News & Events

Seeds of worry for health overhaul

If Mass. is indicator, cost of care could be concern in US plan

By Robert Weisman and Kay Lazar, Globe Staff  |  December 25, 2009

It was a scene that David Himmelstein, a primary care physician at Cambridge Hospital, has seen frequently. Before he had a chance to treat his scheduled patient yesterday morning, the man left the reception area, having decided at the last minute that he could not afford medical care.

“He was worried he would be hit with charges that his insurer would refuse to pay,’’ Himmelstein said.

The aborted appointment illustrates what many who work in the Massachusetts health care industry say is a major flaw in the 2006 state health reform law, widely considered a template for the work now going on in Washington, D.C. The state extended health insurance to 97 percent of residents, but those in the medical and insurance industries here say the legislation did not do enough to make care affordable for everyone. And they worry that the national health bill passed early yesterday by the US Senate similarly fails to tackle rising costs.

“Providing more access to larger numbers of people is certainly a good thing, so I think the Senate bill is a step in the right direction,’’ said Rick Lopez, chief physician executive at Atrius Health, a Newton-based alliance of five eastern Massachusetts community doctors groups. “But the underlying issue of orchestrating health care in a way that costs are not going to go up, it doesn’t address that.’’

Like Lopez, others yesterday expressed broad support for the national overhaul effort – which will probably have less of an impact here than in other states because of the 2006 law – while wondering who will end up paying for the staggering expense of expanding coverage to millions of people who are now uninsured.

Some, like Paul F. Levy, Beth Israel Deaconess Medical Center’s chief executive, said medical care providers and insurers may be better able to control costs – without reducing the level of care – than the government.

Atrius and Beth Israel Deaconess in Boston, for example, last month widened a partnership aimed at managing costs while maintaining the quality of care. Other hospitals are striking similar deals with doctors groups. And insurers such as Blue Cross and Blue Shield of Massachusetts have rolled out so-called alternative quality plans that pay health care providers annual fixed amounts for patient care rather than fees for individual visits and procedures.

Despite estimates by the Congressional Budget Office that the US health care overhaul will ultimately reduce the national deficit, Levy said, “I haven’t met anyone in the field who thinks the cost estimate is correct. It’s going to be more expensive. I happen to think it’s worth it.’’

In particular, doctors groups have said the Massachusetts overhaul and the federal legislation fail to do enough about a major reason for rising costs – the malpractice system. Currently, they say, doctors are often forced to practice defensive medicine – ordering unnecessary tests and procedures to protect themselves against lawsuits. That makes health care more expensive for everyone.

“This is a system problem, it’s not a people problem,’’ said Ralph de la Torre, chief executive of Caritas Christi Health Care, a network of six Catholic hospitals in Eastern Massachusetts.

For members of health care unions, who have backed a national health care overhaul, the prospect of a federal law moving closer to reality carries the promise of more jobs.

“I’m hoping it will make things better, provide more coverage for more people, and help secure my job and the jobs of other health care workers,’’ said Mike O’Brien, a respiratory therapist at North Adams Regional Hospital and a member of the Service Employees International Union, a supporter of the health bill.

But no matter what the final version looks like, the federal legislation does not mean everyone will get more funding. In fact, as it now stands, payments to hospitals and doctors who have been treating a disproportionate number of low-income and uninsured patients will be scaled back. Some of that money will instead be used to pay for patients’ health insurance coverage.

Physicians and executives of so-called safety net hospitals in Massachusetts say that same kind of strategy has not worked out under the state overhaul. As a result, the hospitals say, they are absorbing millions of dollars in losses.

“We have had tremendous cutbacks here,’’ said Himmelstein. “We are seeing as many patients, but without the funding.’’

Geoffrey S. Young, a neuroradiologist at Brigham and Women’s Hospital, fears that if the federal law reduces reimbursements for such care as crucial imaging procedures, patients could suffer in the name of saving money. “The overarching concern is that the bill doesn’t restrict support for research, teaching, and clinical care,’’ Young said.

In Massachusetts, medical costs are rising by about 10 percent a year. A state-appointed special commission in July recommended slowing that upward trend by paying doctors and other providers a lump sum for each patient – a move Blue Cross has been piloting with about 300,000 of its 3 million patients.

“Five percent of our members account for 50 percent of our health care spending, and most of those are people with multiple chronic illnesses,’’ said Andrew Dreyfus, executive vice president of Blue Cross.

“There is broad consensus that if we could coordinate care for the patients more effectively, we could reduce unnecessary spending and keep people healthier.’’

But Dreyfus added that if insurers are taxed more – as the current version of the national health plans calls for – those added costs will inevitably be passed on to consumers. “There is some concern there,’’ he said.

Robert Weisman can be reached at, Kay Lazar at