Health Care Market Reform Is Advancing – What Does it Mean?

All three branches of government, the Governor’s office, the State Senate and the House of Representatives have all now weighed in with versions of health care marketplace reform.  Even with little time left on the legislative calendar and a state budget to craft, there seems no doubt that something will pass, perhaps quickly and with limited public input beyond what was provided to legislatures in the bill crafting stages.

All of the bills are about market and delivery system reform, with a strong emphasis on health care economics, payment reform at a very global letter and physician practice issues (medical homes, tort reform).  There is very little in either bill about specific sectors beyond hospitals and physicians.  In each bill there are limited mentions of “downstream” providers such as home health, hospice or adult day health.  Workforce training has some prominence in both legislative branch proposals, as does Health IT (with home care a named recipient of possible funds).  WBUR’s Commonhealth blog has a concise summary of the legislative proposals.

Where does this leave the debate and what does it mean for home health? At a very macro level, the Home Care Alliance has been working with a Coalition or providers and insurers on some principles to achieve sustainable reform without enormous disruption.   The Coalition position is that any law must balance the need to reduce costs with a recognition that the health care sector is a key part of the state’s economy and that any measure must not lead to excessive reduction of jobs.

The Coalition is looking to support a bill that:  1) includes a voluntary (rather than mandatory) transition to integrated, globally paid systems; 2) preserves some fee-for-service payment where it makes sense in the market; and 3) includes a reasonable and attainable spending growth target, which the Coalition put at getting total health spending to 1% above the states Potential Gross State Product (PGSP) within three years and to even with  PSGP within five years.  By contrast the House and Senate bills call for a more aggressive glide path for health care spending, with the House looking at limiting growth to one half percent below PSGP.   At a breakfast meeting with the Boston Chamber of Commerce this week,  the governor indicated some support for the Coalition’s spending targets and voluntary transition process.

In terms of home care and hospice, it is clear that all bills envision a more integrated and accountable approach to care delivery.  From what we have seen and heard relative to integration efforts that are already moving  forward (Pioneer ACOs, medical homes),  hospital utilization is targeted to go down and more care will be delivered in the home, both traditional home care/hospice and new chronic,  palliative, and care transitions services.  The goal is to be sure that these services are provided by the entities in this state that have the skills and experience to do it correctly.

However, the message from legislators is that much of what home care and hospice needs to do to ensure this may lie less in legislative language and more in market visibility:  in having confidence in what we do,  in being able to be more nimble pricing, and in demonstrating our effectiveness in reducing health care costs and delivering on quality.

The Alliance is supporting – beyond the Coalition principles above – reform language that would make more specific the language that exists in each bill about including home care services in integrated systems ACOs (Beacon ACOs, as the Senate bill calls them) and assuring our representation on certain governing task forces, such as that which will allocate state IT funds.

At the same time, we are also seeking to protect home cares services in the dual eligible demonstration and have invited Attorney General Martha Coakley’s office to our Annual Meeting to be sure that her efforts at looking the balance or imbalance in market power includes more than hospitals.  We have published and  made available to all provider groups and members a brochure on Home Care Role in a Global Payment Model.

Both our Board and our Legislative Committee are engaged in these efforts, but we need and welcome more member feedback about how we can continue to refine and advocate for a common industry position that assures home care a central role in the next chapter of healthcare reform.

Author: Pat Kelleher

Pat Kelleher is Executive Director of the Home Care Alliance of Massachusetts.

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