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Consumers for Affordable Health Care's Initial Analysis of the May 26, 2004
Draft State Health Plan
Last updated on 5/26/04

Overall

  • CAHC supports the draft of Maine's State Health Plan. We would like to commend all parties that have been involved in its development and look to it as the first significant step in bringing vested interests out of the "silos" and "bunkers" that we have all inhabited for much too long in order to successfully implement it.
  • Maine needs a state health plan and we need it now.
    • Maine needs to move forward as quickly as possible in implementing the interim plan since it is essential in moving some pieces of the Dirigo Health reform legislation forward - especially its role in guiding the Certificate of Need process that helps to contain rising health care costs and deploy expensive technologies and new construction appropriately.
    • We recognize that this plan is a work in progress - a framework that will work as a base from which to build the more comprehensive, biennial state health plan over the next year. We would like to provide comments that serve to clarify or build upon the contents of the draft.

Part 1. Introduction

  • We fully support the purpose of the state health plan - "to strategically improve the allocation and coordination of our health care resources to help Mainers become the healthiest people in the U.S."
    • Many businesses and individuals in Maine are currently struggling to afford health care. Health care costs are growing at an extraordinary rate and many small businesses are suffering the consequences of these escalating costs.
    • This is not just a problem for these businesses and individuals that cannot afford care - this is a problem that affects us all. The data, as well as the personal stories, make it clear that we are not getting what we pay for, as spending more has not translated into improved health or better access to care - everyone in the state needs to be committed to equal access to health care and better health for all.
  • We need a state health plan to set priorities and goals that will allow us to achieve the goals set out under the Dirigo Health reform. The time for this plan is now! We cannot afford to delay implementation of this interim plan.
  • We look forward to being part of the process over the next year to develop the biennial plan and hope that every citizen realizes the importance of this plan and makes an effort to be involved.

Part 2. One-Year State Health Plan

Section 1. Maine's Major Health Issues

  • The objective that addresses reducing emergency room usage, should include an intervention to expand after-hour care, call hours for telephone advice and e-consultation, and open scheduling are a few of the methods to address this issue. It should be noted that providers should be compensated for some of the alternative methods of delivering care. For example, BCBS of Massachusetts now compensated physicians for electronic consultations. Such consultations reduce costs to the overall system.
  • An objective that addresses racial and ethnic disparities should be added to this section.

Section 2. Cost

  • A multi-faceted strategy needs to be developed to control rising health care costs. Parts of this strategy need to be aimed at each of the major health care cost drivers.
    • The draft State Health Plan appropriately places an emphasis on the costs of care at Maine's hospitals, given that hospital costs make up the largest portion of health care costs. However, the overall strategy needs to address all cost drivers and expand beyond hospitals. Certificate of Need plays an important role but other strategies are needed that focus on insurance medical loss ratios, pharmaceutical costs, administrative waste, and non-hospital costs.
  • The CON program needs to be improved and strengthened. The following are suggested recommendations for strengthening the program:
    • The CON program should be guided by specific criteria that tie program decisions to the goals outlined in the State Health Plan;
    • The CON program should be monitored on an ongoing basis to track the effect of approved projects on costs and quality, with mechanisms available to correct problems, as needed;
    • Staffing of the CON Unit should be increased;
    • The CON Unit needs to employ or purchase economic and financial expertise;
    • The state should consider lowering the dollar amounts that trigger CON review;
    • The CON Unit needs to be organizationally relocated within the Department of Human Services;
    • The decision-making process should adopt APA procedural safeguards and employ an independent, impartial hearing officer whose decision is informed by health status and financial analyses prepared by the CON Unit staff;
    • The independent, impartial hearing officer should make a recommended decision that is submitted directly to the Commissioner of DHS to be approved, approved with modifications, or rejected.
  • Health insurance has become too stratified and segmented. Insurers artificially segment risks by "size" of the group. Separating risks by size of the group runs counter to the purpose of insurance, that is, to spread risks and their attendant costs as broadly as possible in order to lower costs for all. The costs of maintaining these administrative structures are unnecessary and could be eliminated by requiring insurers to combine their risk pools.
  • Health insurance medical loss ratios (how much an insurer pays out in coverage) should be posted by company and by line segment of insurance. These "payout" rates should also be conspicuously reported to consumers shopping for insurance. Pricing strategies used in this highly monopolized industry in Maine have forced many, especially those in the non-group market, to pay more and get less. Medical loss ratios should be increased for the non-group and small group market in order to increase efficiencies, return more premium dollar to the purchaser, and gain equities for non-group and small groups.
  • Health insurers should be required to post the annual dollar amount contributed by their Maine customers to the consolidated corporate earnings of their out-of-state owners.
  • Pharmaceutical prices are still too high. As a significant and growing component of health care costs, more effective strategies are needed. In the short term, these strategies should include participation in interstate and intrastate purchasing arrangements, pushing for our Congressional delegation to support re-importation of drugs from other countries that are willing to exercise their government's bargaining power to the advantage of its
    citizens, and efforts to limit direct-to-consumer advertising and company offered bonuses to physicians and other providers.
  • The state government should supervise and enforce cooperative arrangements between and among hospitals and non-hospital facilities to ensure that services, facilities, new and expensive technologies, and trained staff are shared to the greatest extent possible in order to lower costs and improve quality of care. Mapping facilities, equipment, personnel, operating rooms, and other capacities between and among providers (described below) will help to guide the CON process and inform government on how to assist providers in addressing the barriers to cooperation that have been created by "anti-trust" concerns.
  • The state government should use its charitable trust authority to ensure community health services required by charitable missions are being delivered and that these community health services are at least proportionate to the dollar amount of benefits gained under non-profit tax exempt laws.
  • Greater efforts should be made to reduce direct-to-consumer advertising by mission-driven, non-profit charitable institutions that create "demand" for more, but often ineffective, services.
  • Almost all countries in the world that guarantee health coverage to all of their citizens employ global budgets and expenditure targets. These "planning driven" - not "expenditure-driven" - processes enable the cost-effective, quality care to be available to all of their populations, not just those privileged by a well-paying job that offers coverage.
  • An overall state health global budget with specific expenditure targets is needed now. We should not have to wait until July 2005 for the adoption of some version of such budgets and targets. We have experienced one year of such targets on a voluntary basis. CAHC believes that data is available now that would support the adoption of an interim global budget that reduces the growth rate in spending to much lower levels without jeopardizing the quality or availability of care. As an interim measure, we would encourage the adoption of a budget and targets that slow the growth rates in spending to make care more affordable for Mainer and, in particular, for individuals, vulnerable populations and small businesses.

