Published February 17, 2011

Every time you go to the doctor and get a blood test, an MRI, a mammogram or an appendectomy, you pay for it. Actually, if you’re lucky, you have decent insurance and your insurance company pays for it. This is the way American health care has worked for a really long time.

Medical procedures are really expensive, and insurance companies need to make money. So they charge you higher and higher premiums to cover the cost.

Insurance companies bet on people getting sick, so there is little incentive to discourage these pricey procedures. Same with docs and hospitals, as long as they’re getting paid.

This is what people mean when they talk about health care cost containment. Today, Massachusetts Gov. Deval Patrick introduced legislation that would seek to make health care more affordable by fundamentally changing the way we pay for it by 2015.

WBUR’s Martha Bebinger reports:

Patrick’s legislation aims to reduce health care spending by putting most doctors and hospitals on a budget, with bonuses tied to patient health.

“There is no financial incentive in the current system for good care, only for more care,” Patrick said.

A new state council would set rules for so-called global payments, and the administration is requesting more authority to limit insurance rate increases.

If there’s one bit of health-care jargon you should remember right now, it’s global payments. This system would essentially transfer the burden of payment away from the patient. (Also read Martha’s explainer on global payments.)

Critics of this idea say it could result in worse, not better, care, because doctors are less likely to prescribe tests and procedures that might break the budget. People also worry this will hurt choice — a doctor is more likely to insist on the least expensive treatment. Moreover, a lot of people don’t want the government to have so much control over the market — over their health.

Patrick says he will work with a broad coalition of providers, business groups and consumer advocates to get this right.

This is where I yield to the experts at WBUR’s CommonHealth blog, who have done a tremendous job digging into this new bill and explaining what it would mean for you and me. Follow along, and tell us what you think of the idea.