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Employers: Federal Health Reform Must Change

Posted by Katie Holahan on Feb 8, 2017 10:00:00 AM

Massachusetts employers believe overwhelmingly that federal health-care reform must change, but their opinions about how to do so vary widely.

Health_Care_Reform.jpgA new AIM survey finds that 43 percent of Bay State employers think that Congress and President Donald Trump should make changes to the existing Affordable Care Act, or Obamacare. Forty percent favor repealing the law and replacing it with an alternative program.

Eleven percent want to leave the current system in place while seven percent would repeal the reform law without an alternative.

The president and the Republican-controlled Congress have made “repeal and replace” a centerpiece of their governing priorities for the first 100 days. Republicans have yet to agree upon an alternative, but appear to favor eliminating the tax penalties imposed on people who go without insurance and on larger employers who do not offer coverage to employees.

The AIM survey was taken in January and is based upon responses from 162 employers from all sectors of the Massachusetts economy.

“The paperwork for Obamacare is ridiculous and terrifying for the regular person,” wrote one employer.

“We used to get one bill and now you get a bill from each doctor and have to wait for explanation of benefits and pre-register for everything. They have made health care so many layers it's no wonder the prices are through the roof.”

Another employer echoed that frustration.

“Trying to make changes to a 2,700-page bill with over 40,000 pages of accompanying regulations is bizarre. Start over,” the employer wrote.

Richard C. Lord, President and Chief Executive Officer of AIM, said employers supported the 2006 Massachusetts health-care reform as a first step to controlling the cost of providing health insurance to workers. Federal reform caused upheaval for many small employers in Massachusetts, but Lord also warns that an ill-considered repeal might put at risk billions of dollars in federal Medicaid funding that made the Bay State reform so successful.

“The expansion of Medicaid is exerting significant financial pressure on the state budget. Our hope is that policymakers in Washington can agree on some common-sense tweaks to Obamacare that would work to everyone’s benefit.”

Republican leaders formulating a replacement health reform have talked about eliminating tens of billions of dollars provided each year to states that have expanded eligibility for Medicaid. They have also discussed repealing subsidies for private health insurance coverage obtained through the public marketplaces known as exchanges.

The 2010 federal reform imposed taxes and fees on certain high-income people and on health insurers and manufacturers of brand-name prescription drugs and medical devices, among others. Republicans have not said for sure which taxes they will scrap and which they may keep.

The policy debate in playing out amid growing signs of accelerating health-insurance premium costs.

“My insurance premiums increased 24 percent this year. That is a little excessive,” one employer wrote.

Topics: Health Care Reform, Health Care Costs, Health Insurance

Proposed Assessment Will Hurt Employers Who Provide Health Insurance

Posted by Rick Lord on Jan 26, 2017 3:00:40 PM

Governor Charlie Baker yesterday described his proposal for a $300 million health assessment on employers as an attempt “to wrestle with the fact that a huge portion of people who are working full-time are either not taking coverage that's available through their employer and going on MassHealth, or are working for people who aren't offering them coverage at all, and going on MassHealth."

health_care.jpgHe added, according to State House News Service, that “the centerpiece of this budget really is a smart and common-sense approach to address the problem of costs being shifted from private sector employers for their employees onto state government."

Set aside for the moment the questionable premise of rampant cost shifting in a commonwealth where 76 percent of employers offer health insurance compared to 55 percent in the rest of the country.

The important point is that the governor’s sweeping proposal goes far beyond targeting employers who offer no health insurance, and instead penalizes employers who already offer high-quality insurance coverage to their employees.

It appears that money, not fairness, is driving the new fair-share assessment.

The administration plan would impose a $2,000-per-employee fee upon companies at which at least 80 percent of full-time worker equivalents do not take the company’s offer of health insurance, and that do not make a minimum contribution of $4,950 annual contribution for each full-time worker. If 70 percent of a company’s employees accept company health insurance, the company would be assessed $2,000 per employee for the number of employees represented by the 10 percent difference.

