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Massachusetts Provider Payment Controls: A Harbinger for the Future?

July 3, 2012 | No Comments
Posted by Frank Ciesla

From a provider’s point of view, the issue of most concern under the Affordable Care Act (the “Act”) is the impact that the law will have on the compensation paid to providers for services rendered to the beneficiaries of either governmental or private insurance programs.  In light of the Supreme Court’s decision last week, there has been a lot of discussion regarding the impact of the Act on insurance companies, taxpayers, and individuals.  However, the financial impact on providers must also be considered.  Without financially stable providers, there is no health care.

A recent article in Modern Healthcare discusses some of the payment challenges that have arisen as a result of the early health care reform program implemented in Massachusetts.  Massachusetts has now come to realize that it must control the costs of health care by controlling payments made to the providers.  There may be different approaches to doing this, but at the end of the day, there will be a negative impact on payments to providers.  As Massachusetts focuses more and more on that issue, we will keep you informed.  Since the Massachusetts approach served as the model for the Affordable Care Act, any cost controls placed on payments to providers in Massachusetts may be a model for the federal program in the future, in its attempt to control the cost of health care.

In our previous blog in March, we discussed the approach taken by the Massachusetts AG to empanel a state grand jury to determine what providers were paid by insurance carriers.  Based on the previously confidential information obtained, the Massachusetts legislature, with the Governor’s support, is now drafting legislation to control payments to providers.  It will be interesting to see what payment controls may be implemented in Massachusetts, and whether similar controls will be required on the federal level.

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