Current Events Health Insurance

Rationing comes to Massachusetts

Massachusetts legislature passed a first-in-the-nation bill limits the growth of health care costs in the state.

The bill would not allow spending on health care to grow any faster than the state’s economy through 2017. For five years after that, any rise in health care costs would need to be half a percentage point lower than the increase in the state’s gross domestic product.

How does the bill aim to achieve this goal?

The bill sets up “…a new commission would monitor the growth in health costs and enforce the spending targets. But the bill contains no real penalty for missing the targets, and some consumer advocates are skeptical.”

The bill also dedicates “…$60 million collected from insurers over the next four years to prevention efforts and encouraging the creation of ‘accountable care organizations.'”

Moody’s states that the bill will have a negative effect on hospital credit ratings in Massachusetts.