Transcript Health Reform in Minnesota: An Overview of Recent Activity

Health Reform in Minnesota:
An Overview of Recent Activity
Scott Leitz, Assistant Commissioner
Minnesota Department of Health
July 31, 2008
Overview
Some Minnesota context
Commission and Task Force work
Health Reform components
Next Steps
Minnesota starts from a
reasonably good place
 Nation’s lowest uninsurance rate
– Strong employer base
 Ranked as one of the top 2 or 3 healthiest
states
 History of collaboration and innovation in
the health care delivery system
– Largely non-profit environment
– High concentration of large, integrated, multispecialty group medical practices
– Institute for Clinical Systems Improvement
– Minnesota Community Measurement
– Active large purchasers
Minnesota starts from a good
place: MinnesotaCare
MinnesotaCare subsidized insurance
program (since 1992, pre-SCHIP)
– Subsidized coverage for parents and
kids to 275% FPG
– Single adults and childless couples to
250% FPG
Relationship between Quality
and Medicare Spending
The Context for the Health Reform
Discussions in Minnesota
In spite of our relatively good starting
point:
– Rising health care costs in the state are
unsustainable
– Our health care system creates poor value
and has misaligned incentives
– Private insurance continues to erode, and the
number of uninsured is rising
– Health care quality is low relative to the
amount spent, and unevenly distributed across
the population
– The way we pay for health care services leads
to distortions in the types of health care that
gets delivered
Total Health Care Spending in
Minnesota up 50+% in 5 years
$35
$30
$25.9
Billions
$29.4
$23.4
$25
$20
$27.4
$19.3
$21.1
$15
$10
$5
$0
2000
2001
2002
2003
2004
2005
Percent change from previous year
Health care cost growth in Minnesota
outpaces growth of the overall economy
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
1995
1996
Health care cost
1997
1998
1999
2000
Per capita income
2001
2002
Inflation
2003
2004
2005
2006
Workers' wages
Notes: health care cost is MN privately insured spending on health care services per person, and does
not include enrollee out of pocket spending for deductibles, copayments/coinsurance, and services
not covered by insurance..
Sources: Health care cost data from Minnesota Department of Health, Health Economics Program; per capita
personal income from U.S. Department of Commerce, Bureau of Economic Analysis; inflation data from
U.S. Bureau of Labor Statistics (consumer price index); workers’ wages from MN Department of Employment
and Economic Development
Minnesota Diabetes Care
Improving but only 1 in 7 receive optimal care
Percent of diabetics receiving optimal diabetes care
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
4%
6%
10%
2004
2005
2006
Source: MN Community Measurement Health Care Quality Report
14%
2007
Percent of Minnesotans who are obese
25%
20%
15%
10%
5%
0%
1990
1996
Source: Behavior Risk Factor Surveillance System
2000
2004
A different type of Minnesota
innovation….
A different type of MN
innovation – food on a
stick at the State Fair.
Pictured: Deep-fried
spaghetti and
meatball combination
– on a stick
Sources of Insurance Coverage
in Minnesota, 2001 and 2007
100%
6.1%
7.2%*
21.1%
25.2%*
90%
80%
70%
4.8%
5.1%
60%
50%
40%
68.0%
62.5%*
30%
20%
10%
0%
2001
Group
Individual
2007
Public
Uninsured
Source: Minnesota Health Access Surveys, 2001 and 2007 (preliminary). Estimates that rely solely on household
survey data differ slightly from annual estimates that include both survey and administrative data.
Health Reform Activity
Groundwork laid during 2007
legislative session
Reform task force work
2008 Health Reforms
2007 Legislative Groundwork
Expanded MinnesotaCare coverage for
single adults and childless couples
from 175% of FPG to 215%
Funded a biennial health insurance
survey of Minnesotans
Mandated that all health providers
have an interoperable EHR by 2015,
and funded EHR grants to rural and
safety net providers
2007 Legislative Groundwork
Required that all payers and providers
use electronic methods for all claims
and eligibility transactions; no paper
after 1/15/2009
Required standardized hospital
community benefit reporting
Established the Governor’s Health
Care Transformation Task Force
2007 Task Force and Commission
Work
 Legislative
 Governor-appointed
 Both reports included recommendations to:
– Improve population health
– Better coordinate care for those with chronic and
complex health conditions
– Make advances in coverage
– Improve transparency
– Lower administrative cost
– Better involve the patient and individual
– Reform how we pay for health care
Guiding Principle:
Health Care Reform must:
Improve the health of all
Minnesotans and transform the
delivery system to improve the value
of health care
– Access important, but improving system
value is a critical means of assuring
sustainable access initiatives
2008 Health Reforms
Governor Pawlenty signed health
reform bill in May 2008
Bill is a comprehensive health care
package making significant advances
for Minnesotans
Overview of Health Reform Bill
Key Elements
Public health improvement
Health care coverage/affordability
Chronic care management
Payment reform and price/quality
transparency
Administrative efficiency
Health care cost measurement
Public Health Improvement
Invests $47 million in community-based
efforts to reduce rates of obesity and
tobacco use
Builds on current CDC-funded pilots
Health Care Coverage and
Affordability
Expands eligibility for MinnesotaCare
for adults without children to 250% FPG
– Increases outreach and streamlines enroll.
Tax credits (20% of premium) for
uninsured to purchase coverage (using
125 plan)
Requires employers 11+ to establish
section 125 plans
– Provides grants to employers to cover
cost of 125 plan establishment
Tax or direct ESI subsidy study
Chronic Care Management
Promotes use of “health care homes”
to coordinate care for people with
complex/chronic conditions
MN Departments of Health and Human
Services develop standards of
certification for health care homes
Care coordination payments to health
care homes
Payment Reform and Price/Quality
Transparency
Common quality measures and single
statewide
Transparent ranking of providers on
relative cost, quality, and resource use
Promotes transparency and
accountability by establishing
commonly defined “baskets of care”
Administrative Simplification
Expands on existing 2015 EHR
mandate by requiring that EHRs be
CCHIT certified
Requires that all prescriptions be
ordered electronically by 2011
Study of reducing claims adjudication
costs by moving to a uniform claim
interpretation and single prices
Health Care Cost Containment
Measurement
 Requires health care cost savings to be
measured against projected costs without
reform
 Results in significant potential overall health
care cost savings
– Estimated to have the potential for cost savings
of about 12 percent by 2015 or about $6.9 billion
Moving Forward
 2007 and 2008 reforms:
– improve affordability
– expand coverage
– invest in improving the health of the public
 Continued interest in payment reform,
including total cost of care models
 Continue movement of data from proprietary
tools to publicly available information for
group purchasers and consumers
Contact Information:
Scott Leitz, Assistant Commissioner
Minnesota Department of Health
[email protected]
651-201-3565