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Robert brown

Massachusetts’ health care cost containment option could affect life sciences economy

A House-Senate conference committee on Beacon Hill will soon make decisions about the health care industry in Massachusetts. While the focus of the committee’s work is cost containment, the outcome of those deliberations may have larger implications that could affect our state’s ability to compete in the international life sciences economy.

This concern comes to mind in the wake of the recent BIO Convention, which brought 15,000 biotechnology professionals from around the globe to Boston. Many visitors asked what led to the growth of the life sciences and biotechnology sector here and why so many of the leading life sciences companies decided to locate here.


We are an epicenter of the knowledge and innovation economy because we are the world’s premier center for academic and medical research, built on a foundation of internationally recognized academic, health care, and research institutions. These institutions collectively attract more National Institutes of Health funding per capita than is garnered by any other state; we are challenging for the top spot in absolute dollars of NIH funding, despite our comparatively small size. Our hospitals draw more NIH funds than any other hospitals in the country. These same hospitals also generate a large number of patents for their discoveries and license these innovations to the commercial marketplace — creating new businesses as well as medical breakthroughs. Today, 1 in 6 jobs in Massachusetts is in the basic health care sector.

The critical mass of research and brainpower is at the core of the Massachusetts innovation economy and fuels the incubation of the next generation of Polaroids, Wangs, and Digitals — this time in the life sciences. I invoke those names to make a point: progress is not permanent, and it’s not necessarily inevitable. We lost many high-tech companies to other states and others failed. We could again lose the future of life sciences as well if we are not careful to preserve and protect the assets that are at the foundation of our economy.


This raises the question of how we got to the point of critical mass, or, why we have greater assets than say, Texas. The answer is that the Legislature has made key decisions and commitments that have recouped initial investments many times over in their contributions to our modern knowledge-based economy. Perhaps the best example of this is the Legislature’s 2008 passage of the Life Sciences Initiative, a $1 billion, 10-year program proposed by Governor Patrick that includes the creation of jobs by making strategic investments and building links among public and private institutions.

Now the Legislature is considering how to slow the rise in health care costs. The House and Senate deserve great credit for making health care affordable for our citizens. And controlling cost is, no doubt, the key next step to making universal health care work. I encourage the conference committee to consider this step in the broader context of the leadership of our academic medical centers and the life science economy that depends on this leadership.

According to published reports, a policy choice being discussed is the extent to which the state should determine or regulate medical costs. That is certainly one option — subtracting or reducing the growth in health care revenue can “control” costs. But it can also limit the amount of money our institutions have to reinvest in the highest quality care, medical research, jobs, and facilities.


Weighing the proposed policy changes against those possible consequences is important under any circumstances. It is especially important to do so today when our academic medical centers are simultaneously facing dramatic cuts in research funding because of the budget debate in Washington. If mandatory federal budget cuts go into effect as scheduled in January, Massachusetts is likely to lose at least $196 million in NIH research funding, and that could cost the Commonwealth over 2,500 jobs.

Making health care accessible and affordable is an important goal. But in legislating how to get there, we should take care to avoid any unintended consequences, which may make it harder for us to successfully compete in the life sciences economy and continue creating jobs and opportunities that benefit our community-at-large.

Robert A. Brown is president of Boston University.