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Mass retreat: the demise of Massachusetts hospital rate regulation.

Massachusetts recently deregulated its 16-year-old hospital rate regulation system, after earlier voting in favor of a delay of its "play-or-pay" universal health care mandate. This retreat holds important lessons for the rest of the nation. Specific flaws in the design of the system weakened regulation's effectiveness and undermined its political support. The failure to control costs led to the postponement of universal access. Massachusetts' experience illustrates that neither competition nor regulation--as currently practiced--are adequate to meet the access and cost control challenges facing the nation.