We have two topics to report on this week: The growing crisis that is healthcare affordability; and an update on efforts to bring legislation repealing the Social Security WEP & GPO laws to a vote in the US Senate.
As we mentioned in the subject line of this email, there is a healthcare affordability crisis looming that will likely cause great harm to a growing number of retirees, active employees, and employers – if the underlying causes are not addressed.Rising healthcare costs continue to drive up insurance premiums, copayments, and deductibles for everyone.
Members are likely aware that our Association has publicly sounded the alarm over the past two years regarding our concerns over rising cost. Insurance providers Blue Cross Blue Shield of MA, Point32 (Harvard Pilgrim and Tufts), and Wellpoint have become increasingly vocal of their deep and growing concerns. And state agencies, such as the Group Insurance Commission (GIC) and Health Policy Commission (HPC) have very publicly gone on record sounding the same alarm and calling for systematic change to gain control over rising prices without cost shifting or degrading the quality of benefits.
The culprit behind increased costs is not higher utilization or even an aging population that requires healthcare services. By all accounts, what is driving costs ever higher are two main factors: the price of prescription drugs and higher prices being charged by hospitals and doctors for medical services.As you likely know, the United States is the only western country that does not regulate the price of prescription drugs. However, as we have previously reported in The Voice, this has begun to change with Medicare now legally allowed to negotiate the price of a select number of prescription drugs. But the overall lack of controls over pricing leaves cost increases solely in the hands of the free market and results in higher insurance costs.
We should point out that rising healthcare costs and concern over affordability are not issues unique to Massachusetts. At the Public Sector Healthcare Roundtable Conference earlier this month, which Nancy McGovern and I attended, cost and affordability were central themes. Plans across the country are working to address the same challenges, with varying results.
However, healthcare costs here in Massachusetts tend to run higher than most of the rest of the country. And with roughly 1/3rd of the Commonwealth’s economy directly tied to healthcare, tackling the underlying cost drivers has proven to be difficult in the past.
On Thursday morning, both the GIC and the BCBS Labor Advisory Committee held meetings. Nancy attended the BCBS meeting, while I focused on the GIC. Interestingly, but not surprising, both meetings focused on the same general theme of efficient innovative care, cost containment, and affordability.
Blue Cross, whose President and CEO Sarah Iselin testified at the HPC Cost Trends hearing earlier this week, has taken a very proactive stance on addressing cost and affordability. In addition to focusing on Massachusetts, The Blue’s offered a national perspective at the Labor Meeting.
BCBS National Labor Organization Executive Director Merrilee Logue and Elana Margolis, Senior Director of Government and Regulatory Affairs at BCBS of MA, each spoke to the national outlook for healthcare cost containment. The BCBS Association and NLO teams were also a featured speaker and participant at the Roundtable Conference in Washington, DC.
At the GIC’s monthly meeting, Executive Director Matt Veno offered a stark overview of the GIC’s concern over rising costs and affordability. Thursday’s meeting marked the official public start to the GIC’s plan design and rate setting process for FY26.
For the 3rd consecutive year, HPC Executive Director David Seltz made a detailed presentation to the 17-GIC Commissioners on the HPC’s annual Cost Trends reportand outlook. Like Veno and BCBS’s Iselin, Seltz offered not only a direct warning regarding rising costs and the impact on our state, but also offered a call to action for need for the government and stakeholder groups to come together in addressing the growing problem.
“This is a civic problem that is impacting all of us, as it is threatening something that we all care about – that is our healthcare system here in Massachusetts. The path we are on, as I see it, is not sustainable,” said Seltz in answering a direct question from GIC Commissioner Eileen McAnneny on his view on who should take the policy lead in addressing the growing crisis. “When I see statistics that 40% of people are not getting the care they need because of the cost of care, in the highest income state in the country…that is a failure.”
Mass Retirees agrees with Seltz’s view that healthcare costs are a civic problem that must be tackled collectively by a broad coalition of stakeholder groups, as well as government officials. We will continue to not only voice our concerns, but also work toward finding and implementing solutions – solutions that do not simply end with our members being forced to pay more for less.
