Ohio Health Policy Review

HPIO interim director: Medicaid could cost state extra $1 billion in 2012

Testifying at Tuesday’s hearing of the state Budget Planning and Management Commission, Health Policy Institute of Ohio Interim Director Greg Moody told the bipartisan legislative panel that unless the federal government provides more funds or the state takes action, the Medicaid program is going to cost Ohio an additional $1 billion from 2011 to 2012 (Source: “Medicaid to add $1 billion to state budget quandary,” Columbus Dispatch, July 20,2010).

And this comes at a time when the state is already expected to face a budget shortfall estimated at between $5 billion and $8 billion.

Moody said his projection is based on the assumption that federal matching funds, which were increased as part of the federal stimulus package last year, return to normal levels and the state experiences a 6.1 percent increase in spending, as projected by the Congressional Budget Office. Moody's presentation is available here (pdf, 10 pages).

While unlikely to remedy short-term budget challenges for the Medicaid program, Moody outlined a series of cost containment strategies that could reduce long-term costs for the program:

• Focus on prevention and primary care
• Care coordination and disease management
• Price and quality transparency
• Payment reforms that reward value
• Behavioral/physical health integration
• Rebalance Medicaid long-term care

Another speaker at the hearing, John Begala, executive director of the Cleveland-based Center for Community Solutions, said among the short-term options that the state may consider are capping hospital payments and reducing the 12.5 percent administrative allowance for HMOs. Those recommendations were included in Community Solution’s recently published report on the state budget, “Thinking the Unthinkable: Finding Common Ground for Resolving Ohio’s Fiscal Crisis.” (pdf, 50 pages)

HHS awards Ohio $3 million for home visitation program

Ohio is set to receive about $3 million in federal funds for programs that provide home visits aims at reducing pre-term births, according to an announcement from the Department of Health and Human Services (Source: "Home Visit Programs To Receive Millions,” HealthLeaders Media, July 22, 2010).

Only three states (Idaho, New York and Texas) and the District of Columbia are set to gain a larger share of the $88 million that were made allocated in health reform legislation. The money is to be used to fund evidence-based programs that enable nurses, social workers and other health professionals to visit at-risk families in their homes, according to an HHS release.

Survey: Central Ohio Doctors pessemistic about health reform

An online survey conducted by the Columbus Dispatch and WBNS-TV in Columbus, with the assistance of the Ohio State Medical Association, found that nearly three-quarters of Central Ohio doctors who responded expressed pessimism about the impact of federal health on health-care delivery (Source: “Doctors wary of changes in health care,” Columbus Dispatch, July 18, 2010).

Seventy-eight doctors responded to the online survey and 58 (74 percent) said health-care delivery will be “somewhat worse” or “much worse” after health reform. The results of the survey are not scientific.

Insurers testing new plans that reduce cost, restrict choice of doctors, hospitals

Insurance plans have begun testing new plans with reduced premiums that limit participants’ choices of doctors or hospitals (Source: “Insurers Push Plans That Limit Choice of Doctor,” New York Times, July 18, 2010).

The plans may be especially appealing to small businesses struggling with the spiraling cost of coverage, but are also garnering interest from larger employers as well.

“What we’re seeing is a definite uptick in interest because, quite frankly, affordability is the most pressing agenda item,” said Dr. Sam Ho, the chief medical officer for UnitedHealth’s health-care plans.

Insurers anticipate that the lower-cost plans will be popular with individuals and small businesses who will purchase coverage in the insurance exchanges that will take effect in 2014.

Commonwealth report outlines key policy issues for insurance exchanges

The Commonwealth Fund released last week a report on state insurance exchanges that outlines areas of consideration for policymakers as they begin setting up state insurance exchanges.

The report, Health Insurance Exchanges and the Affordable Care Act: Key Policy Issues, describes 13 key areas for policymakers to consider.

“Health insurance exchanges are the centerpiece of the private health insurance reforms of the Affordable Care Act of 2010 (ACA),” the report states. “If they function as planned, these exchanges will expand health insurance coverage, improve the quality of such coverage and perhaps of health care itself, and reduce costs. Previous attempts at creating health insurance exchanges, however, enjoyed only mixed results.”

