Connecticut’s next Governor will inherit a daunting budget deficit and will have to make hard decisions about what programs to fund and where to cut spending. But there is some good news in the area of health care. Connecticut can learn from the experience of other states, programs and employers that buy health care and are finding ways to save money that don’t harm people and actually improve the quality and delivery of care.
Below are fifteen cost-saving proposals. Many could be implemented today, delivering hundreds of millions in savings for the state this budget year. Some require investment, but national health reform includes unprecedented opportunities for funding. Many require a new attitude, working with providers and consumers to improve care.
There is no shortage of partners in our state eager to work with the new administration to both ease the budget crisis and to improve health care. The sooner we begin the work, the better.
1. Implement patient-centered medical homes for every member of state coverage plans. Medical homes coordinate fragmented services and give patients the tools they need to improve and maintain their own health status reducing hospitalizations and emergency room use. National health reform includes several funding opportunities for states to implement patient-centered medical homes. Patient centered medical homes in other states have saved between $71 and $530 per person per year.
2. Implement Primary Care Case Management 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) would provide Connecticut taxpayers with over $40 million in savings each year. National health reform includes a provision providing 90 percent matching funds for care management services for Medicaid recipients with chronic illnesses.
3. Recover overpayments to HUSKY HMOs. $50 million in HUSKY HMO rate overpayments were identified last year in an independent audit by the Comptroller’s Office; the state Department of Social Services (DSS) has yet to reduce HMO rates.
4. Move HUSKY to self-insurance. Last year’s state budget included over $76 million in savings by moving HUSKY from the current fully insured arrangement to an Administrative Services Organization model, however DSS has not implemented this change.
5. Rebid HUSKY and all state health care purchasing on a regular basis. The state employee plan, like most large purchasing pools, is rebid every three years to ensure the state is getting the best possible price for services. DSS should rebid services for the HUSKY program on a regular basis.
6. Build robust wellness programs for state coverage plans. Every dollar spent on wellness programs returns $3.27 in reduced medical costs and $2.73 in reduced absenteeism. Connecticut could save $43 million for state employees alone.
7. 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. The successful Medicare Senior Patrol program developed by the US Administration on Aging provides an important guide.
8. Expand urgent care center and retail clinic capacity. A recent study found that between 14 and 27 percent of all emergency department visits could be safely provided at urgent care centers or retail health centers costing less than half the cost of care in emergency departments.
9. 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, paying for episodes, or bundles, of care and eventually making risk adjusted global care payments. National health reform includes several funding opportunities for payment reform models.
10. Promote and require the use of health information technology tools for all state coverage programs and for physician licensure.
11. Use transparency and market forces to improve cost effectiveness of care by giving consumers comparative quality and cost data. Maine, Pennsylvania and Minnesota have led states in developing publicly available comparisons among providers based on quality and cost data allowing payers and consumers to choose the best value for their spending.
12. Reduce prescription drug costs with a provider education campaign, limit gifts to providers from drug companies, require disclosure of all financial ties between providers and suppliers and prohibit direct industry funding of provider training. Much can be done to encourage generic drug use and mail order delivery savings.
13. 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.
14. Assess areas of over and under capacity in Connecticut’s health care workforce. Health care workforce shortages are significant drivers of skyrocketing costs, while there is evidence that an over-abundance of physicians in an area can increase costs.
15. Develop a public education campaign about appropriate health care treatment. Consumers facing an increasingly complex health care environment can be misled by interests threatened by reductions in profits. A coordinated, thoughtful campaign to educate consumers about the dangers of overtreatment, that more care is not always better, to counter misinformation about “rationing” and gatekeeping, and the benefits of coordinating health care through a patient-centered medical home will engage consumers in improving the effectiveness and value of health care.
Ellen Andrews is the executive director of the Connecticut Health Policy Project.