Blue Cross Blue Shield of Massachusetts announced it wants to replace the system of paying providers for each visit or treatment, with flat annual payments per patient.

The company issued its statement as a reaction to a recent report of increasing healthcare costs in its state, which it commissioned from research firm InterStudy, Nashville, Tenn.

The state Blues said that despite what it considers a successful first year, the Commonwealth Care and Commonwealth Choice program of universal health care faces rising costs and higher-than-expected enrollment.

The Blues also released a lengthy set of proposals, including a mix of legislative and voluntary measures, designed to target rising costs.

Its proposals included public reporting and non-billing of preventable errors, administrative simplification, efforts to reduce nursing shortages, and a chronic diabetes disease-management program.