The employer assessment, which would bring an estimated $300 million into state coffers, represents a revival of the so-called fair share contribution plan that was a linchpin of the 2006 universal health care law in Massachusetts before it was repealed to make way for the federal Affordable Care Act. The state employer mandate was repealed in 2013 as lawmakers and former Gov. Deval Patrick worked to bring Massachusetts into compliance with federal health-care reform.

AIM asked multiple employers of varying sizes to determine whether they would be subject to an assessment under the governor’s plan. Every one of the companies, from small manufacturers to international financial institutions to corner retailers, reported that they would face assessments. Most fell short of the 80 percent threshold because of employees using spousal health plans or because of the calculation of full-time equivalent employees.

“There is widespread concern among responsible employers that they are being dragged into an assessment intended for companies that provide no health coverage,” said Katie Holahan, Vice President of Government Affairs at AIM.

Holahan said AIM has developed an online calculator that will allow employers to determine how much they might owe under the governor’s proposal.

AIM opposes the employer assessment because the growing shortfall at Masshealth, which provides health insurance to 1.9 million low-income Massachusetts residents, is attributable solely to problems arising from the federal Affordable Care Act (ACA), a law that may well be repealed by the time Massachusetts solves its Medicaid problems. 

ACA made access to health insurance an entitlement based on expanded income eligibility.  Under the Massachusetts health care reform law of 2006, employees who were offered employer-sponsored health insurance were ineligible for MassHealth.  The ACA reversed that policy and allowed employees to decline employer coverage and still seek insurance through MassHealth.

The change created a migration of newly-eligible individuals from their employer-sponsored insurance to MassHealth, substantially increasing the commonwealth’s financial burden.  ACA made it an economically rational choice for eligible residents.

As MassHealth enrollment grows, the commonwealth experiences the reality that employers have faced for years - the high cost of health care coverage in this state threatens the underpinnings of the state economy.  This challenging moment underscores the fact that policymakers have concentrated too heavily on access issues instead of controlling the cost of health insurance, and now face a renewed imperative to lower costs for everyone in Massachusetts.

AIM looks forward to working with the administration and the Legislature to find a fair solution to the commonwealth’s challenging health-care financing issues.

Topics: Health Care Costs, Health Insurance, Charlie Baker

Infographic: The Governor's Proposed Health Assessment

Posted by Katie Holahan on Jan 25, 2017 4:21:34 PM

The Baker Administration filed a budget proposal today that, as expected, would impose a $2,000-per-employee tax on some employers to close a deficit in MassHealth. AIM opposes the assessment as unfairly burdening employers for a problem they did not create.

Which employers will be subject to the assessment? Here is an infographic that summarizes the administration proposal. AIM is developing a calculator that will allow employers to determine exactly what their costs will be under the new assessment.

If you have any feedback or questions about this proposal, please contact Katie Holahan at keh@aimnet.org or 617.262.1180.

Fair Share 2017.jpg

 

Topics: Health Care Costs, Health Insurance, Charlie Baker

Proposal to Revive Fair-Share Assessment Raises Concerns

Posted by Katie Holahan on Jan 17, 2017 8:17:07 AM

The 4,000 member employers of Associated Industries of Massachusetts (AIM) believe that the Baker Administration’s proposal to impose a $2,000-per-employee tax on some employers is an unfair way to close a deficit in MassHealth.

health_care.jpgThe proposal would force employers to foot the bill for a problem they did not create. The $600 million shortfall at Masshealth, which provides health insurance to 1.9 million low-income Massachusetts residents, is attributable solely to problems arising from the federal Affordable Care Act, a law that may well be repealed by the time Massachusetts solves its Medicaid problems 

AIM acknowledges that the ACA-generated deficit at MassHealth is not the creation or responsibility of the Baker Administration.

The Affordable Care Act (ACA) made access to health insurance an entitlement based on expanded income eligibility.  Under the Massachusetts health care reform law of 2006, employees who were offered employer-sponsored health insurance were ineligible for MassHealth.  The ACA reversed that policy and allowed employees to decline employer coverage and still seek insurance through MassHealth.

The change created a migration of newly-eligible individuals from their employer-sponsored insurance to MassHealth, substantially increasing the commonwealth’s financial burden.  ACA made it an economically rational choice for eligible residents.

