Experts Say States Should Focus on Controlling Prices, Reducing Low-Value Care to Make Health Care More Affordable

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February 12, 2020

Joanne Kenen, Liz Hagan, Janet Weiner, and Vicki Veltri at Altarum Healthcare Value Hub event.Joanne Kenen moderates a panel featuring Liz Hagan, Janet Weiner, and Vicki Veltri (pictured left to right).

Policy experts gathering in Washington, D.C. today urged states to make health care more affordable for residents by regulating prices through a variety of mechanisms and reducing the provision of low-value care.

The event was hosted by Altarum’s Healthcare Value Hub with support from the Robert Wood Johnson Foundation.

Roslyn Murray, a consultant for Catalyst for Payment Reform, said reducing prices should be a top priority of states, chiefly by addressing the anti-competitive actions of large, consolidated health systems; instituting price transparency regulations; empowering insurance commissioners to better address rate increases; and negotiating better prices for state employee and retiree health plans.

Speakers pointed to Colorado and Rhode Island for their success in giving more power to insurance commissioners to reject unaffordable rates; Oregon and Montana for imposing price ceilings in their state employee benefit contracts; and Colorado’s latest effort to offer a public option that places limits on hospital prices.

In addition to price-setting measures, Lynn Quincy of Altarum’s Healthcare Value Hub and Vicki Veltri of the Connecticut Office of Health Strategy emphasized that low-value care is a critical area for state action. "There are significant savings to be found in low-value care," said Veltri. The Healthcare Value Hub recently released a State Healthcare Affordability Scorecard that showed few states are taking action on low-value care even though it is prevalent across every state.

Jen Mishory of the Century Foundation, an expert in public insurance expansion proposals, said states should consider seeking waivers from the federal government to enact measures that can reduce premium costs, such as waivers that implement reinsurance.

The panelists discussed the importance of a common standard of affordability. "We need a standard to target to policies," said Liz Hagan of U.S. of Care. As an analogy, Janet Weiner of the Leonard Davis Institute of Health Economics noted the value of the federal poverty measure; while far too low, it provides a benchmark for policymakers.

Veltri discussed Connecticut’s effort to create an affordability standard that reflects the many factors that affect a family’s ability to afford healthcare—not only income but family size, other financial obligations, and health status. Veltri emphasized the importance of data in informing the standard.

Weiner noted that affordability can also be seen in simple terms, such as any obstacle someone faces in getting the care they need. "There are horrible inequities in our system," she said. “Far too many with less than $400 in their bank account have a $1,500 deductible."

Experts also touched on other important ways to reduce costs, from expanding Medicaid to cost-sharing strategies. The Healthcare Value Hub provides an affordability framework that captures all strategies that states should consider when addressing affordability, from extending coverage and making cost sharing affordable to reducing low-value care and curbing excess prices.

A recording and written summary of the event along with studies cited by the panel will be posted shortly on the event website.

We are grateful to Joanne Kenen of Politico for her excellent moderating of the event and Andrea Ducas of the Robert Wood Johnson Foundation for her insightful introductory and closing remarks. 

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Altarum is a nonprofit organization that creates and implements solutions to advance health among vulnerable and publicly insured populations.