Give Steward a chance to show what it can do

As a general rule, budget riders that make significant policy changes deserve extra scrutiny. Those ideas, after all, haven’t gone through the regular legislative process.

Still, one outside section of the Massachusetts House budget is worthy of serious consideration. Its aim is to let Steward Health Care System, the state’s largest community-based hospital network, care for Medicaid patients on an accountable care basis. Under such an arrangement, Steward would receive a set payment for serving a group of low-income patients rather than be paid on a fee-for-service basis.

Health care is currently in transition. Experts and policymakers see a need to experiment with new approaches that hold the promise of bringing down high costs. Accountable Care Organizations, or ACOs, which let providers retain some of the savings they realize in delivering care as long as they meet quality standards, are one promising avenue. The hope is that moving to accountable-care arrangements will lead to better coordinated health care, with a greater emphasis on wellness and prevention, and less of the expensive testing and imaging ordered up by doctors paid on a fee-for-service basis.


The Massachusetts Association of Health Plans, which represents almost all of this state’s insurers, has voiced a number of objections. MAHP worries that the legislation represents a possible first step toward Steward, a health care provider, moving in a more general way into the province of insurers, or payers, and without having to meet the same requirements insurers face. Meanwhile, the fact that Steward is a for-profit network in a space mostly filled with nonprofit providers and payers, adds another wrinkle to the equation.

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Certainly this legislation shouldn’t give Steward a broader entry into the insurance world without requiring them to meet the same standards that carriers are held to. But those concerns are easily addressed legislatively.

Steward, meanwhile, is already providing health care on a similar basis for Medicare patients as one of 19 organizations participating in Medicare’s Pioneer ACO program. And it is doing well there; a report for Medicare shows Steward as one of the leaders in helping the federal health care program for seniors realize significant savings.

The Medicare Pioneer ACO program has strong quality standards to ensure that providers can’t realize savings by scrimping on necessary care. A well-designed Medicaid ACO program would need similar safeguards. But given Steward’s success in Medicare’s ACO experiment, the hospital network deserves a chance to show what it can do if allowed to use the same approach with those covered by Medicaid.