Health Care Laws Directly Impacting Employer Costs
Chapter 58 of the Acts of 2006
An Act Providing Access to Affordable, Quality, Accountable Health Care.
This landmark healthcare reform law created an individual mandate, established the MA Health Care Connector, merged the individual and small group market and expanded access to care for those who could not afford it. It was the precursor to the federal Affordable Care Act
Chapter 224 Of the Acts Of 2012
An Act Improving the Quality of Health Care and Reducing Costs Through Increased Transparency, Efficiency and Innovation.
A companion law to Chapter 58, this law established an annual health cost growth benchmark and created two state agencies: the Health Policy Commission (HPC) whose charge is to moderate the healthcare cost trend in Massachusetts and the Center for Health Care Information and Analysis(CHIA), the agency responsible for providing data and analysis on hospital pricing and other health care cost components.
Chapter 115 of the Acts of 2016
An Act Relative to Equitable Health Care Pricing
This law established a special commission to review the variation in prices among providers, identify the unacceptable contributing factors to the variation and make recommendations on steps to reduce provider price variation and recommend the maximum reasonable adjustment to a commercial insurer’s median rate for individual or groupings of services for each acceptable factor. The commission’s recommendations were not implemented
Chapter 41 of the Acts of 2019
The FY2020 General Appropriation Act
This law provided the executive office of health and human services with the authority to directly negotiate supplemental rebate agreements with drug manufacturers for those drugs covered by (SECTION 46), expanded the scope of HPC’s authority to conduct drug pricing reviews (SECTION 6) and prohibits insurers or other entities from imposing a retroactive claims denial for behavioral health services (SECTION 55).
Chapter 343 of the Acts of 2024
An Act Enhancing the Market Review Process
This law further enhances the powers of the Health Policy Commission. Among these are authority to review and report on pharmaceutical benefit managers, obtain information from equity investors in hospitals, and create a state health resource plan. Licensing requirements for urgent care and office-based surgical centers are introduced. This law also compensates HPC directors and alters the composition of the HPC board to include a hospital and pharmaceutical company while eliminating the employer representative seat.
Legislation Adding Cost to the Commercially Insured
Additional Direct Costs
Lawmakers have enacted 57 mandated health insurance benefits or services that add $2.47 billion to the aggregate cost of premiums annually. Self-insured and government programs are not subject to most of these law, placing the cost on those in the fully insured commercial market.
Among these mandated benefits are coverage for:
- Hearing aids
- Licensed marriage and family therapists
- Oral cancer therapy
- 14 days coverage of inpatient substance use disorder (SUD) services without medical management
- Lyme disease
- HIV associated lipodystrophy syndrome treatment mandate
- Out of Network, PANDA/PANS telehealth
- 12-month supply of contraceptives without cost-sharing
- Abortion mandate, elimination of cost-sharing for abortion and abortion related care
- Mental health wellness exam
- Coverage for disabled dependents mandate
- HIV Prevention Drugs (PreP) Coverage Mandate
Additional Indirect Costs
In addition to the direct cost of care, many fees are imposed by lawmakers onto healthcare providers and health insurers that get passed on to purchasers in the form of higher premiums. $3.1 billion in assessments on payers from 2013–2023
- Assessment on surcharge payers to fund HPC and CHIA
- Assessment on surcharge payers to fund Vaccine Purchase Trust Fund
- Massachusetts Child Psychiatry Access Program (MCPAP) assessment
- Behavioral Health Trust Fund and Behavioral Health Advisory Commission
- Behavioral Health Assessment on Payers
Limits on Care Management
On of the few ways that insurers/employers can control costs is to use care management tools that ensure that the care received is appropriate and cost effective. Lawmakers have imposed restrictions on these tools that add to the cost of care.
Care management tool restrictions include:
- Mandates 14 days coverage of Crisis Stabilization Services without medical management
- Limits health plans and pharmacy benefit managers’ ability to audit pharmacies
- Behavioral Health – elimination of prior authorization for acute inpatient, Community-Based Acute Treatment Services, Intensive Community Based Acute
- Treatment Servies, changes to Office of Patient Protection OPP regulations relative to medical necessity decision.
- Limitations on Retroactive denials
- Limitations on step therapy
