Roles of State Legislatures and State Government in Determining Health Care Policy John E....

Roles of State Roles of State Legislatures and State Legislatures and State

Government in Government in Determining Health Care Determining Health Care

PolicyPolicyJohn E. McDonough, Dr.PH., John E. McDonough, Dr.PH.,

M.P.A.M.P.A.Executive DirectorExecutive DirectorHealth Care for AllHealth Care for AllMassachusetts HouseMassachusetts House of of Representatives (1985-97)Representatives (1985-97)

McDonough Slide #McDonough Slide #22

SESSION OUTLINESESSION OUTLINE

I.I. Three Pillars of Health PolicyThree Pillars of Health Policy

II.II. Four Eras in U.S. Health PolicyFour Eras in U.S. Health Policy

III.III. Eight Key State Government Eight Key State Government RolesRoles

IV.IV. Federalism and Health PolicyFederalism and Health Policy

V.V. Your Role in All of ThisYour Role in All of This


I. Three Pillars of Health I. Three Pillars of Health PolicyPolicy

CostCost AccessAccess QualityQuality

EverythingEverything you do affects at least one, and you do affects at least one, and frequently twofrequently two

Health policy home run – positively Health policy home run – positively influence all threeinfluence all three Childhood ImmunizationChildhood Immunization

Most of the time, Most of the time, pick any twopick any two……


Costs: The Big Picture (1)Costs: The Big Picture (1)Health Spending in $$$ and as Percent of US Health Spending in $$$ and as Percent of US

EconomyEconomy

4

6

8

10

12

14

16

1970 1980 1993 1999 2001 2003

7%

8.8%

13.3%13.2% 14.1%

15.3%

$73B

$246B

$888B $1.2T$1.4T

$1.68T

CSMith et al. Health Spending Slows in 2003. Health Affairs, Jan/Feb. 2005.


Costs: The Big Picture (2)Costs: The Big Picture (2)Increases in Premiums vs. Earnings and InflationIncreases in Premiums vs. Earnings and Inflation

02468

101214161820

1988 1989 1990 1993 1996 1999 2000 2001 2002 2003 2004

Health Premiums Overall Inflation Workers Earnings

18.0%

0.8%

13.9%

11.2%12.9%10.9%

8.5%

12.0%

2.3%

2.2%


Costs: The Big Picture (3)Costs: The Big Picture (3)U.S. Health Spending vs. Other Industrialized U.S. Health Spending vs. Other Industrialized

NationsNations

41 4451 57 57

68

100

0

20

40

60

80

100

120

UKJa

pan

Australi

a

Canad

a

Ger

man

y

Switzer

land

USA

U.S. Health RankingsU.S. Health Rankings:: Infant Mortality: 28Infant Mortality: 28thth

Life Expectancy: 24Life Expectancy: 24thth

Births to WomenBirths to Women

Ages 15-19 in Ages 15-19 in Industrialized Nations: Industrialized Nations: 3030thth

Measles Immunization: Measles Immunization: 1414thth


Access: 45 Million Access: 45 Million Uninsured AmericansUninsured Americans

17.6-27% (10)

15.2-17.6% (8)

14-15.2% (11)

11.7-14% (11)

6.8-11.7% (11)


Quality: The Disturbing Quality: The Disturbing PicturePicture


Four Health Policy ErasFour Health Policy ErasEra I: Pre/Emerging System PeriodEra I: Pre/Emerging System Period Pre-1910sPre-1910s Minimal licensure and professional Minimal licensure and professional

standards standards No health insurance as we know todayNo health insurance as we know today Minimal public investmentsMinimal public investments No standards for medical educationNo standards for medical education Infectious disease leading cause of deathInfectious disease leading cause of death Life expectancy ~46 yearsLife expectancy ~46 years See See The Social Transformation of The Social Transformation of

