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Connecticut should focus on health value, not creating a state public option

There’s been much attention and focus on SB 842, the newest version of an attempt to create a government-run public health care option. While well intended, it is not the solution that Connecticut needs today. Instead, we should bring the focus and attention to the area that will most immediately help patients, consumers and employers: health care costs.

I have been actively involved in efforts to improve health care value in Connecticut for the last 15 years. Some of those efforts have been public − I was an original Sustinet board member, the last effort to create a public option and I am currently vice chair of the Connecticut Cost Growth Benchmark Technical Team. My work has included the creation of private initiatives − the Connecticut Business Group on Health, the Connecticut Choosing Wisely Collaborative, and the Moving to Value Alliance. I have worked closely with people on both sides of the public option debate. Through that experience, I have learned that the goals of both are aligned in many ways and are absolutely aligned in the goal of improving health care value, meaning higher quality and better access at a lower cost.

Many of us admire the work that the office of state Comptroller Kevin Lembo has done to improve health care value. For the last 10-plus years Lembo's office has been working closely with doctors and hospitals to improve value. Their medical plan design has nudged state employees to receive care that will result in better health outcomes. Their pharmacy contract repricing provided the state with meaningful savings. Recent work focused on contracting with health systems is innovative and forward thinking.

However, thinking that there will be substantially lower premiums to the public using the state employee health plan is a false hope. Connecticut’s health insurance premiums are based mostly on health care costs – how much doctors and hospitals charge when we use the health care system. Health care system price increases have been rising steadily for most of the last 10 years. Those prices are passed along to health care purchasers and result in higher premiums. While many complain about health insurers, the root cause of the premium increases is complicated and responsibility is shared by the health system itself, insurer payment methods, and government policymakers.

Until we shift our attention to collaboratively making the health system itself more accountable and value oriented, the comptroller’s office negotiating a better deal with a health system is simply going to result in the health system charging other payers more. A highly likely consequence of passage of a public option will be higher costs and premiums for self-insured employers and insurers covering individuals and small and mid-sized businesses.

The good news is that we are making progress holding the health system stakeholders more accountable. The work that Governor Lamont’s "Cost Growth Benchmark" group has been doing will make it more obvious which health care system participants are providing fair value and which are not. Policymakers and citizens will have access to data that provides real insights into specific areas where actions can be taken to improve health care value. There is good evidence from other states that this information and actions will bring costs under control.

Another important step to providing Connecticut citizens with higher value care is an increased investment in primary care. The Connecticut Office of Health Strategy, at Lamont’s direction, is focusing on executing a strategy to do this.

We all want to pay less for health care and receive better health outcomes. A study of the impact of cost-growth benchmarks in other states tells us that can happen with improved multi-stakeholder collaboration, transparency, and a focus on the root causes of what has been driving premium increases.

Paul Grady is a principal at Alera Group Northeast, an independent insurance and financial services firm with offices in Hartford and Norwalk.

 

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