disease, enhanced therapies, and saved lives. But even as that progress has continued, our health care system has failed to appreciate the changing nature of illness, and the systemic gaps in care delivery that have been created by this approach.
“We’ve seen it across the nation – and here in Massachusetts—with the opioid epidemic. A system that financially incentivizes writing a prescription over supportive and sustained therapy yielded an addiction epidemic of gargantuan proportions. This is a problem.
“For far too long, we have neglected preventive services that keep individuals out of our emergency rooms. Services like primary and behavioral health care, and investments in addiction care and supports for older adults.
“We can no longer afford to ignore this. The nature of illness has changed. Chronic illnesses are far more prevalent than they used to be, and we are living longer.
“For a variety of reasons, addiction and behavioral health issues are far more challenging than they were in the past, and we increasingly recognize how they are intertwined with physical illnesses.
“And, we continue to have a primary care shortage that was identified decades ago.
This is unsustainable. Simply put, our health care system is not designed to serve our changing patient population and health care needs.
“Changing a system requires more than increasing rates – we must proactively prioritize and incentivize services that prevent people from getting sick in the first place. We must invest in team-based approaches that treat the “whole individual” and intervene earlier.
“Our system should reward health care organizations that invest in a comprehensive set of physical and behavioral health services.
“Our proposal flips the script.
“This legislation is designed to create financial incentives for health care providers and payers to reprioritize their service delivery and payment decisions. It promotes system-wide investment in primary care and behavioral health services that are undervalued in today’s payment models and delivery system. Massachusetts has had significant success in attaining near-universal insurance coverage for residents of the commonwealth, and has started to see modest success in controlling overall cost growth.
“We’re proud of that success, but there is more to do – patients and their families continue to face barriers to accessing necessary care; while individual consumers and employers are burdened by growing premiums and out-of-pocket costs that consistently outpace the rate of inflation.
“We believe this bill builds on the strengths of our current system and past legislative reforms, while addressing the areas in which it falls short.
“Before getting into some of the details - While some proposals of this legislation are new, there’s also familiar proposals and areas of common ground including:
· Surprise billing
· Facility fees
· Prescription drug spending, including the regulation of PBMs
· Scope of practice, particularly advanced practice nursing
· Telemedicine
· Urgent care centers
· Supporting our community hospitals and community health centers
· Achieving parity
“Some people say it’s really hard to get to “yes” in this space. I understand that. But we are experiencing unprecedented challenges and stresses in the system. We can find common ground.
“Investing in primary care and behavioral health will increase access, particularly early identification and treatment.
“Today, less than 15% of total medical expenditures in Massachusetts are spent on primary care and outpatient behavioral health services combined. This must change.
“The legislation establishes spending targets for primary and behavioral health— requiring payers and providers to increase their spending on these services by 30 percent over three years—all within the parameters of the state’s overall health care benchmark.
“Performance against the proposed spending targets will be measured, and payers and providers held accountable through the framework established under chapter 224, the Commonwealth’s cost containment law.
“Provider and payer entities that do not achieve the target will be referred to the HPC and if determined appropriate, subject to a performance improvement plan.
“Recognizing health care provider systems and payers will have varying baselines, the legislation does not prescribe how systems must achieve the target.
“Performance against the targets will be measured off of the total medical expenditures (TME) of plan members and attributed patients for payers and providers, respectively. Using TME as a proxy for investment, we expect payers and providers to meet the target through modifications to price and utilization. Employing strategies such as:
“For providers:
· Increasing access to primary care and behavioral health services through expanding practice hours and/or site locations
· Modifying referral practices in a way that supports primary care and behavioral health clinicians spending more time with the patient, rather than a prompt referral to a specialist.
· Reallocating negotiated rate increases in favor of primary care and behavioral health service lines and clinicians.
“For payers:
· Targeting rate increases toward primary care and behavioral health service lines and clinician reimbursement.
· Modifying utilization management criteria and standards to promote time and therapy over transactional care.
“What will this mean for payers and providers? Payers and providers will need to reprioritize the dollars in the system and care delivery strategies in favor of primary care and behavioral health services. To achieve the target within the state’s cost growth benchmark may mean holding other service lines flat financially or tapering growth in specialty services and technologies.