As MassHealth enrollment grows, the commonwealth experiences the reality that employers have faced for years - the high cost of health care coverage in this state threatens the underpinnings of the state economy.  This challenging moment underscores the fact that policymakers have concentrated too heavily on access issues instead of controlling the cost of health insurance, and now face a renewed imperative to lower costs for everyone in Massachusetts.

State House News Service reports that the administration plan would impose a $2,000 fee for all full-time workers - defined as someone who works 35 hours or more - upon businesses that don't cover at least 80 percent of their workers and share at least 60 percent of the premium cost with employees.

The employer assessment, which would bring an estimated $300 million into state coffers, represents a revival of the so-called fair share contribution plan that was a linchpin of the 2006 universal health care law in Massachusetts before it was repealed to make way for the federal Affordable Care Act. The state employer mandate was repealed in 2013 as lawmakers and former Gov. Deval Patrick worked to bring Massachusetts into compliance with the ACA.

There are positive elements to the administration’s proposal as well. AIM supports a freeze on new mandated health-insurance benefits and a cap on provider rates.

AIM recognizes that the administration’s proposal is the opening bid in what will be a protracted debate. We look forward to productive discussions with the administration and the Legislature to find a solution that does not wreak irreparable harm on the Massachusetts economy.

Topics: Health Care Reform, Health Care Costs, Health Insurance

AIM Leaders Appointed to Three Key Commissions

Posted by Christopher Geehern on Sep 7, 2016 12:06:17 PM

Associated Industries of Massachusetts and several of its member companies have been appointed to represent employers on three key state commissions looking at health-care costs, financial best practices and the future of manufacturing.

Lord.short.jpgRichard C. Lord, President and Chief Executive Officer, was among 23 people named yesterday to a special commission studying the variation in prices among Massachusetts hospitals and health-care providers. The commission was established as part of a deal to avoid a ballot question that would have reduced health insurance payments to the state’s largest hospital network, Partners HealthCare, and given some of that money to lower-paid competitors.

Reports by the attorney general’s office and the Massachusetts Health Policy Commission have blamed rising health-insurance premiums in part on the fact that some academic teaching hospitals charge significantly more money for medical procedures than community hospitals with no better outcomes. Massachusetts residents obtain medical care at high-cost teaching hospitals far more frequently that people in other states.

Lord has been deeply involved in efforts to address the high cost of health care for more than a decade. He currently serves on the Health Policy Commission and was a charter board member of the Massachusetts Health Care Connector Authority. He was appointed to the special commission on price disparity by House Minority Leader Brad Jones, R-North Reading.

“Massachusetts is home to world-renowned hospitals and doctors, but we also know that up to one-third of all medical care is delivered inefficiently. I look forward to working with members of the commission to ensure that our unparalleled medical system is also affordable for employers and workers,” Lord said.

Others named to the special commission include AIM members Howard Grant, MD, President and Chief Executive Officer of Lahey Health System; Deb Devaux, Chief Operating Officer of Blue Cross Blue Shield of Massachusetts; Lynn Nicholas, President and Chief Executive Officer of the Massachusetts Hospital Association; and Lora Pellegrini, President and Chief Executive Officer of the Massachusetts Association of Health Plans.

By statute, the commission will also include the secretaries for administration and finance and health and human services, the attorney general, and the executive director of the Group Insurance Commission (GIC) under the co-leadership of the Senate Chair of the Joint Committee on Health Care Financing Senator James Welch and House Chair of the Joint Committee on Health Care Financing Representative Jeffrey Sanchez.

Holahan.jpgMeanwhile, Katherine Holahan, Vice President of Government Affairs at AIM, was named to a three-year term as a member of the State Finance and Governance Board.

The board works to further transparency, accountability and best practices among state entities relative to investments, borrowing, or other financial transactions involving public funds. 

The panel is required to review any derivative financial product relative to transactions entered into by state entities, including any quasi-public entity, independent authority, or any state entity that is authorized to manage or oversee public funds. Examples of these entities are: the Massachusetts Port Authority; the Massachusetts Water Resources Authority; and the Massachusetts School Building Authority.

