State Health Reform

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State Health Reform

• Group J
• Ameen Baker
• Jason Chandler
• Kim Cox
• Mike Davis
• Sharon Goldberg

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State Health Reform

• National health reform
• Medicare reform
• Fraud and Abuse
• National health reform
• States step in
• Instead of national initiatives, states are
  forming initiatives of their own
• States are laboratories
• State Spending Increasing

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State Spending Increasing
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Setting the Scene An Overview

• National Level
• In 2004, 45.8 million people uninsured
• 68.1 of Americans covered by employers, the
  lowest since 2000
• Approximately 16 of GDP spent on healthcare

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Setting the Scene An Overview

• State Level
• States suffer from increasing healthcare costs
• States suffer from increasing health insurance
  costs
• States are moving towards consumer-driven
  healthcare
• States financial conditions are improving

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Regional Variation in State Growth, 2004-2005
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Total State Expenditures, FY 2004
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State Reform Plans

• Cost containment efforts
• Consumer-directed health care
• Ex Shift higher percentage of insurance premiums
  to employees
• Pay-for-Performance Models
• States have created public reports on the quality
  of care provided by plans, hospitals, and nursing
  home
• Prescription drug coverage
• Disease management
• Expand Health IT
• Regulatory Authority

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States Undertaking Medicaid Cost-Containment
Strategies
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Historic Legislation

• Reform efforts began in the mid 1970s
• Intention to cover the poor working uninsured
  citizens
• Crafted at the state level
• Required Medicaid 1115 Research Demonstration
  Waivers to implement

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State Health Care Reform Strategies

• Created state-funded programs
• Expanded/restructured Medicaid
• Experimented with individual small business
  subsidies
• Reformed the individual small group insurance
  markets

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State Health Care Reform Strategies

• Created Medical Savings Accounts
• Established purchasing alliances, high-risk
  pools, indigent care programs
• Crafted childrens health coverage (SCHIPs)
• Implemented expanded information technology and
  pharmacy systems

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Comprehensive Reforms

• Hawaii
• Oregon
• Tennessee
• Massachusetts
• Minnesota
• Vermont
• Washington

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Hawaii

• 1974 Prepaid Health Care Act
• employer mandate for all full-time employees
• 1991 State Health Insurance Program subsidized
  coverage
• 1994 QUEST Medicaid Waiver expanded coverage
  to 300 FPL

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Hawaiis Democratic Republican Influences

• Hawaii currently has a Republican governor,
  Linda Lingle. In 2002, she was the first
  Republican elected governor of Hawaii in 40
  years.
• Democratic Opinions
• "Hawaii has twice the number of doctor visits
  per capita and one-half the hospitalizations
• Edward Kennedy
• "The only place that has achieved nearly
  universal coverage and has less of a cost burden
  on its system is Hawaii"
• Hillary Clinton

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Oregon

• 1989 Oregon Health Plan (OHP 1)
• Goal Universal coverage
• Expanded the Medicaid program
• Required employers to offer health insurance to
  employees their dependents

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Oregon

• OHP 1
• Services delivered through managed care
• Prioritized list of benefits applied (rationing)
• Providers were paid their costs

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Oregon

• OHP 2
• Expanded in 2002
• Intent to cover up to 185 FPL
• Derailed with a downturn in Oregons economy
• Premium increases caused drop in enrollment
• Providers refused to see
• patients without co-pays

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OHP Meltdown

• 2003 Enrollment fell by 53
• 2004 Another 50 drop
• Closed to new enrollment since late 2004 due to
  budgetary constraints
• Uninsured now at 17, same rate that existed
  prior to OHP
• 2004 Improved IT and pharmacy systems in efforts
  to cut costs, provide better coverage for current
  enrollees

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Oregons Democratic Republican Influences

• In late 2003, Democratic Senator Ron Wyden
  promoted a national version of Oregons health
  reform plan, which was also endorsed by his
  Republican counterpart.
• Recent Democratic governors
• Ted Kulongoski
• John Kitzhaber, MD

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Tennessee

• TennCare 1994
• Created a global budget of federal state funds
• Restructured Medicaid
• Capitated managed care plans

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Tennessee

• Problems with TennCare
• Transition to managed care
• Low reimbursement to providers
• Administrative problems
• Budgetary conflicts
• Turnover in key leadership

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TennCare A Success?