American Medicine – American Medicine – Paul StarrPaul Starr


Four Health Policy ErasFour Health Policy ErasEra II: Professionalization and GrowthEra II: Professionalization and Growth 1910s to 1960s1910s to 1960s Scientific breakthroughsScientific breakthroughs Widespread licensure, professional Widespread licensure, professional

standards, public sector regulationstandards, public sector regulation Development of modern health Development of modern health

insurance and insurance regulationinsurance and insurance regulation Federal Support: medical education, Federal Support: medical education,

facilities, researchfacilities, research Emergence of chronic disease as Emergence of chronic disease as

leading cause of deathleading cause of death


Four Health Policy ErasFour Health Policy ErasEra III: Government RegulationEra III: Government Regulation 1965 to late 1980s (life expectancy ~70s)1965 to late 1980s (life expectancy ~70s) Creation of Medicare & Medicaid in 1965Creation of Medicare & Medicaid in 1965 Market failure as defining metaphorMarket failure as defining metaphor Cost control as major public priorityCost control as major public priority Government/business partnershipGovernment/business partnership Key instruments to address market failure: Key instruments to address market failure:

Certificate of needCertificate of need Health system planningHealth system planning HMO ActHMO Act Hospital rate settingHospital rate setting


Four Health Policy ErasFour Health Policy ErasEra IV: Market DominanceEra IV: Market Dominance 1990s through today1990s through today Key idea: market failure can be Key idea: market failure can be

correctedcorrected Phase I: The managed care revolutionPhase I: The managed care revolution

Led to backlash and retreatLed to backlash and retreat Growth in investor owned health entitiesGrowth in investor owned health entities Major provider consolidationsMajor provider consolidations Different role for governmentDifferent role for government Phase II: Era of the consumer Phase II: Era of the consumer

Health savings accounts (“skin in the Health savings accounts (“skin in the game”), transparency, public data releasegame”), transparency, public data release


What’s Next?What’s Next?

““The solution is not a government-run The solution is not a government-run system or a fend-for-yourself marketplace system or a fend-for-yourself marketplace but, instead, a new approach that but, instead, a new approach that combines the best care options offered by combines the best care options offered by the private sector backed by the the private sector backed by the resources and oversight of Federal and resources and oversight of Federal and State governments.” State governments.”

Sen. John Breaux (D-La.), on his proposal for universal Sen. John Breaux (D-La.), on his proposal for universal health coveragehealth coverage

Still waiting…Still waiting…


Key State Government Key State Government Roles in Health CareRoles in Health Care

Public Health Facility/Professional Regulation

Regulation of Insurance/HMOs

Health WorkforceEducation Training

Provide/Finance ServiceCost Containment

InformationDissemination

Health SystemMonitoring


Key State Roles: IKey State Roles: I1.1. Public HealthPublic Health

Population health, disease control and Population health, disease control and prevention, sanitation, environmental prevention, sanitation, environmental protection, bioterrorismprotection, bioterrorismSchism with Clinical MedicineSchism with Clinical Medicine

2.2. Regulation: Facilities and ProfessionalsRegulation: Facilities and Professionals

Licensure: e.g., hospitals, nursing Licensure: e.g., hospitals, nursing homes, clinics, physicians, nurses, social homes, clinics, physicians, nurses, social workers; scope of practice; disciplineworkers; scope of practice; discipline

• Joint Commission on Accreditation of Joint Commission on Accreditation of Healthcare Organizations; Certificate of NeedHealthcare Organizations; Certificate of Need

From Quality Assurance to Quality ImprovementFrom Quality Assurance to Quality Improvement


What is Quality?What is Quality? Quality of care is the degree to Quality of care is the degree to

which services which services for individuals or for individuals or populationspopulations increase the increase the likelihood of desired health likelihood of desired health outcomes and are consistent with outcomes and are consistent with current current professional knowledge.professional knowledge.―― Institute of Medicine, 1990Institute of Medicine, 1990

Quality is doing the right thing Quality is doing the right thing and doing it right.and doing it right.