“The legislation also proposes reforms to increase access to high-quality, coordinated care, not only for behavioral health care but for other services for which we know access barriers and gaps in treatment exist.
“For example, we want to allow practitioners to work at the top of their license. Currently, we are one of the 12 most restrictive states for Nurse Practitioners and licensed psychiatric nurses. Having nurses practice at the top of their license will increase access, particularly, but not exclusively for behavioral health.
“This is not a new idea. In fact, we worked on this 28 years ago when I was sitting in Secretary Sudders’ seat leading HHS.”
Secretary Sudders:
“Having spent my career in the behavioral health space and working alongside the Governor and our partners in the Legislature, I think we all can agree these reforms are necessary and a long time coming.
“First – more behavioral health practitioners need to accept insurance.
“Currently, approximately half of all licensed behavioral health care providers DO NOT accept insurance. Finding a practitioner that accepts one’s insurance is one of the biggest issues that I hear and one of the most significant barriers to treatment.
“This legislation proposes reforms to both encourage practitioners to accept insurance and remove other barriers to necessary behavioral health services.
“To address the administrative burdens associated with insurance contracting, we propose requiring all insurers, including MassHealth, to use a standardized credentialing application to be used by all insurers. Right now, practitioners are required to fill out multiple applications – sometimes for the same insurer, which can serve as a deterrent to network participation.
“We address rate inequities for behavioral health providers by having the Division of Insurance establish a rate floor for certain services based on the reimbursement rate for comparable services delivered by non-behavioral health, medical providers.
“The lack of behavioral health practitioners accepting insurance results in patients having to seek treatment from providers that are not in their insurance network, resulting in higher out-of-pocket costs. This happens far more often for behavioral health services than it does on the physical health side. To address this, we require payers to report to the DOI when their members are getting care from an out-of-network provider, which will inform DOI’s network adequacy review and determination.
“We’re also requiring insurers to reimburse non-licensed behavioral health professionals in training working in clinical settings under the supervision of a licensed practitioner, just as medical residents are reimbursed for services rendered while they are still in training, further signaling that behavioral health treatment is just as important as physical health. Currently, Medicaid is the only payer that reimburses for this.
“Anyone who has struggled with behavioral health issues knows that it isn’t just about access—it’s about timely access, and it’s about affordability.
“Eventually when someone is linked up with a therapist, they may be charged two co-pays for behavioral health appointments occurring in the same day; for example, seeing someone for CBT and someone for a medication check. Under our proposal, insurers are prohibited from denying coverage or imposing additional costs for same-day visits.
“We also know that behavioral health often goes hand in hand with substance use. In 11 of our hospital emergency departments throughout the Commonwealth an individual struggling with both substance use and behavioral health challenges may be paired up with a recovery coach – but each recovery coach’s training may be different since no agreed upon standard currently exists that is accepted by commercial insurance.
“Based off of recommendations from the legislatively created recovery coach commission, we propose the establishment of a state Board of Registration of Recovery Coaches to credential and standardize the recovery coach position to promote insurance reimbursement – while still protecting the personalized and unique perspective that recovery coaches offer.
“As the Governor already noted, the legislation also proposes reforms to increase access to high-quality, coordinated care. He mentioned how nurse practitioners would be able to practice at the top of their licenses. A long overdue reform. This legislation also:
· Authorizes Massachusetts to join the Nurse Licensure Compact – currently we are one of fewer than 20 states that have not joined a multi-state nurse licensure compact that allows nurses to work across state lines – the New England states of Maine and New Hampshire have signed the compact;
· Creates a mid-level dental provider position to provide basic dental services and expand access;
· Aligns scope of practice for optometrists and podiatrists with other states;
· Establishes a clear definition of telehealth services and requires insurers to cover certain telehealth services if the same service is covered in-person; and
· Defines and licenses urgent care services, requires that they must accept MassHealth members, provide behavioral health services, and meet certain standards related to primary care.
“This bill recognizes the critical role that community hospitals and community health centers play in the health care system by providing patient-centered, high-value care to some of the Commonwealth’s most vulnerable population.