The final appointment was Brian Gilmore, Executive Vice President of External Affairs, who was named to another term as a member of the Massachusetts Advanced Manufacturing Collaborative (AMC).

Gilmore.jpgMade up of leaders from industry, academia and government, the AMC implements and evaluates state policies to support the competitiveness of Massachusetts manufacturers. Gilmore leads AIM’s manufacturing initiatives and has worked on policy and projects that allow manufacturing companies to be efficient, competitive and attractive paces to work for skilled employees.

The AMC addresses issues through five working groups: (1) Promoting Manufacturing; (2) Workforce & Education; (3) Technical Assistance & Innovation; (4) Cost of Doing Business; and (5) Access to Capital. The AMC also works in parallel with President Obama’s Advanced Manufacturing Partnership and with seven other states through the National Governors Association Center of Best Practices Policy Academy on Advanced Manufacturing and Innovation.

 

Topics: Associated Industries of Massachusetts, Health Care Costs, Manufacturing

It's Time for Massachusetts to Buy Local

Posted by Bob Rio on Apr 20, 2016 7:30:00 AM

It seems everyone these days wants to buy from local sources.

Farmers_Market.jpg“Buy local” has become a familiar battle cry in restaurants, retail stores and roadside stands among consumers who prefer to know where their favorite products are made. These consumers want to be confident that the items they buy are made sustainably and that their purchases support local jobs.

But why does the concern for locally made products in Massachusetts seem to stop at the farmers market? Why have scores of Bay State companies, some household names, and the thousands of local jobs they provided, disappeared with virtually no notice or outcry from state officials? And why has our commonwealth not resolved the problems that drove these companies away?   

Do you own a Polartec jacket for hiking (or to make it look like you hike)? The company, formerly known as Malden Mills, was started in 1906 and was miraculously able to recover after a devastating fire in 1995 nearly bankrupted the business. Polartec recently announced the closing of its Lawrence manufacturing facility, putting 350 unionized employees out of work and moving production to New Hampshire and Tennessee.

Use salad dressing on that locally sourced lettuce? Cain’s products, started in Boston 1914, is closing its Ayer plant, putting another 100 people out of work. The company is moving production to Pennsylvania, Georgia and Kentucky.

The list goes on. General Mills in Methuen, makers of Yoplait yogurt since 1993 closed, sending 144 jobs to other states. Kraft foods, located in Woburn for some 95 years, is putting another 200 people out of work. Sunny Delight is cutting 50 jobs in Littleton. Notini and Sons in Lowell, 100 jobs lost after 125 years. Courier Corp, a printer founded in 1824 and recently sold to an out-of-state firm, is shutting down its Westford plant putting 200 people out of work.

And those 1,144 jobs lost are just the ones that have been publicly announced in 2015 and 2016.

The reason for these closings are varied and complex. Some companies were sold to out-of-staters, while others cited high costs in Massachusetts for labor, housing, health insurance or energy. Some just used the euphemism “competitive realignments,” which probably includes a little bit of everything.

But all of the announcements have one thing in common – these companies and brands are not coming back and their employees and suppliers who depend on them are looking for jobs.

Massachusetts takes a back seat to no one in its ability to brag about the reason companies locate here – our universities, our educated work force, our innovation industries. General Electric’s announcement in January that it will move its corporate headquarters to Boston unleashed a euphoric wave of valedictories about the innovation ecosystem that GE hopes will help it to create the industrial Internet.

But the state seems strangely unconcerned with the reasons that companies leave. It’s disheartening, especially for the hard-working people who lose their jobs and their livelihoods. How can we make the Massachusetts economy successful for everyone if we don’t know why companies come or go?

The 4,500 member employers of Associated Industries of Massachusetts believe that the acceleration in business closings has much to do with the persistently high cost of health care and energy in Massachusetts.

Health-care costs in Massachusetts remain 36 percent more than the national average. Between 2005 and 2014, increases in health insurance premiums have outpaced income gains, consuming more than 40 percent of family income growth over the past nine years.