Key State Roles: IIKey State Roles: II3. Regulation of insurance and HMOs3. Regulation of insurance and HMOs

Solvency concerns, consumer Solvency concerns, consumer protectionprotectionERISA (Employee Retirement ERISA (Employee Retirement Income Security Act of 1974 – your Income Security Act of 1974 – your 800 lb. gorilla)800 lb. gorilla)

4. Health workforce education4. Health workforce educationSupport for medical education, Support for medical education, State medical schools, other State medical schools, other professionalsprofessionalsHow to finance fairly in managed How to finance fairly in managed care environment and tight fiscal care environment and tight fiscal times?times?


Key State Roles: IIIKey State Roles: III5. Provision/financing of health care 5. Provision/financing of health care

services – services – Make/Buy?Make/Buy? Medicaid: fee for Medicaid: fee for

service/gatekeeper; managed service/gatekeeper; managed care/capitation care/capitation

State worker/retiree health State worker/retiree health insuranceinsurance

Indigent services: public hospitals, Indigent services: public hospitals, clinics, uncompensated careclinics, uncompensated care

Health coverage expansionsHealth coverage expansions Other services: mental health, Other services: mental health,

mental retardation, veterans, other mental retardation, veterans, other disabilitiesdisabilities

Pharmaceutical assistancePharmaceutical assistance


Key State Roles: IVKey State Roles: IV6. Cost Containment6. Cost Containment What can government do about rising What can government do about rising

costs (premiums, prescriptions)? costs (premiums, prescriptions)? Pay for Performance Pay for Performance Evidence-Based MedicineEvidence-Based Medicine

7. Information Dissemination7. Information DisseminationPublic reporting on hospitals, Public reporting on hospitals, physicians, nursing homes, HMOs. physicians, nursing homes, HMOs. Who gets what?Who gets what?

8. Health System Monitoring8. Health System Monitoring Anti-trust & mergers, malpractice, for Anti-trust & mergers, malpractice, for

profit conversions, specialty hospitals. profit conversions, specialty hospitals. When to intervene?When to intervene?


Federalism & Health Federalism & Health PolicyPolicy

1960 and 1970s1960 and 1970s:: Mandates and Mandates and limited discretion, i.e., Medicaid, limited discretion, i.e., Medicaid, Employee Retirement Income Employee Retirement Income Security Act of 1974 (ERISA)Security Act of 1974 (ERISA)

1980s1980s:: Transition, i.e., New Transition, i.e., New Federalism, block grants, Boren, Federalism, block grants, Boren, WaxmanWaxman

1990s and 2000s1990s and 2000s:: Partnership, Partnership, i.e., Medicaid waivers, HIPAA, i.e., Medicaid waivers, HIPAA, SCHIPSCHIP

Is the partnership beginning to Is the partnership beginning to fray?fray?


Your Role in Making Health Your Role in Making Health Care Work in Your StateCare Work in Your State

The Job of a Legislator (Fenno, 1978)The Job of a Legislator (Fenno, 1978) Being one of themBeing one of them

Getting around, soliciting advice, Getting around, soliciting advice, relating to culture relating to culture

Providing servicesProviding services Helping constituents, organizing Helping constituents, organizing

community initiativescommunity initiatives Acquiring resourcesAcquiring resources

Using prerogatives to obtain resourcesUsing prerogatives to obtain resources Expressing policy views and interestsExpressing policy views and interests

District/PersonalDistrict/Personal


Your Role in Making Health Your Role in Making Health Care Work in Your State Care Work in Your State

(cont).(cont). What is politics?What is politics?

The way we decide “who gets what” The way we decide “who gets what” without resorting to violencewithout resorting to violence

What is health care politics?What is health care politics? The way society decides “who gets The way society decides “who gets

what” what” The culture says: Politics is bad/corruptThe culture says: Politics is bad/corrupt Bob Kuttner says: “…Politics is the Bob Kuttner says: “…Politics is the

practice of democracy in real life”.practice of democracy in real life”. This is your turn, your momentThis is your turn, your moment

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