Tackling rising health care costs in Massachusetts.

The federal system of the United States gives states substantial latitude and authority to regulate their economic affairs. With health care having grown from 13.8% of the national economy in 2000 to 17.9% in 2010, state governments have developed a major stake in ensuring that relentless growth in health care spending is controlled more effectively. In Massachusetts, for example, the costs of Medicaid for low-income residents and private health insurance for state employees account for approximately 40% of the state budget. Rising insurance premiums are also dampening wages in the private sector. A recently enacted Massachusetts law that seeks to control health care spending may therefore provide useful policy lessons for other states and the federal government. (August 8, 2012)