Last week, Connecticut Gov. Ned Lamont and his administration held a press conference nominally to promote their efforts to lower healthcare costs, but mostly for damage control. There’s been understandable criticism of the state insurance department’s decision to trim the unjustified insurer rate increase requests for next year from 20% to 13%. Insurers have been very profitable before, during, and since COVID and 13% isn’t affordable for anyone. But this isn’t the first time the governor and his administration have disappointed us on healthcare.
At the press conference, the governor agreed that the insurers’ requested rate hikes were “outrageous,” and that the insurance department’s trim is “not good enough.” But a mess this big can’t have just one cause. He is right that a big part of the problem is underlying prices for drugs and monopoly health system services. But then they lost me. He and his commissioners only offered tired, old projects that aren’t working, and others that are just bad ideas.
The administration’s big plan to cap the growth of healthcare costs is a name-and-shame report which is likely to be criticized by all sides, making it useless. Over two years in, they’ve learned that huge, monopoly health systems and drug prices are driving up healthcare costs, but we already knew that. Massachusetts has had a similar cost cap in place since 2013, but it hasn’t worked.
The administration also offered their All-Payer Claims Database (APCD), as an achievement. The database should include all Connecticut healthcare payments and is the basis for most of their cap calculations. But the APCD is missing most state residents, including the uninsured, Medicare beneficiaries, Medicaid members, and residents in employer-funded plans. In addition, the APCD’s drug spending data doesn’t include rebates, which vary widely averaging 51% off list prices for commercial plans. All the missing data exists elsewhere but isn’t in the APCD. Bad things can happen when designing policy based on a Swiss cheese database.
Recent and better data, from independent sources who show all of their math, finds that Connecticut is among the best in the nation in controlling overall healthcare costs. We should be very, very careful making changes, or we could wreck what’s working. The law of unintended consequences is very strong in healthcare – especially here in Connecticut.
The administration’s plan to pour an extra $3.9 billion into primary care may be a good idea, but it’s not going to save money. So far, it’s just ignited a feeding frenzy among providers. The state’s regulatory Certificate of Need process that is supposed to rein in healthcare monopolies, keep markets competitive, and control prices, isn’t working at all.
The governor rightly points to federal subsidies to help make insurance coverage affordable through Access Health CT that have been extended for three years. He can take credit for building on those subsidies with Covered Connecticut to expand services and cover out-of-pocket costs. But there are only 11,700 people now enrolled. According to the US Census, there were 163,000 uninsured Connecticut residents in 2020.
I am puzzled that the administration is promoting their health information exchange as a major achievement and cost saver. An exhaustive investigation found that Connecticut’s system is behind schedule, over-budget, and shut down an exceptional system we’d already paid for. They also intend to fund the system by selling access to our sensitive medical records.
The governor kind of buried the best thing he’s proposed to lower costs. Two years in a row, he has proposed taking back extreme drug price increases. Recently, Congress went further and cut drug price increases in Medicare to the rate of inflation. While the Governor’s bill hasn’t gone anywhere, Connecticut will need to pass it next year, or the drug companies may just shift their Medicare losses onto those of us covered by private plans – because they can.
There is a lot the governor can and should be doing to lower healthcare costs if the voters re-elect him. He’s done nothing to lower monopoly health system prices. These price increases are the main driver of rising healthcare costs. They are crushing competition and consumer choices for care. Last year, the state Senate overwhelmingly passed a bill to limit anti-competitive contracting by these huge systems, but it died on the House calendar. The governor should put his weight behind passing this bill. He should also either fix our broken Certificate of Need process, or scrap it.
The governor needs to really get serious about improving health. He needs to go upstream to address healthcare problems. There is growing evidence that the main contributors to our health are not medical. We have to focus on preventing costly conditions by directing resources to safe housing and communities, healthy food, economic security, and proven public health initiatives. The state could have a big role in seeing that medical savings are invested back into the community services that prevented the problems, not captured by huge health systems and insurers.
But mistrust derails even good ideas and Connecticut’s healthcare system has trust issues. This governor didn’t create them, but he needs to acknowledge and fix them if we have any hope of making progress. Use evidence and good data to guide solutions and evaluate outcomes. Be wary of convenient myths and shiny new health policy fashions that don’t work. Listen to everyone – good ideas come from unlikely places. Don’t let petty politics or turf battles get in the way of doing the right thing. We need our next governor to succeed.