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The Attorney General’s second annual report examining cost drivers in the Massachusetts healthcare market with specific focus on the cost containment resulting from the inclusion of global payments. The study found continue wide price variation between providers not explained by differences in quality of care, globally paid providers do not consistently lower total medical expenses, total medical spending is higher for people with higher incomes, tiered network products have increased consumer engagement in value-based purchasing decisions, PPO products produce significant barriers to providing coordinated care and providers designed around primary care and global payments may encourage coordinated care; however, global payments pose significant challenges.
This WBUR article reflects on the Attorney General’s new findings that global payment reform may not result in lower total medical expenses, as expected. In reality, the reform has led to increased health costs, increasing payments to two provider groups by more than 26 percent between 2008 and 2009. Wide price disparities continue to exist within the Massachusetts healthcare market and are based on providers’ reputation rather than quality differences. Despite the increases observed, insurers believe cost savings may be observed in the long run.
A Michigan regional collaborative improvement program, which was paid for by a large private insurer, yielded improvements for a range of clinical conditions and reduced costs in several important areas, according to Health Affairs. For example, general and vascular surgery patients in the Michigan Surgical Quality Collaborative experienced a 2.6 percent drop in surgical morbidity rates. That translates to approximately 2,500 fewer Michigan patients with surgical complications each year. The results suggest that hospitals in regional collaboratives can improve upon healthcare quality metrics more quickly than hospitals abstaining from participation.
The Wyoming Hospital Association launched a website that allows consumers to compare prices for 26 Wyoming hospitals, according to the Casper Star-Tribune. Wyopricepoint.com provides cost reports for hospitalizations ranging from chest pain to cesarean sections. The public can compare the results against other hospitals with similar patient volumes.
The Tennessee Department of Commerce and Insurance, Division of Health Planning plans on launching their APCD in 2010, according to the Commonwealth Fund. The goal is to use the data to improve healthcare access, affordability, and coverage; inform healthcare policy; determine the capacity and distribution of existing health care resources; evaluate the effectiveness of intervention programs to improve patient outcomes; compare costs across treatment setting and providers; and provide the public with information on healthcare quality.
The Attorney General’s first annual report examining cost trends and cost drivers in the Massachusetts healthcare market with the goal to identify, understand and explain why costs are escalating faster than general inflation. The report found price increases is the chief cost driver in Massachusetts over the last few years and that prices vary significantly within the same geographic area, unrelated to quality of care, the health of the population,the kind of facility care is received or delivery costs. These price variations were found to correlate with provider market power. The report calls for increasing transparency and standardization, improving market function, engaging consumers with decision-making tools and prompt action prohibiting insurer-provider contracts perpetuating market disparities.
The Aloha state has some of the lowest healthcare costs in the United States, according to The New York Times. Since 1974, all Hawaiian employers have been required to provide insurance to employees working 20 or more hours per week. Residents also have some of the least expensive insurance premiums in the country. While the exact reason has yet to be discovered, some suggest Hawaii’s successes in efficiencies, such as adopting an electronic medical record system, have been key to keeping costs down.
Atul Gawande, a physician who visited McAllen, Texas, discovered a broken healthcare system as described in The New Yorker. Overutilization, rather than population health and quality, seemed to explain the vast amount of spending, making the city one of the most expensive healthcare markets in the country.
The Long-Term Care Community Choices Act has been signed by the Governor, providing $1.2 billion to traditional nursing homes and community-based services providers in Tennessee’s managed care Medicaid program, according to the National Governors Association. The law provides consumers more choices for residential care providers and allows Medicaid funds to serve more people in cost-effective home and community settings.