Twenty years after Massachusetts became the first state to achieve near-universal health insurance coverage, the business community that helped champion that reform now faces a harder problem: actually making care affordable.

According to the Boston Globe, business leaders gathered this week to discuss strategies for reining in health care costs that continue to outpace wage growth and inflation. The conversations reveal a sobering reality—while the 2006 Massachusetts health reform law, often called "Romneycare," succeeded in covering roughly 97% of state residents, it left the fundamental cost drivers of American health care largely untouched.

The timing is significant. Massachusetts employers have watched health insurance premiums climb steadily throughout the two decades since reform, with many now spending 15-20% of total compensation on health benefits. For workers, that often translates to higher deductibles, larger co-pays, and stagnant take-home wages as more compensation goes toward health coverage.

The Unfinished Business of Reform

The 2006 law, signed by then-Governor Mitt Romney, represented a genuine achievement in health policy. By creating subsidized insurance options, establishing an individual mandate, and requiring employers to contribute to coverage, Massachusetts proved that near-universal insurance was achievable in the American context. The model later influenced the Affordable Care Act.

But coverage and affordability are different challenges requiring different solutions. Expanding insurance largely involved redistribution and regulation—moving money around the existing system. Controlling costs requires changing how care is delivered, what providers are paid, and how much Americans consume health services.

These are far more difficult interventions, touching the business models of hospitals, pharmaceutical companies, and physician practices. They involve politically fraught decisions about limiting certain treatments, steering patients toward lower-cost providers, or challenging the fee-for-service payment model that rewards volume over value.

Why Costs Keep Rising

Several factors drive Massachusetts health spending upward. The state hosts some of the world's most prestigious medical institutions, which command premium prices for their services. Provider consolidation has reduced competition in many markets, giving hospital systems greater negotiating power with insurers. Pharmaceutical costs continue climbing, particularly for specialty medications. And an aging population requires more intensive services.

Administrative complexity adds another layer of expense. Despite reform, Massachusetts maintains a multi-payer system with numerous insurance plans, each requiring separate billing, authorization processes, and negotiations. This administrative overhead costs billions annually without directly improving patient health.

The business leaders' discussions, as reported by the Globe, likely touched on familiar potential solutions: reference pricing, centers of excellence, value-based payment models, and increased use of nurse practitioners and physician assistants. Many employers have experimented with these approaches for years with mixed results.

The Limits of Employer Action

Individual employers face inherent limits in controlling health costs. Most lack the market power to demand significant price concessions from dominant hospital systems. Employees resist narrow networks that restrict choice, particularly in a competitive labor market. And businesses generally want to focus on their core operations, not become health care experts.

This creates a collective action problem. What might work if all employers adopted certain strategies simultaneously becomes risky for individual companies to attempt alone. Employees might leave for competitors offering broader networks or more generous coverage.

Some business coalitions have attempted coordinated approaches, negotiating jointly with providers or establishing shared standards for coverage. These efforts show promise but remain limited in scale compared to the overall market.

Policy Solutions Remain Elusive

More fundamental cost control likely requires state policy intervention. Massachusetts has implemented various measures over the years, including a health care cost growth benchmark that aims to limit spending increases to the rate of economic growth. However, the benchmark currently lacks strong enforcement mechanisms.

Other potential policy approaches include global budgets for hospitals, all-payer rate setting (where all insurers pay the same rates), or a public option that could use government purchasing power to constrain prices. Each faces political obstacles and legitimate concerns about unintended consequences.

The pharmaceutical cost problem particularly defies state-level solutions, as drug pricing operates in national and global markets largely beyond Massachusetts' control. Federal action would be required for meaningful change, though recent legislation has begun addressing some aspects of drug costs for Medicare beneficiaries.

A Persistent Challenge

The business community's continued focus on health costs two decades after reform underscores both the success and limitations of the 2006 law. Massachusetts proved that political will and creative policy design could dramatically expand coverage. The state's model influenced national reform and demonstrated that universal coverage was achievable without a complete system overhaul.

But the anniversary also highlights what reform didn't accomplish. Health care in Massachusetts remains expensive—among the costliest in the nation. The fundamental incentives that drive spending upward persist. And the political difficulty of cost control may actually exceed the challenge of coverage expansion.

For employers and workers, this means the financial strain of health benefits will likely continue. Businesses will keep searching for marginal improvements while hoping for broader systemic solutions. Workers will continue seeing more of their compensation consumed by health costs rather than wages.

The conversation happening now in Massachusetts business circles matters beyond the state's borders. As the laboratory for health reform twenty years ago, Massachusetts may again point toward solutions—or reveal the limits of what's politically and practically achievable in American health care.

What seems certain is that expanding coverage, while difficult, proved easier than the work that remains. Making health care truly affordable requires confronting powerful interests, changing deeply embedded practices, and accepting tradeoffs that no one finds entirely comfortable. Twenty years in, that work has barely begun.