“In recognition of the vital role these providers play and as part of our commitment to uncompensated care, on the date the bill was filed, we deposited $15 million into the Health Safety Net Trust Fund, which reimburses community health centers and hospitals for care provided to individuals who are uninsured or underinsured.
“The legislation proposes additional funding for community hospitals and health centers through a redesigned Community Hospital and Health Center Investment Trust Fund, with a specific focus on community hospitals and health care centers in need of extra support. Ongoing funding is derived from the existing CHIA transfer, and revenues generated from the drug manufacturer penalty and the proposed financial penalties (in lieu of a PIP) on health care entities that exceed the benchmark.
“Our legislation addresses rising health care costs across the system, as well as for employers and individual purchasers, including important consumer protections to ensure patients are not left with extraordinary out-of-pocket costs.
“As you know, this year, together with your support, we took bold action to control drug costs in the MassHealth program. And, it is an effective tool. So far, we have successfully completed negotiations with 5 manufacturers on 11 drugs, resulting in $10 million net savings. This will continue to grow.
“Today we are building on those efforts to address pharmacy costs by ensuring the same level of accountability and cost controls in the commercial market. There are
5 key elements to the drug pricing cost containment proposal:
· For drugs that have been in the market – impose fines on any drug that increases above inflation +2%.
· For new drugs to market, bring them into the Health Policy Commission for drug pricing accountability.
· Update the original provisions of Chapter 224 to include members of the pharmaceutical industry in the HPC Cost Trends Hearings.
· Ensure that when you go to the pharmacy to pick up your prescription, that you are paying the lowest price for that drug.
· Regulate the middle men, known as pharmacy benefits managers or PBMs, that we know add to drug costs.
“Too often, we also hear stories about “surprise medical bills,” which happen after someone goes to the emergency room and is treated by an out-of-network provider without their knowledge. No one should be penalized for something they weren’t made aware of in the first place.
“In addition to the cost to the individual patient – it’s a drain on the system.
“That’s why this legislation not only prohibits surprise billing but also creates a process for establishing an out-of-network default rate, a policy that will ensure providers are adequately compensated for services rendered, reduce unnecessary costs associated with payment disputes, and encourage contracting between providers and insurers.
“Similarly, this legislation addresses facility fees, which are another source of unexpected costs to the consumer and often unwarranted costs to the system.
“Finally, we need to make health insurance more affordable.
“Wherever you travel – individuals, families, employers large and small, are talking about the cost of health care.
“Rising premiums and out-of-pocket costs are crowding out income gains and straining economic growth.
“Massachusetts has the lowest uninsured rate in the country – this is important. But we continue to be one of the most expensive states in the country for health care.
“A stable and affordable insurance market is key to maintaining our near-universal coverage levels.
“Small employers are the backbone of our economy here in Massachusetts – they also play a vital role in our health care market.
“Yet we know that small employers experience higher year-over-year premium growth than other market segments.
“We propose providing our small employers with more affordable coverage options for their businesses and employees.
“Specifically, the legislation will ensure that high-value, affordable plans, such as those designed to steer patients to low-cost, high-quality providers, are easily accessible to small employers by promoting the availability and increasing the uptake of such plans.
“In addition to the proposed legislation, our Administration issued an executive order to create a commission tasked with conducting a comprehensive study of the individual and small group insurance market to understand the underlying trends that are contributing to growing costs for small and mid-size employers.
“The Commission is made up of insurers, employers, brokers and consumers to ensure that everyone has a seat at the table with recommendations due by April 30 of this year.
“This legislation is bold – it proposes to rebalance our entire health care system. Massachusetts is a hub for innovation and is home to incredible academic institutions, medical providers, and life sciences companies. Some of the greatest thinking in the space happens right here. This legislation is a prime example of health care innovation creative solutions.
“Many of the reforms we have proposed will help reduce costs while maintaining quality care and delivering a more cost-effective, nimble and patient-centric health care system for the 21st century.
“Shifts like the ones we are proposing represent change, and change – especially with the size and scale of our proposal – creates discomfort. That is to be expected.
“But the question we want to leave you with today: Will these shifts enable our health care system to modernize and better address changing needs, prepare Massachusetts for the future and deliver greater value to individuals? The Governor and I believe the answer is a resounding “Yes.”
