The Massachusetts Paradox

It's not much of a puzzle.  Massachusetts has relatively low utilization.  But our overall costs are among the highest in the nation.   What we have is very high cost per unit of care delivered in Massachusetts. 

The Boston Globe published the third part of its series on Partners Health Care yesterday, and fixes the blame on a "gentleman's agreement" between Partners, the parent company of Massachusetts General Hospital and Brigham and Women's Hospital, and Blue Cross Blue Shield of Massachusetts, which has a large share of the Massachusetts insurance market.   The Globe reports that in 2000 the CEOs (since retired) of each organization agreed to a large pay increase, contingent upon Partners obtaining similar arrangements from BCBSMA's competitors.   

This graphic shows relative rate of various surgical procedures in Massachusetts compared to the rest of the United States.  Massachusetts has lower than average utilization for most of these procedures.  This data is from the Dartmouth Atlas, which is based on Medicare utilization by state.  Utilization and cost in the Medicare program is not necessarily equivalent to total utilization and cost for all state residents.  

The Partners response to the Globe article is here
There is not a response posted on the BCBSMA website as of now.