2022 Cost Trends Report and Policy Recommendations- Published September 2022
This year, Massachusetts marks a milestone anniversary in its ambitious journey of health care reform. In 2012, with a broad consensus to restrain rapidly increasing health care costs, the Commonwealth enacted a comprehensive new law (Chapter 224), the centerpiece of which is the innovative health care cost growth benchmark, a first-in-the-nation, statewide target for sustainable growth in total health care spending (originally 3.6 percent, lowered to 3.1 percent in 2018, and rising again to 3.6 percent in 2023). The law established the Massachusetts Health Policy Commission (HPC) to monitor and guide this ambitious effort.
After the passage of the law, health care spending growth in Massachusetts was below the comparable U.S. rate for most years, accounting for billions in avoided spending for Massachusetts residents. However, by the end of the decade, spending growth was accelerating and above the benchmark from 2017 to 2019. The public health and economic challenges created by the COVID-19 pandemic since 2020 have underscored the importance of the goals Chapter 224 sought to promote – an affordable, accessible, and equitable health care system for all residents of the Commonwealth.
In this annual report, the HPC presents new research to enhance the collective understanding of health care spending trends and cost drivers and evaluates progress in meeting the Commonwealth’s cost containment, care delivery, and payment system goals. 2020 is the first year that health care spending in the Commonwealth has been measured against the benchmark target during the COVID-19 pandemic. Largely as a result of the pandemic, the state’s health care spending per capita decreased 2.4 percent from 2019 to 2020, far below the benchmark of a 3.1 percent increase. Health care spending is widely expected to rise again for 2021 and beyond.
Using the most updated data available, the HPC was able to more fully examine the impact of the COVID-19 pandemic on patterns of care and access in the Commonwealth. Analysis of the disruptions in care resulting from the pandemic – including differential impacts by community income – are a major focus of the 2022 report.
As the Commonwealth navigates the third year of the pandemic – and even as providers are facing significant headwinds with workforce, supply chain, and inflation issues – these findings underscore the urgent need to create a more affordable, equitable, high-quality health care system for all residents.
This year presents an opportunity to reflect on ten years of Massachusetts experience, data, and evidence, to chart a bold path forward for the next decade. To this end, this report includes six policy recommendations that reflect a comprehensive approach to reducing health care cost growth, promote affordability, and advance equity. The HPC stands ready to support these efforts.