The author of this editorial is the executive director of the Connecticut Health Policy Project.

For more than a year, with the economy in recession and tax revenues dropping, Connecticut’s elected officials and policymakers have struggled to find ways to balance the state budget. The Democratic-controlled legislature battled throughout the summer with Governor Rell over spending cuts and revenue increases before reaching an agreement in early September. Unfortunately tax revenues have continued to decline and the state faces a further $600 million-plus deficit this year. Policymakers are again looking for spending cuts in an already lean budget.

In February, the CT Health Policy Project urged the Governor and the Legislature to use these difficult economic times as an opportunity for innovation and creativity, to find new and better ways to deliver health care and services to families and individuals that would save money while preserving care.

While some new ideas and programs were included in the budget negotiations, including denying payment for serious medical errors and adjustments in state employee health benefits, many good ideas remain to save money and improve health care in Connecticut.

1.Implement PCCM statewide for the HUSKY program. Committing attention and resources to ensure a robust program that attracts providers and consumers, is accountable for outcomes, serves as honest competition to the HUSKY HMOs (motivating them to perform) and saves money. PCCM not only saves money but invests in primary care and care coordination, sorely needed capacity in Connecticut.

PCCM has been implemented and is saving money in thirty other states. Connecticut has implemented this important program in Waterbury and Willimantic only. The state has also set several artificial barriers to participation for both consumers and providers, including a failure to devote   resources equal to those committed to HUSKY HMO, and an unwillingness to accept assistance from advocates offering help with recruiting providers and consumers.

2.Recover the $50 million annual overpayments to HUSKY HMOs revealed in the Comptroller’s audit of HUSKY rates. These savings were proposed by the Governor for the FY 2010 and 2011 budgets, approved by the General Assembly and are included in the final budget. However, DSS has yet to reduce HMO capitation to reflect the savings.

3.Provide coverage for smoking cessation medications and counseling in Medicaid.

4.Limit HMO administrative costs. Other states have passed legislation limiting medical loss ratios to 75 percent (insurers may only spend up to 25 percent of premiums on administration and profit). The House version of national health reform limits insurers’ medical losses to 85 percent.

5.Implement payment reform for all state health care purchasing and support all-payer initiatives to reduce overutilization and pay for quality. This includes a variety of initiatives implemented in other states such as pay-for performance for both providers and managed care plans, paying for episodes, or bundles, of services in one payment across the care continuum rather than paying fees for each individual service, and eventually making global care payments for individuals, risk adjusted to account for varying levels of need.

6.Implement patient-centered medical homes for every member of state coverage plans. Medical homes coordinate fragmented services and give patients the tools and support they need to improve and maintain their own health status. Medical homes reduce the need for specialty care, improve access, reduce duplicate tests, reduce unnecessary and conflicting medications, keep people out of emergency rooms, and improve patient safety by strengthening the patient-provider relationship and by emphasizing primary care and prevention.

7.Promote and require the use of health information technology tools, including provider electronic medical records and consumer personal health records, for all state coverage programs. Support the development of a secure, private, user-friendly health information exchange for all state residents. The pilot health information exchange being developed by eHealthConnecticut for Medicaid recipients could serve as a template for the state.

8.Use transparency and market forces to improve cost effectiveness of care by providing consumers with comparative quality and cost data, using successful models from other states.

9.Reduce prescription drug costs with a provider education campaign, on the relative costs and effectiveness of medications; limit gifts to providers from drug companies; require disclosure of all financial ties between providers and suppliers; and prohibit data mining, or the purchase of consumer prescription records, for marketing and commercial purposes.

10.Expand public health programs that give patients tools to take responsibility for their health including care coordination, disease management, risk assessments, disease screenings and immunizations on a community level to prevent disease and manage chronic illness. Connecticut’s program providing free nicotine replacement therapies was overwhelmed and had to be shut down early because demand outstripped the budget. Vermont’s Blue Print for Health can serve as a template for Connecticut.

11.Build all-payer data systems that monitor quality, support care coordination, reduce duplication of services and medical errors. Support providers in using their data to improve performance and support payers in using the data to reward value and efficiency.

12.Assess areas of over and under capacity in the health care workforce, develop a strategic plan to address shortages and surpluses. The nursing shortage has been a significant driver of hospital costs, in particular, while there is evidence that an over-abundance of physicians in an area can increase costs. As our population ages, chronic diseases multiply, and the practice of medicine changes, it is critical that Connecticut monitor and regulate its health care workforce.

13.Create a shared-savings plan for all state coverage plans to engage consumers in both identifying and reporting fraud, waste and abuse and in generating ideas for innovation. Use the “wisdom of crowds” and the network of hundreds of thousands of consumers to drive improvement.

Some of these ideas would reap rewards immediately, even retroactively, and others would be investments for the future. Some are very simple and require only minor changes to state contracting and on-going negotiations, others require careful planning. But all require state policymakers to open their minds to new possibilities, engage consumers and advocates rather than treat them as hostile, and look to other states for guidance and best practices. We have exhausted the old, familiar options of cutting programs and shifting costs onto low income consumers. It is past time for the state to move beyond the easy fixes and get smart about repairing our health care system.