The HPC’s Cost Trends Hearing

The state’s Health Policy Commission (HPC) held its annual cost trends hearing last Tuesday and Wednesday, taking a deep dive into the Massachusetts healthcare system and its expenses.
Massachusetts, in the latest available data, matched the state’s cost growth benchmark of 3.1%. Massachusetts has consistently fallen below national per capita growth and the state has not exceeded its spending target since 2015, while continuing to be a national leader in quality.
Other states, including Oregon, Connecticut, and Rhode Island attended the hearings to learn more about the success of the cost growth benchmark, which Massachusetts first implemented in 2012.
Several hospital CEOs told the HPC, which is funded entirely through assessments on hospitals, ambulatory surgical centers, and insurers, that additional cost reduction is their goal and offered to continue collaborations with the HPC to bring about further positive change. Alternative payment contracts, patient medical homes, reducing administrative burdens, shifting patients from academic medical centers to community hospitals within a system are among the many initiatives underway to reform the multi-billion healthcare system, executives said. 
During the two-day hearings, the HPC convened its first ever panel addressing administrative complexity in the healthcare system, noting that for the second year in a row, premium retention grew rapidly for both merged market and larger employer plans in 2018. Insurer administrative costs were the fastest growing category.
The commission is charged annually with identifying challenges the state has in meeting the statutorily set cost growth benchmark and, if it is missed, identifying drivers and solutions for future success.