Insurers say premiums likely to rise if Question 1 passes

The day after releasing a study that estimated the costs of a nurse staffing ballot question at up to $949 million, the Health Policy Commission on Thursday offered new information on how those expenses would break down.

The commission’s analysis pegged the cost of Question 1, which sets limits on the number of patients assigned to one nurse, at between $676 million and $949 million, and said the state would need an additional 2,286 to 3,101 full-time equivalent nurses to comply with the proposed mandates.

The Massachusetts Nurses Association, the union backing the ballot question, blasted the findings, calling it “guess on costs” that was “irresponsible and inconsistent.” Julie Pinkham, the association’s executive director, said in a statement last week that the analysis “estimates a cost of $300k per nurse FTE (full-time equivalent), per year” and that the cost estimates did not provide an “independent data source or transparency.”

A Health Policy Commission spokesman last Thursday said the analysis also considered additional costs that were not directly associated with the new nurses that would be required.

“The HPC’s cost impact analysis of nurse staffing ratios estimated the need for to meet the mandate,” HPC press secretary Matt Kitsos said in a statement. “While not a part of our presentation, we can report that the estimated cost for each new nurse is $133,285 to $138,765. This includes both the estimated salary (with an estimated wage increase of 4 percent-6 percent) and the estimated cost of benefits. Our analysis included additional costs not associated with these new RNs, such as costs for acuity tools and wage increase for currently employed RNs in Massachusetts.”

The analysis said higher demand for registered nurses would likely drive up RN earnings between 4 percent and 6 percent over time.

The Massachusetts Association of Health Plans, an insurers group that typically opposes measures it believes would increase health care costs, on Thursday came out against Question 1, citing the commission’s report.

MAHP President Lora Pellegrini said the projected spending increased would “likely result in increased premiums for employers and consumers, and based on these findings, will threaten our state’s ability to meet the health care cost growth benchmark.”

A 2012 cost control law, which created the Health Policy Commission, also calls for the state’s annual health care spending growth to be measured against a benchmark, currently set at 3.1 percent.

The estimated costs if Question 1 passes would represent 1.1 percent to 1.6 percent of total health expenditures, the commission found.
The health plans association on Sept. 19 wrote to the Health Policy Commission, asking for an independent analysis on the ballot question.
The HPC on Aug. 14 hired consultant Joanne Spetz, a University of California-San Francisco professor, to work on the analysis, but did not publicly announce the review until Sept. 24. In June, the News Service inquired about the potential for a HPC analysis. An agency spokesperson said at the time that the commission had not conducted a review and would have no further comment, but planned to offer an update if anything changed.

“We didn’t want to make a big deal. It wasn’t designed to keep it a secret,” Health Policy Commission Chairman Stuart Altman told reporters after the findings were presented Thursday.

Question 1 supporters filed a public records request seeking information about how the analysis originated, and have questioned the commission’s decision to get involved in the issue, as the HPC would be required to create regulations related to the question if it passes.

Altman described the dynamic around analyzing a ballot question as “tricky,” noting the commission was “not charged with directing how people vote.”