The relentless acceleration of health-care spending and health-insurance premiums threatens both the continued growth of the Massachusetts economy and the ability of citizens to access the commonwealth’s world-renowned medical system. It also threatens the commonwealth itself - MassHealth, the government insurance program for low-income residents, now accounts for 40 percent of the state budget at $14.7 billion annually.

Energy costs are likewise among the highest in the country – nearly double most places these companies are moving production to.

To those that care about the price of electricity – and that includes many companies outside the Boston area – our high prices are a never-ending drag on local profits. At a 5 percent profit margin – probably about right for food businesses – every dollar increase in electricity, health care, taxes or other costs that don’t contribute to increased production means another $20 in revenue is required just to break even. At some point, even the strongest fighter gives up.

The future promises little change. Despite an outcry from the business community about high electric rates, the legislature recently passed – and the governor was happy to sign - a new solar bill that will continue our highest-in- the nation subsidies. The justification - to protect solar jobs.  

While it is comforting to know that the Legislature is willing to tax some industries to support favored ones, it is also time to realize that Massachusetts is made up of several economies. The economies in the eastern part of the state have different issues than those in the central, western and southeastern areas, particularly around the bottom-line cost areas such as electricity and health care.  

Sure, companies will always realign their businesses. In some cases that may spell job losses for Massachusetts, in other cases, like GE’s, it may signal gains. But the state should not be complicit in a company’s demise by failing to respond to economic issues.

You’ll still be able to buy Polartec jackets, eat Yoplait yogurt and slather your sandwich with Cain’s mayo at the time next year. But the good jobs at good companies providing good wages we’ve depended on for decades won’t be locally sourced any more.

Topics: Health Care Costs, Economic Development, Energy

Health-Insurance Costs Remain Concern for Employers

Posted by Karen Choi on Mar 28, 2016 2:58:15 PM

Massachusetts employers have apparently decided that increasing deductibles and co-pays is a better way to control health-insurance costs than providing financial incentives for employees to seek care from low-cost, high-quality doctors.

2016_AIM_Benefits_Report_Cover.thm.pngThe 2016 AIM Benefits Report from Associated Industries of Massachusetts finds that controlling the cost of providing health insurance for employees remains the dominant benefits concern for Bay State companies. Ninety-four percent of the 197 employers who participated in the survey remain “very concerned” about escalating health insurance costs, while 76 percent are concerned about increased employee cost-sharing for benefits.

Employers are addressing those escalating health insurance costs by adopting high-deductible, consumer-driven health plans. Half of survey participants offer a consumer-driven health plan, with the most common cost-containment strategies being increased deductibles (28 percent), increased employee premiums (26 percent) and increased out-of-pocket maximums (21 percent).

There is far less enthusiasm for tiered networks, which health-care economists tout as an effective method of managing costs by paying more for medical care rendered in lower-cost settings and less for care delivered in high-cost academic medical centers. Just nine percent of survey participants offer a tiered network plan, even though a third of those companies have experienced a decrease in premiums.

Seventy-one percent of companies say they have no plans to offer a tiered network product in the future. Companies that have declined to adopt tiered networks most often cite not wanting to change the levels of benefits for employees as the reason.

“The survey seems to illustrate the ‘hallway effect,' ” said Russ Sullivan, Vice President of Health-Care Solutions at AIM.

“It is difficult to potentially disrupt the health-care choices or increase out-of-pocket costs of someone with significant medical expenses who you see each day.  Incremental changes to payroll contributions and co-pays are a more comfortable decision.”

Other structural changes face similar resistance. More than three-quarters of employers do not use health risk assessments to identify opportunities to improve the health of workers.

The share of employers who say they are “very concerned” about establishing a wellness program dropped to 31 from 37 percent in 2014 and 40 percent in 2012. Almost two-thirds of employers with 200 or fewer employees eligible for the Massachusetts Wellness Tax Credit said they did not know about the program.

Management of health-insurance costs will take on renewed significance for employers in 2016 as premium inflation in Massachusetts accelerates after several years of muted growth. Health insurance rates paid by small employers and individuals in Massachusetts surged 6.3 percent during the first quarter while major insurance companies are raising overall average premium rates anywhere from 3 to 13 percent. 

The AIM Benefits Survey found that the average premium for coverage through a health maintenance organization (HMO) rose 9 percent this year versus 7 percent in 2014. Premiums at preferred provider organizations (PPO) will also increase 9 percent in 2016, up from 6 percent two years ago, while rate increases for high-deductible plans have almost doubled from 2014 to now.

Insurance carriers attribute the premium increases to increases in drug costs, increased levels of plan utilization and costs associated with the implementation of federal health-care reform.

The average cost to provide health insurance to a family ranges from $1,011 per month for a high-deductible plan to $1,494 per month for an HMO, according to the AIM survey. Employers, on average, pay anywhere from $607 to $986 of those premiums depending on the insurance product.

The trend toward increased deductibles and co-pays is national. Research by the Kaiser Family Foundation indicates that deductibles for all workers have risen almost three times as fast as premiums and about seven times as fast as wages and inflation since 2010.

Other highlights of the survey include:

  • 87% of employers offer short-term disability benefits;
  • 93% of employers offer life insurance benefits;
  • 13% of survey participants still offer a defined-benefit pension plan, through 14 percent of those companies have closed to new participants;
  • Two-thirds of employees, on average, participate in their company’s 401(k) plan;
  • 58% of employers offer a paid time-off bank; and
  • 80% of employers with a work force outside of Massachusetts plan to offer the same earned sick-time benefits required for employees who work a majority of the time in state.

Purchase the 2016/2017 AIM Benefits Report

Topics: Health Care Costs, Health Insurance, Benefits

Why Are Health-Care Costs Rising?

Posted by Katie Holahan on Feb 9, 2016 2:33:45 PM

A study released today by the Massachusetts Association of Health Plans, Associated Industries of Massachusetts (AIM), the National Federation of Independent Business (NFIB), and the Retailers Association of Massachusetts (RAM), identifies 14 key factors in the rising cost of health care.

HealthCost.jpgThe report is based on a review by Freedman HealthCare (FHC) of nine recent studies of the Massachusetts health-care marketplace.

"The rising cost of health care is a significant challenge for Massachusetts employers. These reports shed light on the factors driving health care costs and will inform the conversation on measures to contain the cost of health care," said Rick Lord, President and Chief Executive Officer of Associated Industries of Massachusetts.

Here are the 14 factors:

  1. Provider price, not utilization of health care services, is the biggest cost
    driver in the Massachusetts market. (Providers are doctors, hospitals and other entities that render medical care.)
  2. There is a significant gap between the highest and lowest paid providers.
  3. Health care is most often delivered in higher priced settings.
  4. High prices do not directly correlate with high quality of care – in other
    words, the highest paid providers do not necessarily provide the highest
    quality of care.
  5. Providers with the highest public payer case mix have the lowest
    commercial reimbursement.
  6. Academic medical centers are associated with higher health care costs.
  7. In response to increasing provider prices, the commercial market is seeing
    increased consumer cost sharing.
  8. Market share impacts health care costs by influencing price, utilization,
    and available resources.
  9. There is growing policy concern that provider consolidation may lead to
    higher prices, rather than savings from integration of care or improved
    efficiency.
  10. Despite its increasing promotion, the widespread adoption of global
    payments faces significant challenges, and there is limited evidence to
    suggest that global payments produce cost savings.
  11. Performance against the cost growth benchmark is mixed.
  12. Pharmaceutical costs have been increasing and are expected to increase
    in the future.
  13. The state is increasingly focused on behavioral health – specifically, the
    high cost associated with behavioral health conditions, the challenges of
    clinical and administrative integration of care, and the need for better data.
  14. Due to persistent and increasing disparities in provider prices over the
    past several years, the state is recommending policy action be taken to
    reduce excessive price variation.

Topics: Health Care Reform, Health Care Costs, Health Insurance

Video Blog | Economic Growth, Health Costs, Talent Development

Posted by Christopher Geehern on Jan 22, 2016 3:02:53 AM

The 2016 Associated Industries of Massachusetts Economic Outlook Forum featured a panel of experts looking at prospects for the Massachusetts economy. The panel, moderated by WBZ radio Business Editor Jeff Brown, included Jay Ash, Secretary of Housing and Economic Development; Martha Sullivan, President and CEO of Sensata Technologies in Attleboro; and Dr. Howard Grant, President and CEO of Lahey Health in Burlington.

 

Topics: Skills Gap, Health Care Costs, Massachusetts economy, AIM Executive Forum

GE Move Uplifts Economic Outlook Forum

Posted by Christopher Geehern on Jan 15, 2016 11:41:53 AM

The decision by General Electric Company to base its headquarters in Boston underscores a coalescing of economic activity in major global cities, a development that simultaneously benefits Massachusetts and challenges leaders to spread the benefits beyond Route 495.

Panel-1.jpgGE’s blockbuster announcement was topic number one this morning as business and government leaders gathered for the annual Associated Industries of Massachusetts Economic Outlook Forum in Waltham.

AIM President and Chief Executive Officer Richard C. Lord said metropolitan areas like Boston, with its rich array of universities, hospitals and financial resources, enjoys its own economic gravitational pull in a rapidly changing economy. That pull, he said, raises two important questions for Massachusetts.

“First, as anyone who sits in Expressway traffic or waits for the T in January will tell you, rapid growth strains the physical and financial resources of the state and its citizens. And then talk to young people trying to afford housing close to their jobs in a city where the Alston-Brighton triple decker in which Ted Williams once lived now sells for more than $1 million with units that rent at more than $2,000 per month,” Lord told more than 250 people who attended the forum.

“Second, and most important, what happens to the economy outside Boston? How do we as a “common wealth” address the widening imbalance between the economically thriving ‘eds and meds’ economy of Greater Boston and the more traditional economy that dominates the commonwealth from Route 495 to Berkshire County?”

Secretary of Housing and Economic Development Jay Ash compared the importance of GE’s move to the Celtics’ acquisition of all-star forward Kevin Garnett in 2007.

“The Celtics were already a good team, a playoff team, but when Kevin Garnett came, he was a Hall of Famer who put the Celtics over the top,” said Ash, who led the commonwealth’s efforts to land GE and its 800 headquarters and research jobs.

The key to the deal, Ash said, was cohesive approach adopted by Governor Charlie Baker, a Republican, and Boston Mayor Matry Walsh, a Democrat.

“I’ve been in politics all my life and I’ve never seen two leaders working so closely together, let alone leaders from different parties working so closely together,” he said.

Ash made his comments during a panel discussion on prospects for the Massachusetts economy in 2016.

Martha Sullivan, Chief Executive Officer of Sensata Technologies in Attleboro, said developing engineering and other technical talent remains a priority for her century-old company, which makes many of the sensors that are the basis of what GE and others call the “industrial Internet.”

Sullivan said that companies must have a vision that attracts talent.

“You have to have a culture that is welcoming, with a diversity of talent, thought and background,” she said.

Dr. Howard Grant, President and Chief Executive Officer of Lahey Health in Burlington, said the Massachusetts economy is being held back by health-care costs that run 36 percent more than the national average. It doesn’t have to be that way, Grant said, if employers and consumers seek treatment in moderately priced community hospitals where medical outcomes match those of expensive academic medical centers.

“We need to do something about that,” Grant said.

Lord said in his annual State of Massachusetts business address that it’s good to be Massachusetts at the dawn of 2016:

  • The commonwealth is likely to approach full employment this year.
  • Massachusetts employers added almost 68,000 jobs during the first 11 months of 2015.
  • Economic output grew 25 percent faster than the nation as a whole, and per-capita personal income remains the second highest in the United States, 128 percent of the national average.
  • AIM’s widely followed Business Confidence Index remains solidly optimistic, despite a marked slowdown in foreign export markets.
  • Massachusetts posted a record-breaking year for venture capital funding in 2015, with $7.4 billion invested across 531 deals.
  • And Bloomberg just named Massachusetts the most innovative state in the nation.

Topics: Health Care Costs, Massachusetts economy, AIM Executive Forum

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