My entry today picks up on the issue raised by Secretary Kirwan at the end of her recent post, in the hope of generating some informed exchange on the issue of cost containment. No one disputes the imperative of bringing health care spending under control; this is necessary for the continued viability of both the Chapter 58 coverage expansions and the U.S. health care system overall.

How do we do it? To be sure, cost containment is not an issue that has been ignored until now; many recent innovations in health care delivery and financing have this explicit goal. But let me offer these two pieces of information and then pose some questions:

1. At the annual meeting of the Health Care Quality and Cost Council last Friday, Stuart Altman presented a list of techniques for limiting growth in health spending, in ascending order (by his estimation) of impact:

Very limited impact
• Encourage greater use of preventive services
Limited impact
• Provide better price and quality information
• Require patients to pay more
• Restrict use of harmful care
• Create a governmental “high cost reinsurance system” with effective case management for chronic conditions
• Reduce expense and waste of medical malpractice system
• Pay-for-performance reimbursement Read more…

True or false: offering hospitals financial incentives to reduce racial and ethnic disparities actually helps reduce disparities.

Answer: we don’t know, but the MassHealth program is hoping to find out. This October, MassHealth’s contracts with the state’s hospitals will introduce a “pay for performance” program that will pay hospitals bonuses if their care meets certain quality benchmarks. Pay for performance was mandated by last year’s health reform law, which also required that the benchmarks include reducing racial and ethnic disparities.

Pay for performance (P4P) is a relatively new and largely unproven strategy for motivating quality improvement. Including disparities measures among the P4P benchmarks is unprecedented and methodologically complicated. A roundtable of experts examined the challenges and issued these recommendations for the future development of a P4P plan for reducing disparities. Read more…

Having health insurance is unquestionably better than not for providing a pathway to health care, so the more than 100,000 people newly insured since last July by MassHealth and Commonwealth Care are already better off in that regard. But how much better off? How good is the access, and the care, they are receiving? Read more…

The State Children’s Health Insurance Program (SCHIP) was created by Congress in 1997 to provide coverage to children whose family income was too high to qualify for their state’s Medicaid program. In Massachusetts, SCHIP is part of MassHealth, covering about one-fifth of the 460,000 children enrolled. Nationwide, SCHIP covers about 6 million children, many of whom would otherwise be uninsured. Some states have also received permission to used SCHIP funds to cover parents and pregnant women (Massachusetts is in this latter group).

Here is an issue brief describing the past, present and potential future of SCHIP in Massachusetts. SCHIP is a critical part of the Commonwealth’s coverage expansion strategy because of its relationship to MassHealth and, by extension, the health care reform law. This year, SCHIP has been an important policy focus in Washington, and legislative action in the coming months will have significant repercussions in Massachusetts.

One immediate issue is the funding of SCHIP in the current fiscal year. Unlike Medicaid, SCHIP is not an open-ended entitlement. Read more…

How much can the availability and use of information alter a market? Economics says that information about price and quality is essential for markets to work. Yet health care, one of the largest markets in our economy, is notable for the lack of public information available to purchasers, providers and especially consumers of medical services.

Sustaining the coverage gains of health reform depends critically on controlling health care spending over the long term. The health reform law puts great hope in the power of information for this task by creating the Health Care Quality and Cost Council. Read more…

MassHealth, the Massachusetts Medicaid program, has already contributed strongly to the goals of health reform: increasing enrollment by 40,000 as of the end of January (of an estimated 89,000 made newly eligible by Chapter 58), and providing systems operations support to the Connector in order to get Commonwealth Care up and running. (MassHealth enrollment actually dipped – probably temporarily – in January, the result of the resumption of an administrative requirement to periodically re-establish eligibility that had been suspended since last July.)

MassHealth provides a foundation for health reform in other important ways that warrant policy makers’ attention. Read more…