Section 3. Quality

  • In collecting data on quality of care, data should also be collected on patient safety indicators. There should be an increased level of effort around monitoring and reporting on patient safety data. This information should be made available to health care consumers, so that they can use it to guide their decisions.
  • The state should consider providing encouragement or incentives to increase the ratios of nurses to patients to improve quality of care in a cost-effective manner.
  • Since there is a body of research that finds that higher costs do not necessarily correspond to higher quality of care, an effort should be made to collect and combine quality and cost data for the state of Maine.
    • Similar to the strategy to develop a resource inventory under "Section 4. Access," data on quality of care should be collected and mapped out and combined with data on cost of care. This "data map" should be made available to consumers to be used to guide decisions about where to obtain care. Consumers can use this information as a tool to obtain the highest level of care at an affordable cost.

Section 4. Access

  • Overall, this one-year interim state health plan does not include much on emphasis on access.
  • MaineCare expansions have provided insurance coverage to many citizens who previously qualified for free care. This coverage serves to reduce uncompensated care costs incurred by providers.
  • Dirigo Health and additional MaineCare expansions will provide more uninsured and underinsured with coverage up to higher levels of the federal eligibility guidelines. Therefore, institutions and facilities required to offer free care should, in turn, be required to increase the eligibility levels for free care.
  • Access to care is often determined by geography. One's location may dictate when and where one can obtain care. For example, in rural settings the lack of after-hour care and open scheduling often results in the use of hospital emergency rooms after normal business hours, on weekends and holidays. This should be addressed in reallocation of dollars using the global budget planning process outlined below.
  • The lack of emphasis on access is likely due to the fact that there is currently not much data available related to the issue of health care access in Maine.
  • The introduction of this section defines access much more broadly than insurance status or socioeconomic status, however, the objectives only address these two factors related to access.
    • Access is a broad concept that can include ability to pay (socioeconomic status), where you live (geographic access), the color of your skin (racial and ethnic disparities), the language you speak, your mental health status, your age, your sexual orientation, your gender, and veteran status.
    • Access is also broader than access to direct health services - also access to things that promote/support better, overall public health, including access to education and information.
    • In the biennial plan, objectives need to be established that address these broader factors related to access.
  • While the development of a resource inventory by region is a start in building up the data related to access that is currently available, the resource inventory needs to include technology, as well as providers.
    • This "supply-side" information needs to be mapped out and combined with data on the demand side about service needs.
    • This map should then be used to identify deficiencies and opportunities for collaboration within the entire health care system and can also be used to help guide the CON decision process.

Part 3. Process for First Biennial State Health Plan

  • While we generally support the five basic components of the planning process, the effectiveness of this process in developing a health plan that represents the entire state and has wide support depends largely on the details of these components which are not provided.
    • In order for everyone in Maine to work together to meet the goals of the state health plan, there needs to be statewide "buy-in." Thus, it is important to ensure wide and diverse public involvement, including all types of stakeholders and not solely "the usual suspects."
  • It is important that the State Health Plan is sustainable. Part of this involves wide "buy-in." Another part includes allocating resources to oversee and carry out the plan. Part of the planning process needs to identify available resources to ensure the plan's success. For example, who or what entity is responsible for the plan? How is the continuation of public involvement in updating the plan going to be established? What entities are responsible for maintaining the data and "keeping it current"?

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