A fix for health care
The Colorado Commission on Affordable Health Care has wrapped up its three-year study of rising health care costs in the state, adding key recommendations in four areas to complete a comprehensive list of factors in need of action or further study.
The 100-page final report, to be delivered to the governor and the Legislature, considers everything from utilization rates in rural health-care markets to drug costs to consumer confusion over free-standing emergency rooms.
Cost factors are woven together so tightly that pulling on any single thread implicates every other thread in the system, members of the commission told the Sentinel’s editorial board Friday. A combination of government intervention and self-motivated changes in the private sector must occur in tandem to bend the cost curve — neither of which is likely without strong leadership.
The commission’s work is too detailed to condense here, but it’s too important to sit on a shelf and gather dust. The report recommends state legislation where appropriate, identifies market forces for activities in the private sector that could lower costs and recommends lobbying the state’s congressional delegation on issues beyond the purview of state government, such as regulation of the pharmaceutical industry.
The debate over health-care reform raging on Capitol Hill has little bearing on the commission’s findings. The discussion that’s occurring in Washington, D.C., deals with access to coverage and the payments and funding of programs related to it, which generally have very little impact on the costs of the care being provided.
This report focuses on the cost of care and one idea that we think bears further contemplation is Maryland’s all-payer model equalizing hospital reimbursement rates, which has saved the state more than $1 billion since it was implemented.
Under Maryland’s 36-year-old Medicare waiver, all third parties pay the same rate, eliminating the “cost-shift” that results in more expensive care for the commercially insured.
The federal government agreed to let Maryland set rates for hospital services. The federal government pays more per visit for Medicare and Medicaid patients with the understanding that its overall costs will be equal to or less than what it would pay anyway under the national model. It means doctors have to look at a more efficient way to render care. That, in turn, affects levels of utilization for imaging, lab work, prescriptions, etc. — which drive costs — and puts a premium on keeping patients healthy.
While promising both in terms of cost containment and quality of care, pursing such a model in Colorado would have significant up-front costs and require intricate negotiations between government and the private sector.
Which brings us back to the leadership question. The commission had provided a road map to cheaper, better care but it’s going to take lawmakers, policy wonks, insurers, regulators, patient advocates, doctors and hospitals working together to choose a common path — one that put greater emphasis on patient outcomes than profit margins.