To that end, our members can expect to see the Association taking a more proactive role in influencing overall healthcare policy. One example is a recent opinion piece submitted to Commonwealth Magazine advocating for a change in federal law to provide for fair and neutral billing practices by medical providers, along with greater transparency. Once the article is published, we will be sure to share it with our members.
While rising costs and the acknowledgment of an affordability crisis is startling news, the important thing is that the reality of the situation has been publicly embraced. We will keep members well informed as to what steps are being discussed to address the problem and what any changes might mean to you.
The next GIC meeting will take place on Thursday, December 19th, at which time preliminary plan costs for FY26 will be discussed. And remember, the decisions and policies implemented by the GIC not only impact State retirees and others enrolled in the GIC plans but can also very quickly become local policy as well.
The Latest on the Social Security WEP/GPO
More than a week after the House passed HR82, which fully repeals both the WEP and GPO laws, the issue remains before the US Senate while Senate leaders consider next steps.
To be clear, should full repeal legislation be signed into law, the Social Security benefits of current retirees who have been victimized by WEP/GPO will have their Social Security benefit adjusted to the full amount to which they are eligible for from the effective date of the law forward. The bill currently holds 1/1/2023 as the effective date, but it is subject to change in the legislative process.
We continue to call on all members to contact your local US Senator and urge them to prioritize the passage of HR82/S597 in 2024. Ask them to prevail upon Senate leaders to schedule a vote ASAP.
Together with public retiree organizations and public employee unions from here in Massachusetts, as well as from across the country, we continue to call on Senate Majority Leader Chuck Schumer and Senate Minority Leader Mitch McConnell to bring either HR82 or S597 to the Senate floor for a vote. To date, neither leader has publicly stated their position on the matter, however Schumer is a cosponsor of S597.
Unlike the House, where a discharge petition successfully forced the House Republican Leadership to schedule a vote on HR82, no such parliamentary mechanism exists in the Senate. By intention, the Senate is designed to slow down the legislative process. The decision to place an issue on the calendar rests solely with the Senate leadership. Those Senators objecting to the bill can attempt to block the move using the infamous filibuster, which requires a 60-vote margin to break.
As of today, the official sponsor count of S597 is 61 – a slim margin that must hold, or be expanded, if we are to be successful in passing full repeal of WEP/GPO through the Senate.
In addition to pressuring Senate leaders to act, national advocacy efforts are also focused on those US Senators who are not cosponsors of S597 but represent states with high numbers of retirees impacted by WEP & GPO. These states include Florida, North Carolina, and South Carolina which have a combined 5 Senators who have not signed onto the bill. Florida Senator Rick Scott is a current cosponsor, but Marco Rubio is not.
While we are disappointed that the Senate appears to be entering the Thanksgiving recess without holding a vote on WEP/GPO, we are hopeful that that Senate will choose to quickly act once back in session on December 2nd. That leaves just three working weeks remaining in the Congressional session for 2024, with adjournment now scheduled for December 20th. Should a bill not pass by the time Congress adjourns, current legislation will die and must be refiled to start the process anew in 2025.
Clearly, this is something we very much want to avoid.
I should also mention that this week we have witnessed increased public activity by opponents of full repeal. Charles Blahous, who served as an expert witness at the Congressional hearing on WEP/GPO in April, wrote a lengthy article titled “Congress Should Mend, Not End, Social Security’s WEP and GPO”. Wednesday’s Boston Herald contained a very slanted oped piece by a conservative policy analyst titled “Protecting Social Security from Congress”. We are submitting a rebuttal to the Herald, which they are unlikely to publish – something that is par for the course with the tabloid.
However, both articles tackle similar themes – themes that served as the reasoning used to create WEP/GPO in 1983 and continue to be used by those who oppose full repeal of WEP/GPO.
We will continue to do everything possible to advocate for the passage of either HR82 or S597 in the limited amount of time remaining in the Congressional session.
Watch the video report by clicking here to play.
With great appreciation,
Shawn
Shawn Duhamel
Chief Executive Officer
Mass Retirees Association