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IT’S MARCH, so that means it is time for the men’s and women’s NCAA basketball tournament and all of the suspense, surprise, and excitement connected to it.

But March also brings us the 7th annual Massachusetts Health Policy Commission health care cost growth benchmark hearing—scheduled this year for March 15.  Though prior hearings have lacked any “buzzer beater” moments, I am holding out this year for a scintilla of surprise. I want to see if the lawmakers from the Joint Health Care Financing Committee – including co-chairs Sen. Cindy Friedman of Arlington and Rep. John Lawn of Watertown — will signal some real interest in wanting to pass some key fixes to the state’s cost containment law as it relates to the accountability scheme tied to the health care cost benchmark.

Technically, the purpose of the benchmark hearing is for the agency’s commissioners to hear some presentations of key data and stakeholder testimony to help decide if they should recommend in 2024 any modification to the proposed 3.6 percent benchmark that is tied to the state’s long-term economic growth rate.

That projected growth rate number has remained constant ever since the Health Policy Commission came into existence in 2013. From 2018 to 2022, the law mandated that the benchmark would be 0.5 percent less than the predicted long term growth rate—or 3.1 percent.   During that period, the commission could recommend a modification to the benchmark—but was limited to only a level somewhere between 3.1 percent and 3.6 percent.   The commission never budged from 3.1 percent during any of those years.

Starting last year, the HPC Board was free to recommend any target level that it deems reasonable—subject to legislative review.  No change was made last year, and no change is expected this year.

Ever since the initial 2020 pandemic year yielded a measure of -2.4 percent for the state’s per capita change in total health care expenditures, Massachusetts has entered a strange and frustrating era where the benchmark now has little relevance for comparison purposes to a provider’s or insurer’s measured health care spending performance.

In 2020, there was a reduction in care utilization during COVID, which drove down spending. And in 2021, a return closer to normalcy likely pushed spending growth well above the 3.1 percent benchmark. Commission officials predict it will likely be above 10 percent. With inflation surging in 2022 (medical inflation in the Boston area was 6.1 percent for the year ending January 30), the number will remain quite high, perhaps between 5 percent and 10 percent. The outlook for 2023 and 2024 is not much different.

So to spend time at this week’s hearing talking about whether to tinker with the 3.6 percent cost growth target for 2024 seems like a waste of time in light of these realities. So what should be the focus?

The focus should be on developing legislation strengthening the Health Policy Commission’s ability to truly advance accountability in the “against benchmark performance” oversight process.  Here’s my recommendations:

Better expense information: There is a glaring need for a legislative mandate for detailed reporting of provider expense information to the state’s Center for Health Information and Analysis. The data would be useful in considering additional bailouts of hospitals or future performance improvement plan mandates. Commission member David Cutler raised this issue at the commisssion’s December board meeting and I wrote about it here.

Broaden reach of performace improvement plans: One of the areas prioritized among all recommendations in the Health Policy Commission’s 2022 cost trends report was passage of a new law that would strengthen accountability for above-benchmark spending growth through use of improved and additional metrics and inclusion of entities other than primary care physician groups that can directly be placed under performance improvement plan jurisdiction.   Most important is the inclusion of hospitals and health systems as directly accountable for attributable spending growth through their pricing, coding practices, or other actions that lead to unjustified commercial spending growth for Massachusetts patients. The commisson’s performance improvement plan process needs to be able to deal with this challenge directly and not only indirectly, so that hospitals such as Boston Children’s and Dana-Farber, which are essentially immune right now from the performance improvement plan process, can be held to account for their high prices that contribute to health care affordability challenges in our state.

More significant penalties tied to spending burdens from all commercial patients: The commission should have the power to assess much more significant financial penalties when a provider fails to take adequate steps to address out-of-control spending growth. The current penalty is no more than $500,000 for noncompliance or inadequate compliance with performance improvement plans, but it should go as high as the total excess spending burden that results from pricing and care practices for all of their commercial patients—similar to what is now the law in California.

The Health Policy Commission has been calling for these sorts of improvements in its annual recommendations now for over two years. Let’s use this year’s benchmark hearing to focus discussion on how to improve the commission’s ability to use the performance improvement plan process to bring discipline to out-of-control spending behavior. With the Joint Health Care Finance Committee members in attendance, I think there is real opportunity to get the legislative ball rolling in a value adding way.

Paul A. Hattis is a fellow at the Lown Institute.