Report: Costs Of Massachusetts Reform In Line With Projections, Uncompensated Care Spending Falls

If the effects of Massachusetts health care reform law offer a preview of how Obamacare will transform the country, then a new report from the Massachusetts Taxpayers Foundation has some promising news for the national law. According to the group, annual spending on the state’s Chapter 58 reform has grown modestly — in line with projections — while the state’s near universal coverage rate resulted in a decrease spending on uncompensated care:

Annual spending for programs affected by Chapter 58 grew from $1.041 billion in fiscal 2006 to $1.947 billion in fiscal 2011, an increase of approximately $906 million. The
state’s share of this spending increase is $453 million, or 50 percent of the total. While critics periodically claim that health reform has been a “budget buster,” additional state spending attributable to the health reform law accounted for only 1.4 percent of the Commonwealth’s $32 billion budget in fiscal 2011. Over the five full fiscal years since the law was implemented, the incremental additional state cost per year has averaged $91 million, an amount that is well within projections made prior to the law’s enactment. […]

[A]nnual state spending for uncompensated care dropped by $118 million over the first five years of reform. Annual Health Safety Net (HSN) spending fell by one-third from fiscal 2006 to fiscal 2008, reflecting a more than 50 percent decline in the number of inpatient discharges and outpatient visits for which HSN payments were made during that period.

Massachusetts’ success may provide a template for states implementing the national measure, which includes cost control provisions — like investments in comparative effectiveness research, electronic health records, and delivery system reforms — that will result in greater health savings for the nation. But for now, this report is just another example of the contrast between the doomsday predictions of conservatives and the reality of reform.