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HOUSE DOCKET, NO. 1115 FILED ON: 1/14/2025
HOUSE . . . . . . . . . . . . . . . No. 1361
The Commonwealth of Massachusetts
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PRESENTED BY:
Patricia A. Duffy
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To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
Court assembled:
The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:
An Act to address health care costs through the cost benchmark and rate review processes.
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PETITION OF:
NAME:DISTRICT/ADDRESS :DATE ADDED:Patricia A. Duffy5th Hampden1/14/2025James C. Arena-DeRosa8th Middlesex3/12/2025 1 of 4
HOUSE DOCKET, NO. 1115 FILED ON: 1/14/2025
HOUSE . . . . . . . . . . . . . . . No. 1361
By Representative Duffy of Holyoke, a petition (accompanied by bill, House, No. 1361) of
Patricia A. Duffy relative to health care costs. Health Care Financing.
The Commonwealth of Massachusetts
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In the One Hundred and Ninety-Fourth General Court
(2025-2026)
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An Act to address health care costs through the cost benchmark and rate review processes.
Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
of the same, as follows:
1 SECTION 1. Chapter 6D of the General Laws, as so appearing, is hereby amended by
2inserting after subsection (b) of section 10 the following subsection:-
3 (c) The commission may require a performance improvement plan to be filed with the
4commission for a health care entity that is identified by the center under section 18 of chapter
512C.
6 SECTION 2. Chapter 6D of the General Laws, as so appearing, is hereby amended by
7striking out subsection (q) of section 10 and inserting in place thereof the following subsection:-
8 (q) If the commission determines that a health care entity has: (i) willfully neglected to
9file a performance improvement plan with the commission within 45 days as required under
10subsection (d); (ii) failed to file an acceptable performance improvement plan in good faith with
11the commission; (iii) failed to implement the performance improvement plan in good faith; or
12(iv) knowingly failed to provide or falsified information required by this section to the 2 of 4
13commission, the commission may: (A) assess a civil penalty to the health care entity of not more
14than $500,000 for a first violation, not more than $750,000 for a second violation and not more
15than the amount of spending attributable to the health care entity that is in excess of the health
16care cost growth benchmark for a third or subsequent violation; provided, however, that a civil
17penalty assessed pursuant to one of the above clauses shall be a first offense if a previously
18assessed penalty was assessed pursuant to a different clause; (B) stay consideration of any
19material change notice submitted under section 13 of this chapter by the health care entity or any
20affiliates until the commission determines that the health care entity is in compliance with this
21section; and (C) notify the department of public health that the health care entity, if applying for
22a notice of determination of need, is not in compliance with this section. A civil penalty assessed
23under this subsection shall be deposited into the Healthcare Payment Reform Fund established
24under section 100 of chapter 194 of the acts of 2011. Except as otherwise expressly authorized
25under this section, the commission shall seek to promote compliance with this section and shall
26only impose a civil penalty as a last resort.
27 SECTION 3. Chapter 12C of the General Laws, as so appearing, is hereby amended by
28striking out section 18 and inserting in place thereof the following section:-
29 Section 18. (a) For the purposes of this section, “health care entity” shall mean a clinic,
30 hospital, ambulatory surgical center, physician organization, carrier or an accountable
31care organization required to register under section 11.
32 (b) The center shall perform ongoing analysis of data it receives under this chapter to
33identify any health care entity whose: 3 of 4
34 (1) contribution to health care spending levels and growth, including but not limited to,
35spending levels and growth as measured by health status adjusted total medical expense, is
36considered excessive and who threaten the ability of the state to meet the health care cost growth
37benchmark established by the health policy commission under section 9 of chapter 6D; provided,
38that the center shall identify cohorts for similar health care entities and establish differential
39standards for excessive growth rates, based on a health care entity’s baseline spending, pricing
40levels and payer mix; or
41 (2) data is not submitted to the center in a proper, timely or complete manner.
42 (c) The center shall confidentially provide a list of the health care entities to the health
43policy commission such that the commission may pursue further action under section 10 of
44 chapter 6D. Confidential referrals under this section shall not preclude the center from
45using its authority to assess penalties for noncompliance under section 11.
46 SECTION 4. The fifth paragraph of section 4 of chapter 176B of the General Laws, as so
47appearing, is hereby amended by striking out the first sentence and inserting in place thereof the
48following sentences:- Under such a group medical service agreement, subscription certificates
49and the rates charged by the corporation to the subscribers shall be filed with the commissioner
50within thirty days after their effective date. The commissioner shall approve, modify or
51disapprove any proposed changes to rates; provided, however, that the commissioner shall only
52modify or disapprove any proposed changes to rates that are excessive, inadequate or unfairly
53discriminatory; provided, further, that group plan contracts issued and rates charged by a
54nonprofit medical service corporation to its subscribers providing supplemental coverage to
55medicare shall be subject to the provisions of chapter one hundred and seventy-six K if the 4 of 4
56subscribers, and not their employer, employers or representatives, are billed directly for such
57contracts. No classification of risk may be established on the basis of age.
58 SECTION 5. The first paragraph of section 16 of chapter 176G of the General Laws, as
59so appearing, is hereby amended by inserting after the second sentence the following sentence:-
60The commissioner shall approve, modify or disapprove rates; provided, however, that the
61commissioner shall only modify or disapprove rates that are excessive, inadequate or
62unreasonable in relation to the benefits charged.
63 SECTION 6. Subsection (c) of section 6 of chapter 176J of the General Laws, as so
64appearing, is hereby amended by striking out the second sentence and inserting in place thereof
65the following sentence:- The commissioner shall approve, modify or disapprove any proposed
66changes to base rates; provided, however, that the commissioner shall only modify or disapprove
67any proposed changes to base rates that are excessive, inadequate or unreasonable in relation to
68the benefits charged.
69 SECTION 7. The first paragraph of subsection (d) of section 7 of chapter 176K of the
70General Laws, as so appearing, is hereby amended by striking out the second sentence and
71inserting in place thereof the following sentence:- The commissioner shall approve, modify or
72disapprove the proposed rates; provided, however, that the commissioner shall only modify or
73disapprove any proposed rates that are excessive, inadequate or unreasonable in relation to the
74benefits charged.