Financial Woes and Contract Disputes Disrupt Market

Publication Date: January 2001

Publisher: Center for Studying Health System Change

Author(s): Kelly Devers; Jon B. Christianson; Laurie E. Felland; Suzanne Felt-Lisk

Research Area: Health

Type: Report

Coverage: Massachusetts

Abstract:

In February 2001, a team of researchers visited Boston, Mass., to study that community's health care system, how it is changing and the effects of those changes on consumers. The Center for Studying Health System Change (HSC), as part of the Community Tracking Study, interviewed more than 95 leaders in the health care market. Boston is one of the 12 communities tracked by HSC every two years through site visits and surveys. Individual community reports are published for each round of site visits. The first two site visits to Boston, in 1996 and 1998, provided baseline and initial trend information against which changes are tracked. The Boston market includes the city of Boston and Bristol, Essex, Middlesex, Norfolk, Plymouth and Suffolk counties.

After a period of relative stability, Boston's health care market was disrupted over the past two years by financial difficulties in the plan and hospital sectors and contentious contract disputes between the largest care system and local plans. Policy makers rapidly enacted legislation to stabilize the market and took action to ensure consumers' access to health care.

In the interest of helping local, not-for-profit plans regain their financial footing, employers accepted double-digit premium increases. Consumers continued to enjoy relatively rich benefits but faced higher copayments for prescription drugs and outpatient services. Other important developments include: