Press Release: 8/4/2026

Governor Healey Announces Health Care Affordability Working Group Recommendations to Lower Health Care Costs

 

Recommendations target out-of-network costs, prescription drug costs, insurance premiums, workforce shortages, barriers to primary care and administrative costs. Governor directs MassHealth to increase primary care spending to 12 percent

FOR IMMEDIATE RELEASE:

8/03/2026

BARNSTABLE — Governor Maura Healey today announced the recommendations of her Health Care Affordability Working Group to lower health care system costs across Massachusetts to help patients, families, providers and businesses. The 12 recommendations provide a roadmap to target some of the biggest drivers of health care costs, including out-of-network charges, prescription drug prices, workforce shortages, barriers to primary care, administrative costs and preventable hospitalizations. 

In response to the recommendations, Governor Healey announced that she signed an Executive Order directing MassHealth to increase its investments in primary care to 12 percent of total medical spending by the end of 2028. The Governor also expressed her strong support for the Legislature’s efforts to advance primary care legislation. The Healey-Driscoll Administration will be working to implement additional recommendations in the coming weeks and months.

“The cost of health care is putting too much pressure on families, employers and our entire health care system,” said Governor Maura Healey. “We brought together leaders with different perspectives and expertise because everyone agreed on one thing—we have to make health care more affordable. These recommendations give us a roadmap to lower costs, strengthen our workforce and make sure people can continue getting the high-quality care they deserve. While President Trump is causing costs to rise, cutting a trillion dollars from health care and kicking millions of people off their coverage, Massachusetts is yet again charting a path forward for affordable, accessible, high-quality health care for everyone.”

“Health care affordability affects every resident and every employer in Massachusetts,” said Lieutenant Governor Kim Driscoll. “These recommendations reflect months of collaboration and identify practical ways to lower costs while protecting access to high-quality care. We look forward to working with our partners across the health care system to put these recommendations into action.”

"As a physician, I have seen firsthand how health care affordability impacts an individual’s ability to access care.” said Health and Human Services Secretary Kiame Mahaniah, MD, MBA. “Everyone in Massachusetts deserves to have access to care that best fits their needs, and I am delighted to see that these recommendations outline a path to make that possible.”

"The Health Care Affordability Working Group has developed a list of 12 recommendations to lower health systems costs. By lowering health system costs, we can make health care more affordable for individuals, families and businesses across the Commonwealth,” said Health and Human Services Undersecretary of Health Amy Rosenthal. “I am proud to have worked with this group of leaders who have thoughtfully and collaboratively created these recommendations, keeping all of our heath partners and residents within Massachusetts in mind.”

"As an independent, tertiary, community health system that is the safety net provider for our region, it's our mission to serve everyone with high-quality, accessible, equitable, patient-centered care. Strategically addressing the critical challenges facing the American health care system today is paramount to supporting positive patient outcomes and experience," said Cape Cod Healthcare President and CEO Michael K. Lauf, who also served as the 2025 Chair of the Massachusetts Health & Hospital Association Board of Trustees, working closely with health care policy leaders to improve key issues confronting hospitals and health systems across the Commonwealth. "It was an honor to host Governor Healey for today's announcement, and we look forward to supporting the meaningful progress of these recommendations to ensure all individuals are able to get the care they need."

Governor Healey convened the Health Care Affordability Working Group in January to identify practical strategies to lower health care costs while maintaining Massachusetts' high standard of care. Co-chaired by former Health and Human Services Secretary Kate Walsh and Citizens Massachusetts President Lisa Murray, the Working Group brought together leaders from government, hospitals, insurers, providers, employers, labor, patient advocacy organizations and academia. Over the past six months, members developed 12 recommendations organized around five priority areas:

Helping People and Small Businesses:

Reduce Out-of-Network Costs

Patients can unknowingly receive care from out-of-network providers and face much higher bills. These out-of-pocket costs not only drive up their financial burdens, they also inflate insurance costs across the entire market. Although the federal No Surprises Act has helped protect patients, it has not fully contained costs. 

Governor Healey is directing the Division of Insurance (DOI) to establish default out-of-network payment rates. This reform will protect against surprise billing and reduce overall costs across the market. DOI will convene listening sessions to inform new regulations.

Stabilize the Health Insurance Market

Health insurance premiums continue to rise for individuals and small businesses, making coverage harder to afford and increasing costs across the health care system. Governor Healey is directing DOI to evaluate bold, new strategies to strengthen competition and reduce premium costs in the merged market.

Right Care at the Right Time in the Right Place

Innovative Health Care Models

For some patients, hospital-level care can safely happen at home or in the community, and innovative models can support patients in staying out of the hospital and other high-cost settings. These options can improve convenience, reduce unnecessary hospital or Emergency Room use, and lower costs. Many of these emerging models seek to leverage technology to manage chronic health conditions and empower the highly skilled health care workforce to provide patient-centered care in new ways. The Healey-Driscoll Administration is tasking state agencies to work with health care providers, health plans, and experts to design and execute a coordinated, comprehensive strategy to support the accelerated adoption of these innovative care models. The HPC recently announced funding for seven hospital-to-home pilot programs that help streamline discharges of individuals from acute care hospitals to their homes and communities. 

Transitions of Care

More than 2,000 patients in Massachusetts acute care hospitals are awaiting discharge on any given day, and the number of long-stay patients is increasing. When patients remain stuck in acute care hospitals, they face added harm, hospitals lose capacity, and costs rise. Patients should be able to move smoothly to the next step in their care, not wait because of paperwork, approvals or bed shortages. The HPC recently announced funding for seven hospital-to-home pilot programs that help streamline discharges of individuals from acute care hospitals to their homes and communities and additional work will be done in the coming months to support the use of these innovative health care models. The Healey-Driscoll Administration will explore action to modernize surrogate decision-making and health care proxy laws.

Low-Value Care

Some tests and procedures do not improve health, even though they are commonly ordered. For example, most patients do not need an MRI for lower back pain. The HPC will oversee a new clinical expert committee to identify low-value or inappropriate services so the system can focus on treatments that help patients. In the coming months, the committee will develop measurable goals, reporting requirements, and accountability mechanisms for reducing identified services, along with payment incentives to discourage inappropriate and costly care. This will bring down costs for everyone without sacrificing quality of care.

Investing in Workforce

Targeted Nursing & Workforce Investments

Massachusetts nursing programs turn away qualified applicants every year because they lack enough faculty and classroom capacity. Investing in nursing faculty recruitment and retention will allow schools to train more nurses and expand the pipeline, improve access to care, and reduce reliance on expensive temporary staff. These investments will also enable nursing schools – many of which are in community colleges or public universities – to expand. The Healey-Driscoll Administration is evaluating additional actions that can be taken to support faculty recruitment and retention like scholarships, loan forgiveness, and other approaches to lowering the financial barriers to nurses becoming and staying nursing faculty.

Education Investments

Massachusetts needs more primary care providers, nurses, behavioral health workers, long-term care staff and community health workers – these are high-value roles that address workforce shortages. Investing in this workforce is one of the most effective ways to expand access and reduce long-term health care costs. The Healey-Driscoll Administration will build on investments in training the health care workers communities need, including primary care providers, nurses, long-term care staff, behavioral health workers, and community health workers. 

Strengthening Primary Care

Primary care is the foundation of a strong health system and is associated with better outcomes, fewer hospitalizations, and less emergency room use. Yet the share of spending directed to primary care in Massachusetts is declining, making it harder for people to find and keep a primary care provider. Massachusetts should pass primary care reform legislation aligned with the key principles recommended by the Primary Care Access, Delivery, and Payment Task Force. That includes expanding access to comprehensive primary care with integrated behavioral health, increasing the share of spending going to primary care, reforming payment structure to support coordinated team-based care, and making it easier to recruit and retain providers. 

Governor Healey signed an Executive Order directing MassHealth to increase its investments in primary care to 12 percent of total medical spending by the end of 2028. The Healey-Driscoll Administration also strongly supports the Legislature’s efforts to pass primary care reform legislation.

State Leadership:

Reduce Prescription Drug Costs

Prescription drugs remain one of the fastest-growing health care costs. By negotiating as one purchaser instead of many separate entities, the state can use its buying power to lower prices and improve access to medications. The Executive Office of Health and Human Services (EOHHS), the Health Connector, Group Insurance Commission (GIC), and Health Policy Commission (HPC) will work together to develop a coordinated state strategy to leverage the state's purchasing power to lower drug costs and improve access to medications.

Manage GIC Prices

Hospital prices can vary widely between hospitals even for the same services and treatments, which drives up premiums for everyone. The state’s employee health plan, GIC, can help lower costs by setting standards for fair prices for some services without limiting where members receive care. GIC will take steps in the coming months to implement this.

Harnessing Technology

Data Exchange

Doctors and insurers often cannot easily share patient health information, which creates paperwork and slows care. Massachusetts should enhance its existing health information exchange system and processes so additional health information can move securely between hospitals, doctors and insurers, with further support for smaller health care practices. Enhanced data exchange can reduce duplicate paperwork and free up resources to help lower costs and ensure better care. The working group will convene health care data and technology experts to develop a proposed data exchange framework and roadmap.

Artificial Intelligence

New health care technologies, including AI, have the potential to improve patient care and reduce administrative costs if they are tested safely. Massachusetts wants to allow promising AI tools to be tried under strict oversight so innovation can move forward without putting patients at risk. Carefully tested AI tools could help providers work more efficiently and lower costs over time. At the same time, insurers and health care organizations increasingly use AI for coding, claims review, and coverage decisions that affect care and bills. Massachusetts should establish clear rules and transparency around how AI is used in these health care processes so decisions are fair, accountable, and do not cause errors, unfair denials, or delays in care. The Healey-Driscoll Administration supports responsible innovation and anticipates the creation of a future AI advisory group to inform needed changes.

The working group will continue to collaborate through the end of the year to finalize additional actions. Today’s announcement is the latest step in Governor Healey’s work to lower health care costs, protect patients and ensure residents are getting the care they need.

To address high health care costs and improve affordability, Governor Healey became the first Massachusetts Governor to cap co-pays and deductibles to limit out of pocket costs. She eliminated prior authorization requirements for routine and essential health care, including cancer scans and medications for chronic conditions like asthma, diabetes and heart disease. And she invested the most state funding in the country to protect 270,000 residents from significant health insurance cost increases after President Trump decided not to extend Affordable Care Act premium tax credits. Additionally, the Governor recently moved to ban medical debt from being reported to credit agencies.

Statements of Support from Working Group Members:

Kate Walsh, former Secretary, Executive Office of Health and Human Services and Former CEO, Boston Medical Center (Co-Chair)

“Affordability is one of the most urgent challenges facing patients, families, employers, and our entire health care system. Having served as Secretary of Health and Human Services and as CEO of Boston Medical Center, I've seen firsthand how rising costs place increasing strain on every part of the system. These recommendations are more important than ever. They represent a thoughtful, collaborative effort to identify the most meaningful opportunities to improve affordability, and I'm incredibly proud of the dedication, expertise and partnership our working group brought to this work.”

Lisa Murray, President, Citizens Massachusetts (Co-Chair)

“Health care affordability is critical issue for Massachusetts residents and these recommendations put on us on the path to tackling this problem head-on. Not only will residents see the benefit of this increased focus, but so will employers who are looking for help attracting and retaining talent here.”

Senator Cindy Friedman, Senate Chair, Committee on Health Care Financing

“The health care affordability crisis is one of the most pressing issues in our Commonwealth, and it is our responsibility to understand and analyze the main cost drivers in our health care system. As co-chair of the Subcommittee on Payment and Pricing Approaches, I am in strong support of the Health Care Affordability Working Group recommendations, which create a pathway for the provision of value-based care, including tackling provider pricing, addressing insurance and network design, and reducing pharmaceutical costs. I look forward to seeing these meaningful policy solutions put into action to provide much-needed relief to Massachusetts residents and businesses.” 

Representative John Lawn, House Chair, Committee on Health Care Financing

“By making targeted investments in primary care and investing in the education and training of our nursing workforce, we can lower costs across the system, expand access to quality health care, improve population health outcomes, and strengthen our workforce. Adopting innovative care models will improve patient access and experience, and ensure residents can get the right care, at the right time, when they need it. The recommendations of the Health Care Affordability Work Group are essential in creating a stronger, more affordable, and effective health care system that meets patients' health needs and supports our health care workforce.” 

Matthew J. Gorzkowicz, Administration and Finance Secretary

“Health care affordability is a top concern for residents of our Commonwealth. While we have made truly remarkable process on increasing health care access and affordability in the last two decades, there is much more to do. The Health Care Affordability Working Group recommendations announced today take an important next step toward helping residents better afford our world-class health care system.”

Michael Caljouw, Commissioner, Division of Insurance

“There is real momentum to lower health care costs for families and businesses. Especially in this detailed area, focused teamwork allows us to solve our toughest challenges.”

