Overview

This summary is based on "Comprehensive State Reforms Address Health Care Quality and Efficiency" in the March/April 2007 issue of the newsletter States in Action. Vermont's 2006 Health Care Affordability Act pursues coverage expansion through the creation of comprehensive and affordable private insurance ("Catamount Health" plans) and through premium assistance to low-wage workers. But the legislation's overriding goal is to control steeply rising health care costs. To achieve this, the act focuses on managing chronic care, which accounts for 70 percent of the state's health care spending.

The Issue: State legislatures and governors are increasingly proposing or implementing comprehensive health care reform plans that extend beyond coverage expansion to address the quality of care, health promotion, and cost containment. These multifaceted plans aim to improve the overall performance of the health system—recognizing the imperative to increase the value of care obtained for the dollars spent. Maine, Massachusetts, and Vermont have passed and are implementing such comprehensive reforms, and governors and legislators in many other states, including California, Maryland, Pennsylvania, and Wisconsin, are introducing variations of these reforms as well as new strategies. Since others have written about the coverage aspects of reform plans, this profile focuses on their efforts to address health care quality and efficiency. Most of the quality and efficiency strategies are related to chronic care management, wellness and prevention, patient safety, and transparency through data collection and health information technology. Proponents of these strategies emphasize that these measures to improve the quality of care and health status are integrally tied to cost containment. They argue that practices that help people achieve healthier lives, help providers reduce errors, and help purchasers make better, more informed decisions also generate savings in the long run. The reform plans include both incentives and mandates, both "carrots" and "sticks." A primary focus of many of these comprehensive reform plans is chronic care management, particularly for asthma, diabetes, and heart and lung disease. Policymakers cite data illustrating that the majority of health care costs are attributed to a minority of patients with chronic disease, and that these patients are not receiving the right amount or best kind of care. For example, Pennsylvania's Governor Rendell points out that, "Even though 75 percent of health care costs can be traced to the 25 percent of patients with chronic disease, these Pennsylvanians received only 56 percent of the care they need." The reform proposals seek to increase use of nationally proven models or "best practices" for treating chronic disease through pay-for-performance and other incentives to providers. The reform plans also promote prevention and wellness, with a particular focus on tobacco use and obesity. They feature nutrition counseling, smoking cessation, and exercise programs, provided through such mechanisms as telephone help lines, schools, and community partnerships. Some reform proposals would establish insurance plans that reduce premiums or copayments if enrollees engage in healthy activities. Comprehensive reform plans also include provisions to support health information technology that promotes patient safety (e.g., electronic medical records, e-prescribing), data collection, and public reporting. Proponents expect that making comparative performance information available to purchasers of health care, including state agencies, employers, and consumers, will enable them to make better choices. Such data could also encourage providers to improve the quality and efficiency of the care they provide. Target Population: Low-wage workers; people with chronic conditions The Intervention: Vermont's 2006 Health Care Affordability Act pursues coverage expansion through the creation of comprehensive and affordable private insurance ("Catamount Health" plans) and through premium assistance to low-wage workers. But the legislation's overriding goal is to control steeply rising health care costs. To achieve this, the act focuses on managing chronic care, which accounts for 70 percent of the state's health care spending. The state is establishing a chronic care management system available to all residents based largely on the state's "Blueprint for Health." Features include:

• an extensive care coordination system including early and coordinated screening for diabetes, asthma, and other chronic conditions; the state is targeting 1,200 of the highest-need Medicaid beneficiaries annually, and field staff are being hired and trained;
• reimbursement to providers that encourages care management and high quality (versus quantity), such as home visits, appointment reminders, and follow-up work;
• patient self-management educational tools, as well as education of providers and other stakeholders in promoting self-management;
• Medicaid and Catamount Health and the state employee health plan contract for disease/chronic care management, which is designed to reduce costs;
• community grants to develop physical activity programs; and
• development of a multi-payer database of claims information to help the state analyze the efficiency and effectiveness of the health care system.