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Issue Position: Health Care Unit

Issue Position

Location: Unknown

Health Care Unit Would Reap Significant Savings

The State Auditor audits state spending to ensure that funds are being spent legally but also to be sure that we aren't wasting scarce resources through, for example, inefficient systems, ineffective administration of programs, and redundancy. The State Auditor can and should be a catalyst for accountability in how government spends our tax dollars. I intend to expand on the important work that has been done by the Auditor's office in reviewing Massachusetts' health care spending and to be that catalyst for accountability and results.

In Fiscal Year 2011, Massachusetts will spend over $13.5 billion of the state budget (or 42%) on health care-related spending. It pays for Massachusetts' Medicaid program, known as MassHealth, the Commonwealth Care Program, which provides health insurance to uninsured individuals, the Medical Assistance Trust Fund and state employee health insurance. By establishing a unit within the auditor's office dedicated solely to ferreting out fraud, waste and inefficiencies in the state's health care programs, I will help taxpayers get a better return on their tax dollars and improve access to health care.

Here are some ways the State Auditor has already helped to control costs:

* A 1991 local mandate report recommended legal changes which resulted in cities and towns receiving an additional $50 million/year in federal reimbursements for the municipal Medicaid program. In 2004, the Auditor's office found another $50 million/year that cities and towns were leaving on the table.
* A 2006 audit of MassHealth found $12 million in overpayments and potential annual savings and more importantly, deficiencies in program management, including an alarming lack of resources dedicated to fiscal oversight. Those findings are just the tip of the iceberg.

Creation of the Health Care Unit

The Auditor's office currently has two specialized units that, in part, examine spending related to health care: the Bureau of Special Investigations, which focuses on recipient fraud, and the Medicaid Audit Unit. In the course of their work, both units discover flaws in the design and administration of our health care delivery systems, and they can and do offer recommendations to the agencies for systemic improvement.

I intend to build upon the current capacities of the Medicaid Audit Unit by adding the expertise of professionals with specialized knowledge and practice in health care administration and finance. I will house these experts within a health care unit of the Auditor's office and charge them with responsibility for analyzing larger-scale system dynamics.

The unit will work with other units within the Auditor's office and coordinate with the Auditor's representative on the Health Care Quality and Cost Council (HCQCC), which has wide latitude to recommend changes to the healthcare system.

One of the first jobs of the Health Care Unit will be to comprehensively review health care spending. Its mission: find ways to simplify the way we run the various health care programs, consolidate administration where appropriate and streamline the system to make it easier for consumers to obtain services. The unit will evaluate and, where appropriate, expand upon recommendations from others, such as those in a recent report of the Massachusetts Inspector General. That report recommends that the state explore using the combined bargaining power of all state purchasers in the healthcare field, including the Massachusetts Health Connector, MassHealth, the Medical Security Program, Health Safety Net, and the Group Insurance Commission, when bargaining with providers and insurers. It also suggests that administrative efficiencies would result from streamlined purchasing procedures. The Attorney General's office also issued a report in 2010 that found that the bargaining power of providers relative to insurers is the biggest source of increases in healthcare costs.

The auditor's office can also audit the performance of the agencies that administer these programs and the contractors who are paid by the state to deliver services. The Health Care Audit Unit, working with other units in the office, will prioritize performance audits to be sure that we are getting what we pay for from our agencies and contractors. I will make our findings and recommendations available and easy to access so that Massachusetts taxpayers, residents and others can make informed judgments about how well government agencies and contractors are performing.

As Secretary of Labor and Workforce Development, I oversaw the Medical Security Program, which provides health insurance to individuals who are receiving unemployment assistance. I led a group within the administration to evaluate the value of and challenges to consolidating the administration of the three of the programs that provide health insurance to Massachusetts residents: the Medical Security Program, Commonwealth Care and MassHealth which provides health care to low-income individuals and families. As State Auditor, I will continue to take a leadership role in state government, using the findings from our audits, and working with my counterparts in others parts of government.

I will bring the same leadership, accountability and results to all of my work as State Auditor as I have throughout my career in state government and in the private sector in order to help make government work better for the taxpayers and residents of Massachusetts. Massachusetts led the nation in covering the uninsured. It is time that we lead the nation in finding ways to reduce costs in the system and save money.

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