Ashley Blackburn, Deputy Executive Director, Health Care For All 

“These strong recommendations mark a meaningful step forward in making health care more affordable for people across the Commonwealth, and we commend the Governor for her leadership. Our HelpLine is flooded with callers struggling to pay medical bills and forced to delay or skip necessary care because of systemic issues we can and must address. We have been honored to contribute to this effort alongside many of the Commonwealth’s leading health care experts and look forward to working with the Healey-Driscoll Administration, the Legislature, and key stakeholders to turn these recommendations into meaningful improvements that make care more affordable and accessible for all.”

JD Chesloff, President & CEO, Massachusetts Business Roundtable

"Massachusetts employers continue to face unsustainable increases in health care costs that are impacting their ability to invest, grow, and create jobs. The Health Care Affordability Working Group's recommendations recognize that improving affordability requires a comprehensive approach—from strengthening the health care workforce and modernizing technology to delivering care in the most appropriate settings. We commend the Administration for bringing stakeholders together to create this thoughtful roadmap and look forward to continuing in that collaborative spirit to help turn these recommendations into meaningful action."

Ted Calianos, Executive Vice President & CEO, Massachusetts Medical Society

“Health care is a basic human right and it is simply unconscionable that our patients face financial barriers to high-quality care that can lead to serious medical complications, poor outcomes, and preventable death. Our physicians recognize the urgency of addressing this affordability crisis and applaud the Governor for convening this group and the diligent work and thoughtful recommendations put forth by all participating stakeholders. These proposals, which aim to make health insurance and prescription medications more affordable, reduce strain on our hospitals, and bolster the health care workforce with a focus on primary care, are critical steps toward the shared goal of improving the health of the Commonwealth.” 

Michael Curry, President & CEO, Mass League of Community Health Centers

“Lowering costs, increasing access, and improving our health care system is paramount. At this crucial moment, continued collaboration across all stakeholders is critical to our success in Massachusetts. As a key access point for affordable, high-quality care, Massachusetts’ community health centers will play a major role in realizing these recommendations. There’s still more work to be done, but the steps outlined by the Health Care Affordability Working Group represent a very promising path forward.”

Joe-Ann Fergus, Executive Director, Massachusetts Nursing Association

“The realities of the challenges and headwinds we face are daunting. The HCAWG provides a vital forum for us to listen to and learn from one another while exploring innovative ways to improve the quality of and access to affordable health care for the members of our communities.”

Audrey Morse Gasteier, Executive Director, Massachusetts Health Connector

“Massachusetts’ continued position as the national leader on health care depends on our ability to do the hard work of tackling health care costs and their rate of growth without diminishing access to care. Massachusetts residents – including the hundreds of thousands of people across the state who depend on the Health Connector for coverage – deserve nothing less than bold, new approaches that will show up in their lives in the form of a lower cost of living, a higher performing health care system, and an even stronger local economy. This first set of recommendations from the Health Care Affordability Working Group reflect that Massachusetts is ready to put in the work, is hungry for progress, and knows that the time for action is now.”

Tara Gregorio, President & CEO, Mass Senior Care Association

“Access to affordable, reliable health care for older adults and their caregivers is more critical than ever as demand for these vital services continues to grow. We are deeply grateful to Governor Healey for her steadfast leadership in prioritizing and advancing these public policy imperatives that harness technology, accountability, innovation, and consumer-driven solutions to ensure access to affordable care across the entire health care continuum. Her commitment to older adults, their caregivers and families is making a real difference, and we are especially eager to partner with her administration to ensure safe, seamless transitions of care for older adults at every stage of their health care journey.” 

Doug Howgate, President, Massachusetts Taxpayers Foundation

“Controlling health care costs is essential for an affordable Massachusetts and for a sound state budget. The recommendations announced today are a vital first step in implementing a thoughtful plan to address cost while maintaining the high-quality health care system our residents rely on.”

Jon Hurst, President & CEO, Retailers Association of Massachusetts

“I give the Healey/Driscoll Administration a lot of credit for leading on this most important affordability issue facing the Commonwealth. Given the wide-ranging objectives and views of the contributors at the table, this is a solid start. For the December final recommendations, we need to move forward on more difficult issues on the inefficiencies, high costs and inflationary nature of the system. Those decisions are going to be harder and more controversial, but will be extremely important for premium payers, taxpayers, and small businesses in order to deliver affordable and fair costs of living and costs of doing business in the Commonwealth.”

