Mind Your Ps and Qs - Colorado Health Institute · 2020. 1. 2. · SB 14-187: Colorado Commission...
Transcript of Mind Your Ps and Qs - Colorado Health Institute · 2020. 1. 2. · SB 14-187: Colorado Commission...
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Mind Your Ps and Qs
Amy Downs and Nina RoumellDecember 4, 2014
Levers to Reduce the Price and Quantity of Health Care
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• After a lull, health care cost growth is increasing again.
• Health care markets don’t operate like typical markets.
• A number of opportunities exist that may reduce costs.
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A Long Way to Go Average Total Single Premium (In Dollars), Private-Sector Establishments, United States And Colorado, 2000-2012
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What Drives Costs? Where To Start?
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Breaking Down Health Care Cost:
A Simple Formula
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Alfred E. Neuman’sCosmic Health Care Law
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The Technology Conundrum
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SOURCE: Health Care Costs: Key Information on Health Care Costs and their Impact, Kaiser Family Foundation, 2009
Traditional Insurance: Buffet-Style Demand
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Health Behaviors DriveAnnual Health Care Costs
Tobacco $289 Billion
Obesity $190 Billion
Alcohol $224 Billion
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Fee for Service: It’s About the Money
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Colorado Business Group on Health; PROMETHEUS
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Levers that Keep Costs in Check
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1. Consumers bear costs of purchases.
2. Buyers make choices based on transparent information.
3. Competition exists among suppliers to add value to services and products.
In Traditional Markets . . .
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Consumers Bearing the Cost
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More Skin in the Game
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Show Me the Money: High Deductible Plans
46%
10%
5%
2%
1%
21%
28%
24%
20%
14%
26%
39%
54%
58%
57%
7%
24%
17%
12%
9%
8%
20%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
1993
1999
2003
2008
2013
Conventional HMO Preferrred Provider Network Point of Service High deductible
Enrollment by Insurance Plan Type, United States, 1993-2013
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Benefit Design: Tipping the Scale
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Reference Pricing
Cholesterol lowering
medications
Source: National Institute for Health Care Reform
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Reference Pricing: From Theory to Practice
Robinson J C , and Brown T T Health Aff 2013;32:1392-1397
©2013 by Project HOPE - The People-to-People Health Foundation, Inc.
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Shifting Risk—and Reward—to Employees
Encouraging employees to take responsibility for their health and health care
High-deductible plans
Wellness incentives
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Transparency
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Transparent Information for Informed Choices: Cost and Quality
• Health Insurance Marketplaces • All Payer Claims Databases
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Engaging Consumers in Medical Decisions
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Increasing Competition
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Buying in bulk: Walmart and Lowes
• Crossing state lines to use providers (Centers of Excellence)
• Bundled payment
Increasing Competition Among Providers
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Providers Bearing More Risk
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Bundled Payments: One-Stop Shopping
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Defensive Medicine and Tort Reform
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SB 14-187: Colorado Commission on Affordable Health Care
• 12-member group will conduct in-depth analysis of Colorado’s health care cost drivers.
• Goal: Recommend ways to contain costs while improving access and quality.
Containing Health Care Costs
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• After a lull, health care cost growth is increasing again.
• Health care markets don’t operate like typical markets.
• A number of opportunities exist that may reduce costs.
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Amy Downs Nina Roumell [email protected] [email protected]