• Covers 60 more people than traditional Medicaid
• Original political deal still intact
• Costs reduced coverage expanded
• MDs are still discontent
• Overall patient satisfaction is good
• Implemented TCMIS Information technology system
  and Pharmacy Edits
• Still has financial constraints and is unable to
  cover all citizens who need coverage

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TennCare A Success?

• Pharmacy Edits
• Enhances patient safety, lowers cost
• Avoids therapeutic duplication
• Sets a limit on max drug dose per day
• Limits duplication of RXs, prevents abuse
• Uses a Preferred Drug List (PDL)

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Tennessees Democratic Republican Influences

• Democratic Governor Phil Bredesen has reformed
  the TennCare program and still endorses the state
  controlling the pharmacy program. However,
  Bredeson cut funds for TennCare in 2005.

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Massachusetts

• 1988 Health Security Act an employer pay or
  play mandate
• Employer mandate postponed later repealed
• 1996 cigarette tax increase to fund kids/low
  income seniors health care
• Success of childrens program inspired Sen.
  Kennedy to propose SCHIP at federal level

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Massachusetts A Bipartisan Effort

• Currently led by Mit Romney, the Republican
  governor of Massachusetts
• Aims to cover 460,000 uninsured residents of the
  state
• Works to find common ground with both major
  political parties
• Democrats stress the need to move toward health
  coverage for all
• Republicans promote putting consumers in control

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Market Reforms

• Most occurred in the 1990s
• Purchasing alliance (28 states)
• Florida CHPAs
• California HIPC
• Rating reforms (NJ, NY, VT)
• Standardized plans (NJ VT)

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Current Legislation

• Human Papillomavirus (HPV) / Schools
• SB 660 / HB 561

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Background

• HPV is the most common STD in the United States.
• There are over 100 strains of HPV, of which over
  30 types can cause cervical cancer and genital
  warts.
• Gardasil, a vaccine approved by the FDA in June
  2006, prevents infection in some strains of HPV.

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Intentions

• Require all middle school girls to receive the
  Gardasil vaccine
• Require schools to educate families about HPV,
  cervical cancer, and the vaccine itself
• Allow parents the choice to opt out of the vaccine

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Main Critiques

• The timeliness of the bill
• Gardasil was approved only 10 months ago
• The message being sent
• Promoting sex, rather than abstinence
• The role of government in this process
• Families should be the ones to initiate these
  types of conversations with girls

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Other Critiques

• Too big a rush to inoculate girls
• Chance of adverse side effects
• A question of supply shortages
• Would be required for just one sex
• Has questionable motives since it has been
  marketed so aggressively
• Possible damage to the publics view of vaccines

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Strengths

• Help prevent the spread of HPV and cervical
  cancer
• A proactive approach to preventing cancer, and
  improving female health
• Likely aid in the education of safe sex practices
• Help teach parents the importance of other
  vaccinations
• Increase parental role
• Prompt necessary conversations

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Strengths

• Gardasil is approved by the FDA
• Families would still have the choice to opt out
  of the vaccine
• Most doctors are in support of the bill

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Weaknesses

• Requires a series of 3 shots in 6 months
• High costs
• 45 would be covered by Floridas Vaccines for
  Children program
• 55 would be eligible to receive the vaccine for
  free at county health departments
• Lack of support from the Department of Health
• Concerns about side-effects, and the financial
  burden to public health

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How Changes would Improve Legislation

• The legislation would be improved (and
  potentially passed) if
• Obtain support from DOH
• Gather additional research and information
  regarding side-effects, benefits, costs,
  suppliers, etc.
• Revisit marketing techniques
• Provide more education regarding the importance
  of vaccines/immunizations

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Democrat View

• Most support the bill since it encourages
  government intervention in providing affordable
  and quality health care to all
• Some question Mercks motives for contributing to
  the campaigns

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Republican View

• Most oppose the bill because of the message it
  might portray (promoting sex)
• Others oppose the bill because of the direct role
  government would play in providing health care
• However, there is some Republican support across
  the state

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Past, Present, and Futureof the Bill

• Was introduced by a Republican, but is more of a
  Democrat-supported bill
• The first vote was postponed, and then amended
• The amended motion failed 4-4
• A vote on the original bill has yet to be
  scheduled
• Is unlikely to pass in Florida because of the
  strength of the Republican-led house

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Proposed Legislation

• Statewide Medication Reconciliation Database
  Act of 2007

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Statewide Medication Reconciliation Database
Act of 2007

• Florida
• Oversight, Administration, Regulation by AHCA
• Allow for a centralized statewide database that
  compiles all patient medication information from
  all pharmacies

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Rationale

• Improve the delivery and quality of patient care
• Ensure the preservation of information despite
  natural disasters, catastrophes (ie hurricanes)
• Urgent need to
• Reduce medication errors
• Have a mechanism in place to allow for medication
  reconciliation
• Reduce adverse events
• Reduce the costs associated with these
  preventable errors and adverse events

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Rationale

• At least 44,000 Americans die each year as result
  of medical errors.
• Incidence of adverse drug events in hospitals is
  estimated to be 400,000 per year.
• Medication errors alone estimated to account for
  over 7,000 deaths annually.
• More people die annually from medication errors
  than from workplace injuries.
• IOM estimates that about 530,000
  medication-related injuries occur each year among
  Medicare beneficiaries in outpatient clinics.

To Err is Human, IOM, 1999 IHI Article, 2007
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Rationale

• 8.8 percent of all patients studied throughout
  the state's hospitals experienced preventable
  medical errors.
• Up to 1.5 million preventable adverse drug events
  annually.

- Florida AHRQ
- IOM Report, 2006
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Rationale

• One reports says medication errors are so common
  in hospitals that, statistically, a patient will
  be subjected to a medication error each day of
  their stay.
• Cost estimates from medication errors
• 3.5 billion in hospital setting
• 887 million for Medicare beneficiaries in
  outpatient setting

http//www.consumeraffairs.com/news04/2006/07/medi
cation_errors.html
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Rationale

• There are as many as 7,000 deaths annually in the
  United States from incorrect prescriptions
• (Carmen Catizone, National Association of Boards
  of Pharmacy)
• Told The Washington Post as many as 5 of the 3
  billion prescriptions filled annually are
  incorrect
• Thats 150 MILLION WRONG prescriptions!

Source GROUP F Quality http//www.consumeraffair
s.com/news/pharmacy_errors.html
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Target Groups

• Healthcare Providers
• Insurance Companies
• Pharmacies (large chains, small ma/pop)
• Patients/Community
• Healthcare Facilities
• . Basically everyone!

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Mechanism

• Standard web-based application to be used by all
  pharmacies
• RFP to potential technical vendors
• The medication information will automatically be
  entered into the database
• Mandated for all pharmacies
• Will make sure that it is affordable, provided to
  smaller pharmacies
• Will allow for medication reconciliation - will
  alert for contraindications, identify/prevent
  narcotics shoppers, etc.

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Financing

• Anticipated costs
• Begin implementation of network (FY 07-08)
• 9,443,598
• Complete development of network (FY 08-09)
• 8,742,898
• (FY 09-10)
• 7,726,898

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Financing

• Three options
• Allocate money from AHCAs budget
• 2 tax on all prescriptions
• Paid for by both the insurance and pharmaceutical
  companies
• All have pros/cons but everyone will see the
  amount of saved in the long-run, thereby
  making it worth the initial outlay of money

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Outcomes

• Decreased medication errors, increased quality of
  healthcare
• More standardization/effectiveness across
  pharmacies statewide
• Time for them to find a different way to compete
• Potential backlash from pharmaceutical companies
• Future Plans
• expansion of database at a national level
• Possible IT integration with FHIN, EHRs and CPOE

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Questions?