Six years after Governor Mitt Romney required every resident to obtain health insurance, Governor Deval Patrick signed a law that many consider the second phase of that groundbreaking experiment: trying to rein in the state’s health costs, which are among the highest in the nation.
The new law — which Patrick signed Monday at a State House ceremony packed with hospital executives, health care advocates, and lawmakers — seeks to keep health spending from growing faster than the state’s economy through 2017. For five years after that, the law aims to further slow spending, to half a percentage point below the growth of the economy.
Supporters say the law could save $200 billion in health costs over the next 15 years by encouraging providers to use fewer costly medical procedures, to better coordinate care to keep patients out of the hospital, and to steer patients to lower-cost caregivers.
“We are ushering in the end of the fee-for-service care system in Massachusetts in favor of better care, at lower cost,” Patrick said, to applause from a stage in Nurses Hall that was bathed in blue light and decorated with the flags of Massachusetts and the United States.
The bill was Patrick’s top priority and one he had talked about since at least the 2010 governor’s race. It was also the most prominent bill signed into law this year and will be closely watched by legislators around the country as a potential model, in the same way that the 2006 law was the model for President Obama’s health care law.
Some health care advocates have said that a new commission that will monitor the growth in spending does not have an enforcement mechanism that is strong enough to control providers that fail to meet their spending targets.
Conservative critics say the law goes too far toward a government-centered approach, imposes millions of dollars in new fees on hospitals and insurers that will be passed on to consumers, and could discourage doctors from practicing in Massachusetts.
The 349-page law also adds to the state bureaucracy by creating 25 new boards, task forces, and commissions, which will need 266 appointees, according to the Pioneer Institute, a conservative think tank that has been critical of the law.
Moody’s, the Wall Street credit-rating agency, warned that the law could hurt hospitals because it will “limit their revenue growth and reduce their operating flexibility.”
Attorney General Martha Coakley, who will investigate certain health providers that exceed their spending targets, said the government has to be careful not to trample on the private market.
“We’re not trying to overly regulate,” Coakley said Monday. “We’re trying to find that sweet spot, and I think the bill accomplishes that.”
House Speaker Robert A. DeLeo and Representative Steven M. Walsh, cochairman of the Committee on Health Care Financing, joined Coakley and the governor at the ceremony. They all praised the work that industry executives and advocates did in writing the bill.
“It’s law; congratulations,” Patrick said after he put his name on the legislation.
Despite the back-slapping and hearty talk of collaboration, no one from the state Senate showed up at the ceremony.
The absence of the Senate president, Therese Murray, was particularly notable, not only because of the bill’s magnitude, but because she had made it one of her top priorities.
Murray “didn’t want to attend the bill signing without Senator [Richard] Moore, who played a major role in developing the legislation,” said David Falcone, a Murray spokesman.
Moore, the Senate’s lead health care negotiator, could not attend because of a previously scheduled commitment with the National Conference of State Legislatures, Falcone said.