Almost six years into a system overhaul, physicians share views on Massachusetts health reform and consider what it means for physicians nationally
By John Carruthers, staff writer, March 01, 2012
The upcoming presidential election has captured the nation’s attention, and at the very center of the maelstrom are the issues of health system reform and extending coverage to the uninsured. As Americans prepare for an election season full of heated rhetoric and important decisions, a pair of Massachusetts dermatologists and the director of their state’s dermatology society say that while the ultimate result of reform is still very much up for debate, there are a number of measurable effects from their state’s push toward reform — which laid the groundwork for the federal effort — that may offer a window into the next decade of medicine.
2006 saw the culmination of Massachusetts Gov. Mitt Romney’s efforts to push forward comprehensive health system reform in his state. The law mandated that residents obtain a minimum level of health insurance coverage, and provided for completely subsidized insurance for residents at or below 150 percent of the federal poverty level and partially subsidized insurance for those earning up to 300 percent of the poverty level. In doing so, the state created an independent authority to connect residents with health plans for which they qualified, known as Massachusetts Health Connector. Individuals who didn’t comply with the mandate faced financial penalties. Businesses with at least 11 employees were required to make what the law termed a “fair and reasonable” contribution toward employee health coverage.
The individual mandate, according to Massachusetts dermatologist Louis Kuchnir, MD, has led to a fairly significant change in culture among health care patients in the state, which he said may partly explain the extremely low number of uninsured patients currently reported. The effect has been particularly clear to Dr. Kuchnir, who runs three practice locations and employs 24 employees, including six physicians and two nurse practitioners.[pagebreak]
“One of the most apparent early effects of the reform was that people who had no insurance became self-conscious about it,” Dr. Kuchnir said. “They were a bit embarrassed because they were supposed to go online and get themselves covered through the Massachusetts Health Connector. They no longer viewed their lack of coverage as someone else’s fault.”
Patient and staff experience
Concerns about universal coverage often focus on the possibility that doctors’ offices will be overwhelmed with patients, but Dr. Kuchnir said that to date, market forces have kept demand reasonably in check, considering the circumstances. A late-2009 survey by the New England Journal of Medicine bears out many of Dr. Kuchnir’s observations, with some physicians reporting longer waits, but an overall improvement in care for Massachusetts residents (see sidebar, page 29, for more information).
“Copayments have gotten so high that demand has been offset. They’ve increased substantially, as have deductibles,” Dr. Kuchnir said. “There is now a proliferation of very low-reimbursing plans that are available to folks who qualify by needs testing.”
As business owners, both Dr. Kuchnir and Pamela Weinfeld, MD, a Wellesley, Mass., dermatologist who runs her own small practice with a partner, have found that the individual mandate has affected them very little, if at all. Both physicians currently offer health benefits to their employees. Dr. Kuchnir said that since the requirements were much more modest than the benefits he already offered his employees, he’s made no changes in his practice’s employee health plan. Dr. Weinfeld, who has only offered employee health benefits for two-and-a-half years, said that while having employees sign up for coverage individually through the Health Connector was extremely easy, offering coverage to her office didn’t require much extra work. While the additional cost of providing insurance to employees is certainly a factor, she said, employers who elect not to provide health coverage to their employees must still provide what the state deems a “fair and reasonable” contribution toward coverage for their employees, with compliance monitored quarterly. Alternately, businesses can be asked to pay up to $295 per employee per year into the state’s Safety Net Trust Fund.
“In some ways, the mandate has made things easier for all practitioners. Before we offered insurance, it was a little easier for people to go and find it themselves on the Massachusetts Health Connector,” she said. “Since we’ve been offering insurance, it’s convenient in a different way. When we didn’t offer it, we had to make sure each employee had insurance individually. Now that we offer insurance, we have it covered, and for those who decline, we have to make them sign a document that they have insurance elsewhere.”
Following implementation of the legislation, the number of uninsured citizens in the state dropped dramatically, and currently resides in the low single digits, according to the state’s Division of Health Care Finance and Policy. This, according to Dr. Weinfeld, has been apparent in her day-to-day, and is one change that she says the majority of doctors find positive. It does, however, require practitioners to review their policies regarding various insurance providers.
“I think that in terms of being a provider, you don’t have a lot of situations where people don’t have insurance. But you do have situations where people have insurance that doesn’t pay very much and you have to decide whether you’re going to take it or not,” Dr. Weinfeld said. “Most of the teaching hospitals and academic centers accept all the different insurances, and it can be a difficult decision whether or not to accept every insurance or only some of the plans.” The lesson for doctors nationwide, about to encounter a similar growth in the number of patients with insurance of varying quality, may be to brush up on their contract-reading skills and rethink the right payer mix for their practices.[pagebreak]
Consolidation and private practice
As might be expected with this first-of-its-kind overhaul, the landscape of medicine in the state has seen significant changes in a relatively short period of time. According to Massachusetts Academy of Dermatology executive director Paul Wetzel, three main insurers — Blue Cross Blue Shield (BCBS), Tufts, and Harvard Pilgrim — insure around 90 percent of patients. The small handful of major insurance providers, he said, is one of the initial factors that contributed to the state’s unique ability to lead the nation in health coverage reform.
The full implementation of a national plan, he said, would likely lead to similar state health insurance consolidation on a nationwide level. At the same time, Wetzel noted, hospitals like Beth Israel and Massachusetts General are expanding throughout the state, making inroads into communities traditionally served by private practitioners and community hospitals.
