Increasing Health Spending

SOURCE: Centers for Medicare & Medicaid Services 2015

2015 2016 2017 2018 $560 $589 $627 $662

Projected State and Local Health Expenditures:

Spending Levels ($ in billions)

2018

2017

2016

2015

5.7%

6.5%

5.2%

4.5%

State and Local Health Expen-ditures:

Projected Annual Growth Rate

State Medicaid Spending• FY 2015 •Medicaid Spending: 15.1% increase to $512.3 billion• Funds: only increased 4.8%. • Total State Spending: 27.4% on Medicaid•General Fund Spending: 19.3% on Medicaid

• Following the initial ACA surge of Medicaid expansion, federal funding will begin to phase down in 2017

SOURCE: National Association of State Budget Officers (NASBO) 2015

Medicaid Expansion

•Other approaches:• Expansion waivers•Work-related provisions

SOURCE: Kaiser Family Foundation 2016, Governing 2016, Forbes 2016

• 19 states still refused federal funding for expansion• 3 states

discussing

Expansion stateNon-expansion stateDiscussing expansion

Opiate Addiction

4,030

15,59718,893

Fatalities by Opioid Pain Relievers Nationwide

2009

SOURCE: Centers for Disease Control (CDC) 2015, American Society of Addiction Medicine (ASAM) 2015, The New York Times 2016

State Responses to Opiate Addiction•Vermont: Gov. Shumlin 2014 State of the State •Ohio: Gov. Kasich’s Opiate Action Team - new guidelines encouraging doctors to find alternatives for addressing pain•Massachusetts: House passed a comprehensive bill aimed at addressing opioid addiction

SOURCE: Governing 2015, Dayton Daily News 2016, Mass Live 2016

Opiate Addiction•Non-Traditional Solutions•Needle exchange clinics• Police administering Naloxone to save lives

• “Good Samaritan” Laws• Foster Care: Heroin abuse now driving more children into foster homes

SOURCE: The Portland Press Herald 2015, Associated Press 2016, Huffington Post 2016, The National Conference of State Legislatures 2015, Governing, 2015

Mental Health Funding

SOURCE: National Alliance on Mental Illness, 2015

Mental Health•Military: Nearly 1 in 4 active duty members show signs of mental illness•Psychiatric Boarding: A struggling U.S. psychiatric care system often results in patients with mental illness detained in emergency rooms for long periods• 84% percent of ER staff say they board psychiatric patients• Reported shortages of care space and resources

•Gun Control: Mental illness and the link to gun violence

SOURCE: National Alliance on Mental Illness 2015, Governing 2015

HHS IT Spending•HHS IT spending = 25% of all state and local government IT spending•HHS is the strongest growth area for IT spending

State and Local IT

HHS IT

$97B

$25B

2015 Estimated IT Spending

SOURCE: The Governing Institute 2015

HHS Data and Technology•Data Sharing vs. Privacy/Security: Data driven solutions are needed for improved outcomes, balancing demands for privacy and service delivery •Workflows and Infrastructure: Opportunities include automated workflows and cloud •Data Explosion: Increasing quantities of data demand innovations in storage, analytics, and security

SOURCE: The Governing, Institute 2015, 2016

Market Forecast•2016 HHS state and local spend to increase 5-6%•The Medicaid expansion debate continues – it’s partisan and a Presidential election year!•Opiate addiction epidemic requires nontraditional solutions to save lives•Mental health services in demand •Data and technology investments more critical than ever