BOSTON — “Today, Governor Healey signed two historic health care bills into law that will strengthen oversight of the health care market and address rising drug costs. The HPC applauds the leadership of the Healey-Driscoll Administration, as well as Speaker Mariano and Senate President Spilka for working to pass consequential and nation-leading legislation to protect patients and to improve the access and affordability of health care in the Commonwealth.
“This significant legislation includes a slate of imperative provisions, which align with recommendations put forth by the HPC, that will enhance the public transparency and accountability of the Commonwealth’s health care system, and better protect this state from predatory actors. Together, these bills represent the most meaningful advancement of Massachusetts' health care oversight and cost containment laws since 2012, and the HPC commends Health Care Financing Co-Chairs Representative Lawn and Senator Friedman for their commitment to policy action this legislative session.
“We look forward to working with our colleagues across state government to advance a health care system that is affordable, equitable, and puts patients first.”
- HPC Executive Director David Seltz
Provisions of these bills which impact the HPC’s authorities and oversight include:
- Changes to the HPC Board appointments, effective July 1, 2025, by (1) replacing the Secretary of Administration and Finance (ANF) with the Commissioner of the Division of Insurance (DOI); (2) eliminating the current primary care physician and purchaser representing business management positions; (3) adding a new member with expertise representing hospital systems and a new member with expertise in health care innovation, including pharmaceuticals, biotechnology, or medical devices; (4) removing the Auditor as an appointing authority (those appointments shift to the Governor); and (5) adding an annual financial stipend for commissioners (not including the ex officio members). It maintains the current conflict of interest provision applicable to HPC commissioners.
- Establishes a new HPC Office for Pharmaceutical Policy and Analysis to analyze trends related to pharmaceutical access, affordability, and spending in the Commonwealth, including an annual survey of payers on drug plan design elements and policy recommendations related to pharmaceutical access and spending.
- Strengthens HPC’s market oversight authority, including by requiring notice and authorizing review of additional types of provider transactions known to impact cost, quality, access, and equity. These include significant expansions in a provider's capacity, transactions involving a significant equity investor, significant sales or transfers of assets including, but not limited to, real estate sale lease-back arrangements, and conversion of a provider from a non-profit entity to a for-profit entity.
- Establishes a new HPC Office of Health Resource Planning charged with development of a state health plan to identify anticipated demand, supply, and distribution of health care resources, and to make recommendations to address anticipated need, as well as doing focused assessments in specific service areas or geographies. This new office replaces the defunct health planning council.
- Adds new stakeholders required to testify at the HPC’s annual Health Care Cost Trends Hearing, including significant equity investors, health care real estate investment trusts, management services organizations, pharmaceutical manufacturing companies, and PBMs. It also adds MassHealth, the Health Connector, DOI, and representatives from the Centers for Medicare and Medicaid Services (CMS) to the list of witnesses.
- Expands the scope of information received by registration of provider organizations (RPO) program to include equity investors, health care real estate investment trusts, and management services organizations, and expands the RPO reporting threshold to include revenue generated from all payers.
- Increases penalties for non-compliance with data reporting requirements of CHIA, including transparency and reporting obligations under the Registration of Provider Organizations (RPO) program, increasing weekly fines to $25,000 and removing the cap, and allowing CHIA to inform HPC and DPH of non-compliance in conjunction with CMIRs and DoN.
- Makes changes to the Determination of Need (DON) Process, including for DPH to consider in its review of a DON application any relevant data from the HPC, such as any final Cost and Market Impact Review (CMIR) report related to a provider or provider organization, and codifies DPH regulations to toll the DON timeline for an independent cost analysis, CMIR, and performance improvement plan (PIP).
- Expands entities subject to Both HPC’s and CHIA’s annual funding assessment to include pharmaceutical manufacturers, pharmacy benefit managers, and “non-hospital provider organizations” that are required to register with the Registration of Provider Organizations (RPO) program, including clinical laboratories, imaging facilities, and urgent care centers. This assessment overhaul is to be implemented by FY 2026.
- Adds “health equity” to the priorities for investment from the HPC-administered Payment Reform Trust Fund.
- Requires the HPC, in consultation with CHIA, the GIC, MassHealth, and DOI, to evaluate impact of a newly established program to cap out-of-pocket costs for drugs selected to treat diabetes, asthma, and two chronic heart conditions, and to conduct this evaluation every two years.
- Creates a new 25-member task force to study primary care access, delivery, and payment in the Commonwealth, to be co-chaired by the HPC Executive Director and the Secretary of Health and Human Services.