Sarah Iselin, President & CEO, Blue Cross Blue Shield of Massachusetts

“Massachusetts has led on health care cost containment policy before, and this moment calls for that leadership again to address the unsustainable growth in the cost of care. The Governor’s Health Care Affordability Working Group recommendations are a positive step in that direction. Solving this will take genuine partnership between providers, employers, government, and health plans, and we are ready to do our part to build a more affordable system for the future.”

Andrew Jackmauh, Executive Director, The Center for Health Information and Analysis

“I commend the Healey-Driscoll Administration for its leadership in bringing diverse stakeholders together around a shared and urgent goal: making health care more affordable for people across Massachusetts. These recommendations represent a significant milestone in the Commonwealth’s efforts to address the rising cost of health care and provide a strong foundation for meaningful action in the months ahead. I look forward to continuing to work with partners across the health care system to support implementation and measure progress toward a more affordable and sustainable future.”

Danna Mauch, President & CEO, Massachusetts Association for Mental Health

“Affordability means getting people in Massachusetts the right care at the right time in the right place. HCAWG recommendations are designed to improve access and lower costs with a map of feasible actions to address solvable challenges in adoption of care innovation, workforce investments, and technology remedies.”

Cari Medina, Executive Vice President, 1199SEIU

“Every day, healthcare workers experience firsthand the healthcare affordability crisis, as rising costs have pushed patients to delay care and worsen healthcare outcomes. On behalf of 1199SEIU, I am proud to have contributed to recommendations that will help make healthcare more affordable and accessible for Massachusetts residents. By addressing rising costs, it stabilizes the healthcare workforce and protects access to high-quality care in all care settings. These recommendations are an important step forward, and I look forward to continuing this work to ensure that healthcare workers, patients, and our communities have access to care when they need it."

Kendalle Burlin O’Connell, President & CEO, MassBIO

“We appreciate Governor Healey's leadership in bringing together every sector of the health care community to address the shared challenges of affordability and efficiency. By fostering collaboration across providers, insurers, employers, and other stakeholders, this process creates an important opportunity to develop practical solutions that improve access, reduce costs, and deliver better outcomes for patients across the Commonwealth.”

Lora Pellegrini, President & CEO, Massachusetts Association of Health Plans

"MAHP appreciates Governor Healey's focus on practical steps that can help make health care more affordable for patients, employers, and families, including efforts to reduce low-value care, protect patients from excessive out-of-network costs, and encourage broader adoption of existing technology to improve data sharing among providers and payers. These recommendations reflect the kind of system-wide work needed to address the underlying cost of care and represent important progress, but more work remains to deliver meaningful premium relief to consumers. Addressing rising provider prices and prescription drug costs will be critical, and Massachusetts should build on the successful strategies implemented in other states to achieve lasting affordability."

David Seltz, Executive Director, Massachusetts Health Policy Commission

“It is imperative for Massachusetts to take the lead in safeguarding health care affordability and access – and the Governor’s Health Care Affordability Working Group has provided an actionable roadmap for the Commonwealth to do this. The recommendations on primary care investment, innovative care delivery models, and curbing high out-of-network prices, directly align with the policy recommendations and mission of the Massachusetts Health Policy Commission.

“The HPC is proud to support the critical work outlined by the Health Care Affordability Working Group’s recommendations and to continue working with the Healey-Driscoll Administration and our partners across Massachusetts to advance a health care system that is affordable, equitable, and accessible to all residents.”

Matt Veno, Executive Director, Group Insurance Commission

“I am grateful for Governor Healey's leadership in bringing the Health Care Affordability Working Group together at this critical time. I look forward to executing on the GIC's action items with a thoughtful, collaborative, and data-driven approach.”

Steve Walsh, President & CEO, Massachusetts Health and Hospital Association

“Like states across the nation, Massachusetts faces an increasingly complex challenge: improving affordability for patients while protecting the fragile health care system and care those patients rely on every day. We can only strike that balance and find sustainable solutions through sector-wide partnership, and we are grateful for the renewed urgency the Healey-Driscoll Administration has brought to these issues over the past year. Our hospitals and health systems look forward to being a strong resource for state leaders as they work through these recommendations.”

Zhao Zhang, Deputy Medicaid Director, MassHealth

MassHealth has been honored to participate in the working group. The rising cost of health care has put tremendous pressure on communities across the country, here in Massachusetts, and on MassHealth. Governor Healey’s quick actions on this issue are important steps to make health care more affordable, while ensuring Massachusetts residents have access to high-quality care. MassHealth is ready to support.

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