Thursday, December 20, 2007

Massachusetts Plan Squeezing Doctors

The December 14, 2007 Boston Globe reports that much ballyhooed Massachusetts universal health care plan is costing too much, so doctors and patients will have to pay the price. Items in bold are my emphasis:
Mass. panel approves changes to subsidized residents health plan
By Alice Dembner

Striving to hold down costs to taxpayers, a state panel yesterday approved a range of changes for next year for the rapidly growing subsidized health insurance program. The changes will probably cut payments to doctors and hospitals, reduce choices for patients, and possibly increase how much patients have to pay.

The program is the centerpiece of the state's landmark effort to insure nearly every resident, and there is widespread concern about long-term funding of the initiative because of growing healthcare costs.
The December 14, 2007 Wall Street Journal points out the natural implications:
Mass. To Cut Payments to Docs & Hospitals
Posted by Jacob Goldstein

Massachusetts’s universal health-care plan is turning out to be more expensive than predicted. Now the state is looking at cutting payments to docs and hospitals next year to make ends meet.

That fiscal reaction, which some critics of the plan warned about, sends a stark message to those of us in the other 49 states. Massachusetts has become something of a model for the national plans proposed by Hillary Clinton and John Edwards, among others.

The state requires everybody to buy health insurance. A subsidized health plan offered to the poor as part of the program has proved more popular than expected, and that’s helping to push costs 20% over what the state had budgeted. The tab could run $619 million for the current fiscal year, $147 million over budget, the Boston Globe reports.

Now the board that oversees the plans has approved cuts of 3% to 5% in reimbursements for to health-care providers caring for those in the subsidized plan. The article suggests the cuts will bring reimbursement in line with Medicaid.
The next logical step after price controls will be rationing. The Massachusetts plan is fundamentally flawed, because it does not permit individuals and insurers to seek their own best interests through voluntary contract. There's no reason for Colorado (or the rest of the country) to adopt this bad idea.