KHN Morning Briefing

Summaries of health policy coverage from major news organizations

States Struggle With Significant Financial Budget Strains, Especially In Medicaid; Others Position For Innovative Coverage Efforts

Bloomberg: "U.S. states expect 'significant challenges' balancing budgets in the next two years, after closing $230 billion in gaps since 2009, as U.S. stimulus aid drops and tax receipts recover from the recession, a study said. While state spending is set to rise for the current fiscal year compared with 2010, after two straight annual declines, governments will face renewed pressure in 2012, according to the study released today by the National Governors Association. The budget period begins in July in 46 states. … States are responsible for funding part of Medicaid, the federally subsidized health-care program for the poor, as well as schools, transportation projects and public safety. Demand for Medicaid, which provides for more than 60 million people, grew as U.S. unemployment rose during and after the recession, peaking at 10.1 percent in October 2009, the highest level in 26 years. The jobless rate declined to 9.6 percent by October 2010. The lingering strains present a challenge to the new slate of governors set to take office around the country next month" (Selway, 12/1).

The Associated Press/CBS 4 Denver: "Wyoming could begin enrolling people in a state-funded health care program before the end of the year, Gov. Dave Freudenthal announced Tuesday. Called 'Healthy Frontiers,' the program will offer health insurance coverage for up to 200 working people who can't afford it on the open market. The state put up $750,000 this spring to start the program, which will emphasize health screenings and [preventive] medicine. Freudenthal on Tuesday signed the operating plan for the state program. He said he hopes it ultimately will allow the state to spend less money on the federal Medicaid program. He emphasized that unlike Medicaid, people will have to work at least half time to be eligible for the state program" (Neary, 11/30).

The Portland (Maine) Press Herald: "Congress passed national health care reform this year, but it will be up to Maine and the other states to figure out how to improve care and reduce costs. That was the challenge presented to about 300 health care providers and experts who gathered Tuesday for a forum called 'National Health Care Reform: Leveraging Opportunities for Maine.' … [The event] focused on more popular sections of the law that encourage innovation to drive down costs. Because Maine is already experimenting with new kinds of doctors' offices and payment systems, national and state advocates said the state may play an important role in shaping the reforms" (Richardson, 12/1).

The Providence Journal: "The Care New England hospital group filed suit Tuesday seeking to block new health insurance rules that are intended to control hospital costs. Decrying what it called 'rogue actions' by Health Insurance Commissioner Christopher F. Koller, the suit is the first challenge to Koller's unusual requirements on health insurers. As a condition of rate increases approved in July, Koller required that health insurers' new contracts with hospitals move toward changing the hospital-finance system and include limits on price increases. Although Koller's rules apply only to insurers, they are affecting negotiations with hospitals. And Care New England asserts that he is overstepping his authority" (Freyer, 12/1).

The Boston Globe: Massachusetts health care costs "can't continue to rise rapidly without crippling the state's economy and public services. But efforts to rein them in will require new team-based health care payment and delivery approaches, which would demand sacrifices from hospitals, doctors, and insurers," according to industry and consumer leaders at a recent Massachusetts Health Policy Forum. "Health care costs in Massachusetts have climbed more than 10 percent annually for the past five years, making it harder for businesses to hire workers and state government to fund education and public works programs." Governor Deval Patrick is trying to control health costs through a payment overhaul bill that will go to the Legislature next month. One of its aims "is to create 'global payment' plans that put doctors and hospitals on an annual budget for each patient's care. Another is to create a regulatory framework for how health care providers can form partnerships, called accountable care organizations, to coordinate care and distribute payments." But the details of the global payment plans, meant to replace the current "fee-for-service" system, have yet to be determined. Health experts warn that Massachusetts care models should avoid improving efficiency at the expense of quality and access (Weisman, 12/1).

The MetroWest (Mass.) Daily News: "The chiefs of Massachusetts's most prominent hospital network and private health insurer agreed Tuesday that the path to controlling soaring health care costs" begins with "adjusting to a climate of limited resources and learning to live with less." At a health care conference sponsored by Brandeis University's Massachusetts Health Policy Forum, health care leaders said providers would need to grow accustomed to not having the most cutting-edge technology, and that health insurers should "squeeze more savings out of their operations by reducing administrative costs"  The bulk of the conference focused on the development of 'accountable care organizations,' groups of doctors, specialists, home health aides and support staffs that coordinate patients' care, a system that stakeholders say could limit unnecessary, expensive procedures" (Cheney, 11/30).

Michigan Capitol Confidential: "In March, the GOP legislative attempts to thwart the Patient Protection and Affordable Care Act were considered a fantastic hope. Known nationwide as a 'Health Care Freedom Amendment,' proposals by State Representatives Brian Calley, R-Portland, and Justin Amash, R-Cascade, to change the constitution and repeal the national health care law never got to a vote as they were squashed by the Democrats. But Calley is now part of the Republican takeover of state government. He's the Lt. Governor-elect under Rick Snyder and the GOP has a super majority in the Senate and a strong majority in the House. … Calley said Tuesday that he continues to support his proposal to implement a HCFA in Michigan" (Gantert, 12/1).

The Associated Press/The Washington Post: In New York, "Families choosing whether to donate a loved one's organs usually have days to grapple with their decision, all while the patient lies hooked up to machines in a hospital bed. But they would have only about 20 minutes to make the choice in a new pilot program meant to recover organs from patients who die at home. That's roughly how long a team of organ specialists will have after a cardiac-arrest patient is declared dead to arrive at the home, check a donor registry, determine medical eligibility, obtain a family member's consent and get the person into a specialized ambulance. The program launching Wednesday - the first of its kind in the U.S., according to organizers and other experts - could eventually lead to thousands more organs donated each year nationwide" (Gross, 12/1).

The Associated Press/Bloomberg Businessweek: "The Washington state insurance commissioner wants to consider some companies' cash surpluses before approving the rates they charge. That's one of the requests Commissioner Mike Kreidler has for state lawmakers when they convene in January. The power to consider surpluses would apply to nonprofit health insurers, who make up most of the health market in Washington. Kreidler said some firms have built up hundreds of millions of dollars in surpluses while seeking double-digit rate increases" (11/30).

This is part of the KHN Morning Briefing, a summary of health policy coverage from major news organizations. Sign up for an email subscription.