So far, he said, the results in Massachusetts have some physicians watching the situation with a careful eye. Hospital consolidations in the state, he said, have recently ramped up at an alarming rate, and a significant amount of both provider and insurer activity is concentrated between a handful of organizations.
“BCBS made a contract that would pay Partners doctors [physicians at the multi-hospital organization begun by Massachusetts General Hospital and Brigham and Women’s Hospital] well above and beyond what they would offer to the local community-based doctors. The state attorney general is now looking at that as a potential anti-trust violation,” Wetzel said. “At a time when everyone is worried about the rapidly growing cost of care, [and] one major insurer teams up with one of the major providers and agrees to pay them a lot more than they do the local physicians,” he said, it raises red flags.
“Dermatologists [around the country] don’t really operate in the hospital system sphere nearly as much — they’re very different than a lot of their specialist colleagues in that regard,” Wetzel said. “But the way medicine has traditionally worked is that a physician can open an office and practice medicine the way they see fit. One of the health plans in Massachusetts is now experimenting with reimbursing the patient if they research and find a cheaper option for treatment. It’s already begun with tests — lab tests and MRIs, for example. If a doctor says a patient has to have blood drawn, the patient is in a position to say how much will that cost?’ Then the patient can call around to different labs and find out that they can get it cheaper over at Laboratory X,” he said. “If they use that option and affect a certain reduction, the plan will send them reimbursement.” The result is doctors receiving results from a lab they have no relationship with, he said, a particular concern for dermatologists who value the relationship they have with the dermatopathologist they prefer to work with. “It all boils down to losing control of one aspect of the treatment of the patient,” he said.
Conversely, Dr. Weinfeld said, the growing power of hospital systems in the state has led to a number of immediate benefits for physicians.
“So far I’ve seen a number of positive benefits. I’m in a couple of different health care systems, and one has a really strong unified medical record, which is really incredible for coordinating care,” she said. “When the patient comes in, I can see every single note that their doctors in the system have entered, even though we’re not in the same practice structure. We’re able to access this system and coordinate care. The only concern is when an entity gets that powerful, what will it mean for the future? So I think that there’s a lot of uncertainty in Massachusetts, and people are a bit nervous about that concept.”
Under the nationwide health system reform law, it appears clear that consolidation of care organizations — already a concern for many community hospitals and small practitioners — may accelerate to a pace comparable to that of the Bay State. Like their Masschusetts brethren, though, doctors nationwide may see significant benefits in terms of both medical record integration and coordination of care.[pagebreak]
While significant progress has been made in expanding insurance coverage, Wetzel pointed out that the all-important second phase of the state’s health reform effort — controlling costs — is still in development. Gov. Romney’s roadmap, he said, always included getting the majority of the state insured during the first push, then focusing on cost controls and efficient delivery of care. (In contrast, the national health reform law included both insurance expansion and cost-control experiments.) The development of cost controls in Massachusetts, he said, is something dermatologists and other specialists will watch extremely closely.
“That program only works currently because about half the cost of it has been subsidized by the federal government since it was enacted,” Wetzel said. “The most common expression that you’ll hear about it — especially with the campaign going on and Gov. Romney talking about it and everyone else talking about him — is that it wouldn’t work nationally, or couldn’t, unless the federal government would subsidize half the cost in every state. While it appears to be working, the cost of it has been a bit masked.”
In the last year, though, discussion about cost control has started in the legislature. “Most of the conversation involves the primary care part of the deal. The specialists, including derms, often aren’t even mentioned or discussed,” he said. “The current governor [Deval Patrick] has said that the foundation of any kind of cost control would be a global fee. That’s probably the most significant part. When they talk about a global fee for someone who goes to a primary care doc with a chest cold and then gets farmed out to pulmonary treatment for emphysema, that’s one thing, but derms are another. More than half of their business isn’t through referrals. The question is whether they have to join a group. We’ve had discussions about whether our [Massachusetts Academy of Dermatology] could potentially form an ACO.”
However Massachusetts resolves its cost-control problems, Dr. Weinfeld said, is sure to have a sizable impact on the national discussion. Much of what’s been on the table, she said, is already present with slightly different vocabulary in other states.
“This isn’t all reform per se, but the way health care is structured in Massachusetts with hospital systems and insurers playing a big role will illustrate how national reform is handled,” Dr. Weinfeld said. “The rest of the country will see this soon in the form of ACOs.” (See article, "ACO participation," for discussion of how ACO development may affect dermatologists.)
The X factor in this entire discussion, Dr. Kuchnir said, is politics. While the national health reform law and the Massachusetts plan share a number of logistical similarities except an increased focus on cost control from the inception of the national plan — party divides and process throw them into stark contrast.
“The Massachusetts plan was the initiative of a Republican governor who was working with strongly Democratic majorities in both houses of the legislature. It was bipartisan from its inception through the hearings and discussions in its adoption,” Dr. Kuchnir said. “By contrast, the national plan was passed without a single Republican vote and no Republican support. It was a vision for universal coverage conceived and passed without any bipartisan compromises. As a result, the national experience is likely to develop in a different way than the Massachusetts experience.”
Following the implementation of reform in Massachusetts, the New England Journal of Medicine conducted a poll in 2009 surveying the state’s physicians about their position on the results of reform. They measured physician thoughts on overall support.