Massachusetts Commission Recommends Price Controls for Hospitals, Other Providers

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A Massachusetts commission responsible for controlling health care costs in that state has issued a recommendation that price controls be imposed on hospitals and other medical providers, State House News Service ( www.statehousenews.com) reports.

The commission suggests that hospitals be required to justify health care prices that appear to fall above the norm, and that they do so before a panel of state healthcare finance officials if insurers refuse to pay them.
The latter would then be forced by the panel to accept the price quoted by the hospital in question, or the panel would require the hospital to take a lower price.

The recommendation passed 9-1. Lynn Nicholas, president and CEO of the Massachusetts Hospital Association, reportedly voted against it, based on the belief that such an "extreme and administratively burdensome step" would yield the government power over the private healthcare sector that it "cannot exercise effectively or fairly."

Meanwhile, according to the State House News Service report, the insurance industry perceives the recommendation as an “implicit acknowledgment “that caps on insurance rates have not been effective in reducing health care costs. Massachusetts’ insurance rate review powers rank among the strongest in the U.S., with Gov. Deval Patrick's administration last year rejecting almost nine out of 10 rate increase requests.