Dramatic changes in the way the health care industry functions, propelled by what one House leader called the "gentle push" of state government, would shave $66 billion from industry spending in Massachusetts over the next 15 years under a bill outlined by Massachusetts House leaders that requires medical costs to grow at a slower pace than the gross state product.
According to House Speaker Robert DeLeo, House leaders plan to let their bill sit over the coming weeks to receive feedback on it and enable it to undergo changes in the House Ways and Means Committee.
The House will likely consider the bill in early June at the earliest, DeLeo said, adding that he hopes to have a bill "signed and sealed" this summer before the Legislature breaks for campaign season.
During a briefing on the bill, DeLeo said he believes the House and Senate will reach agreement on a final bill by July although he said he had no idea, other than what he'd read in media reports, about the Senate's plans.
"I'm really not sure what they're going to provide for Wednesday," he said, referring to Senate leaders' plan to outline their own payment reform proposal this week.
While the state leads the nation in health insurance access and coverage rates, DeLeo said, it's also the leader in health care costs and the bill is designed to dramatically slow cost increases.
DeLeo called the bill a "very thoughtful solution to a very complex problem" and asserted it reflects the input received from patients, consumer groups and health care payers and providers.
Aside from the macro savings, the bill's authors say its passage would cause family premiums, estimated at $15,000 a year for a family of four, to fall by nearly $2,000 a year compared to forecasts, in the next five years.
Health Care Financing Committee Co-chairman Rep. Steven Walsh, D-Lynn, said the bill would hasten progress the industry has been making toward more coordinated care.
The bill also comes amid broader changes in the health care landscape, including the final closing on an affiliation agreement last week that effectively merges Beverly-based Northeast Health System — and its Addison Gilbert Hospital of Gloucester — with the Lahey Clinic under the new corporate umbrella of Lahey Health System.
Walsh said that the House bill features "less government intervention" than the plan offered by Gov. Patrick in February 2011. Walsh said "the threat of government" had pushed the industry to adopt some of the reforms outlined in the bill since Patrick offered his plan. "I think had the governor had an opportunity to have a re-do, I think he would be closer to this approach," Walsh said.
The only aspect of the bill that approaches the idea of rate regulation is a surcharge on health care providers who are unable to justify costs that are 20 percent above median service costs, Walsh said. That provision of the bill would require such providers to make their case before an overhauled Division of Care and Quality, the potential successor agency to the Division of Health Care Finance and Policy.
Other key provisions in the bill:
Requiring interoperable medical records by 2017, making the state the first in the nation to achieve that. Walsh said the records requirement would guard consumer privacy while giving patients and their caregivers, regardless of location, access to their own medical records.
Requiring disclosure to patients of the costs, quality and risks of their care. The bill would also provide to consumers detailed cost and quality information by medical procedure, individual provider and payer. Walsh said the disclosures might show, for example, that the cost of care at a particular community hospital is lower and the care better than at another facility.
Medical malpractice reforms based on a University of Michigan Disclosure, Apology and Offer model that has reduced trials that average seven years. The plan is aimed at encouraging early settlements and allowing providers to be able to freely offer apologies to patients without the fear of litigation. The bill includes a 180-day cooling off period when injured patients would provide a notice of their intent to sue while both sides exchange information and begin to negotiate a settlement. The bill also raises the cap on damages for non-profit hospitals from $25,000 to $100,000 and sets an accountable care organization cap of $500,000.
The bill also calls for increasing MassHealth rates paid to providers, greater rate stability, and authorizes a phased transition to alternative care organizations and patient-centered medical homes with the goal of 80 percent of enrollees participating in such organizations by Jan. 1, 2015.