When 2 in 5 people report delaying health care because of costs, something is wrong
Despite Massachusetts’ reputation as a medical mecca, health care here is becoming increasingly unaffordable. And while the state has taken important steps to rein in increases to the overall cost of care, those savings haven’t always been passed on to the consumer.
This makes it crucial for the Massachusetts Health Policy Commission, together with the Legislature, to establish an affordability benchmark — a new measure that would highlight how much consumers pay for health care, which could be used to hold the health care system accountable for keeping patient costs down.
The state has long struggled to contain its high health care costs, which are passed on to consumers through health insurance premiums and copays. According to the Center for Health Information and Analysis’ 2024 annual report, 41 percent of Massachusetts residents polled in a 2021 survey had trouble affording health care during the prior 12 months, including more than 50 percent of Black and Hispanic respondents. Nearly one-third of residents reported going without needed health care because of cost. A poll conducted in February and March 2024 for Blue Cross Blue Shield of Massachusetts found that 40 percent of respondents reported delaying care because of cost.
Struggles paying for care are unsurprising given the high cost of insurance. The average commercial health plan cost $595 per member per month in 2022, or $7,140 annually, an increase of 5.8 percent from the prior year, according to the CHIA report. The average person with commercial insurance paid another $730 a year in cost-sharing. Because plans are so expensive, more small businesses are offering high-deductible health plans, and 1.7 million Massachusetts residents were enrolled in health plans with deductibles of at least $1,400. Having a high deductible can dissuade people from seeking care since they know they will have to pay out of pocket until the deductible is met.
Between 2020 and 2022, both premiums and cost sharing grew faster than wages or inflation. And these numbers do not include the cost for care obtained outside the insurance system — for example, many mental health clinicians require payment out of pocket.
Massachusetts was the first state to establish a health care cost growth benchmark. The Health Policy Commission, working with the Legislature, sets a target each year for health care cost growth. Providers and insurers have to publicly testify at an annual hearing on how they are keeping costs in line. The commission has authority to require any provider that does not adhere to the benchmark to adopt a performance improvement plan. (Only one plan has ever been negotiated, with Mass General Brigham.)
That benchmark is important and should be expanded. For instance, this editorial board has supported requiring pharmaceutical companies, pharmacy benefit managers, and drug wholesalers to testify about cost drivers related to prescription drugs. The provider review process should be expanded to cover all hospitals and specialty care providers, rather than only those with affiliated primary care physicians.
But a separate affordability benchmark is also necessary because curbing health care costs does not always mean limiting consumer costs, due to the health care system’s complexity. For example, if a drug manufacturer lowers a drug price through a rebate pocketed by a pharmacy benefit manager, the patient still pays the same amount.
“You can get savings sometimes at the system level, and it doesn’t always translate to the direct experience consumers are having,” said Alex Sheff, senior director of policy and government relations for Health Care for All, a health care consumer advocacy group.
That is why a new measure that would monitor spending by patients with commercial insurance — insurance bought through an employer or the state exchange — would be a valuable tool to better understand consumer costs and hold the health care system accountable for containing them. Ideally, this metric could be parsed in a way that helps policy makers understand whether certain populations have bigger cost burdens, like people with disabilities or chronic conditions or people of different races, ethnicities, ages, or income levels.
To be effective, the affordability benchmark must be paired with accountability. The challenge will be developing a fair way to hold the entire system accountable.
The easiest measure of affordability relates to how much consumers are paying for insurance. But insurer profits are already regulated, and the amount insurers charge reflects the prices doctors and drugmakers charge.
David Seltz, executive director of the Health Policy Commission, said the commission is still in the early stages of developing an affordability benchmark, but it is considering different accountability methods, such as including affordability as another factor in the current system of health care cost reviews and performance improvement plans; having the Division of Insurance consider affordability in approving insurance rates; and developing a new system. While the commission can develop the affordability metric on its own, any accountability measure needs legislative approval. Lawmakers should ensure that there is a system with teeth in place to keep consumer costs down, and that it is done in a way that includes providers, insurers, and the pharmaceutical industry.
While no state has done exactly what Massachusetts is considering, other states have addressed health care affordability within broader efforts to contain costs, including Rhode Island, Connecticut, Vermont, and California.
The best way to keep people healthy is to ensure everyone can get the care they need when they need it, without worrying about whether they can afford it.