Kevin Sack in today's NY Times reports that Massachusetts is considering a radical revision of the way it pays for medical care:

The recommendations, if approved by the legislature and Gov. Deval Patrick, would make Massachusetts the first state to end the practice of paying health care providers for each office visit, laboratory test or procedure.

Instead, primary care physicians, specialists and hospitals would group themselves into networks that would be responsible for a patient’s well-being and would be compensated with a flat monthly or annual fee known as a global payment.

Which sounds a lot like what Kaiser Permanente used to be like before the boys from the health insurance side got way too much power. It also closely resembles a proposal made in this blog by Wonks Anonymous. This could be implemented if the state were to encourage doctors and hospitals to form producers cooperatives. Which idea was also put forward in this blog.

Although Wonks Anonymous would dearly love to get credit and rewards for these ideas, he has a more important question:

If the producers cooperatives are paid a flat monthly rate - he hopes it will be adjusted to reflect the relative costs of different patients, based on their diagnoses - then they and the state would bear all of the risk of illness. If this is the case then what purpose under heaven will health insurance companies serve?

Other than making profits for their managers and shareholders by extracting tribute from the rest of us.