Health Affairs, RWJ release brief on extra Medicaid funding to states

Health policy journal Health Affairs and the Robert Wood Johnson Foundation have published a new brief that examines whether the federal government should extend its temporary increase in contributions to states for Medicaid funding.

The brief, titled Extra Federal Support for Medicaid, examines how the additional FMAP contributions have helped offset state deficits, since most state budgets by law must be balanced. It also includes proponents' and opponents' views, in particular the debate between the necessity to avoid serious harm to state budgets versus the impact on the federal deficit if the additional assistance isn't offset with spending cuts or revenue increases.

Northeast Ohio health systems begin work developing ACO models

Two Northeast Ohio health systems — Summa Health System in Akron and University Hospitals in Cleveland — have begun working with  National group purchasing organization to create accountable care organizations aimed at improving coordination of care and reforming the way providers are paid (Source: “Alternative to HMOs coordinates treatment delivery,” Akron Beacon Journal, July 5, 2010).
 
Under the ACO concept, doctors and hospitals would get financial incentives to work together to keep patients healthy and out of the hospital. The partners would coordinate their care and then share in any savings if quality and cost goals are achieved. Federal health reform legislation allows for ACOs through Medicare, beginning in 2012 . Under the law, patients in traditional Medicare will be assigned to an ACO if their normal provider participates.

Mansfield public health program a model for federal reform provision

U.S. Sen. Sherrod Brown visited Mansfield this week to highlight the work of the Community Health Access Project, a county health worker program that serves as a model for a provision in the federal health reform legislation that passed in March  (Source: “Local program a model for nation,” (Mansfield) News Journal, July 7, 2010).

Started in Mansfield in 1999, CHAP was expanded to rural Knox County in 2000 and involves facilitating visits by county health workers to populations that experiences high rates of low-birthweight babies. The program estimates that in its first three years of operation, the number of low-birthweight babies in the region declinded 22.7 percent.

Sen. Brown pushed for inclusion of a grant program in the federal legislation that will fund programs modeled after CHAP.

HPIO releases fact sheet on impact of national reform on Ohio's uninsured

As Ohio policymakers continue to implement national health reform, the Health Policy Institute of Ohio is planning to publish a series of Health Reform Fact Sheets. Over the next six months, HPIO will be releasing the short papers designed to describe the Ohio-specific impact of national reform on coverage, provider capacity, delivery system reform, information transparency, and State resources. The latest of these, finished this week, addresses Ohio’s uninsured and how they will be impacted by reform.

HPIO also has released its National Health Reform Framework — a one-page summary of implementation priorities that can be used by HPIO and others as a starting point for more detailed discussions about the challenges and opportunities related to reform.

In addition, HPIO also has created a presentation,"What Reform Means for Ohio," that describes national reform, implementation challenges, and opportunities for Ohio to improve health system performance (this presentation is ideal for strategic planning — please contact Jill Huntley at 614-224-4950 or jhuntley@healthpolicyohio.org if you are interested in scheduling Greg Moody, HPIO Interim Director, to present at your organization and/or facilitate a discussion on the impact of reform).

Ohio picks Medical Mutual to run high-risk pool

The Ohio Department of Insurance last week announced that it has chosen Medical Mutual of Ohio to operate the state’s temporary high-risk insurance pool (Source: “Medical Mutual to run state's high-risk pool,” Columbus Dispatch, June 26, 2010).

Federal reform legislation passed in March requires a high-risk pool in every state so that those with pre-existing medical conditional can purchase insurance. The pool will operate until 2014, when a state-managed insurance exchange will be established.

In its proposal, Medical Mutual, a nonprofit company, estimated that it could cover more than 5,000 Ohioans through the duration of the program, with individuals paying a standard premium for their coverage. No state funds will be used to provide this coverage.

At the same time, a new nationwide program designed to help people turned down for health coverage because of preexisting health conditions launched Thursday, which will be used by residents of the 21 states that opted against setting up a state-run high-risk pool (Source: "Obama administration unveils government health-care Web site," Washington Post, July 1, 2010)

The Obama administration unveiled on Thursday a new website, www.healthcare.gov,  where people who’ve been turned down for health coverage can go to find new options until the health-reform law’s major provisions take effect in 2014.