Health Care Cabinet
Healthcare Cabinet Study of Cost Containment Models
In 2016, the Healthcare Cabinet conducted a study of cost containment models, pursuant to P.A. 11-58, Sec. 14. Information about this process is contained here, as well as in the meeting summaries for many of the 2016 Cabinet meetings. For specific agendas, minutes of Cabinet discussions, and materials presented to the Cabinet for this study, refer to the 2016 meeting summaries.
The final Cost Containment Model report is available here - Legislative Report FINAL -Cabinet 1-5-17
The documents summarizing the research and analysis for this report can be found here.
A summary of each state's efforts, with detailed analysis is available here.
A summary of the Request for Proposal and vendor selection process is detailed below:
State of Connecticut
Office of the Healthcare Advocate
Request for Proposal (RFP) for Consulting Services
For Healthcare Cabinet Study of Cost Containment Models
The Office of the Healthcare Advocate (OHA) is seeking consulting services to assist the Healthcare Cabinet in: A) studying healthcare cost containment models in other states, including, but not limited to, Massachusetts, Maryland, Oregon, Rhode Island, Washington and Vermont, and B) in identifying successful practices and programs that may be implemented in the state for the purposes of (1) monitoring and controlling healthcare costs, (2) enhancing competition in the healthcare market, (3) promoting the use of high-quality healthcare providers with low total medical expenses and prices, (4) improving healthcare cost and quality transparency, (5) increasing cost-effectiveness in the healthcare market, and (6) improving the quality of care and health outcomes.
- Full announcement
- First addendum
- Second addendum
- Responses to bidder questions
- Click here for the fourth addendum
- Click here for the fifth addendum
The response period is now closed.
PA 15-146 directed the Health Care Cabinet to study health care cost containment models in six states: Massachusetts, Maryland, Oregon, Rhode Island, Washington and Vermont. The Legislature asked the Cabinet to identify successful practices or programs that may be implemented in the state for the purpose of:
- Monitoring and controlling health care costs;
- Enhancing competition in the health care market;
- Promoting the use of high-quality health care providers with low total medical expenses and prices;
- Improving health care cost and quality transparency;
- Increasing cost-effectiveness in the health care market; and
- Improving the quality of care and health outcomes.
The following information represents the research that was collected as part of this study. It was collected between March and December 2016 and was accurate at the time of publication. Since state health care policy is dynamic, please keep in mind the date in which you’re viewing this information as state policy or practice may have changed.
This research is organized by state and, within each state, into seven domains of inquiry as follows:
- Administrative and clinical data collection, analysis and reporting. State efforts at health care cost containment need to be informed by current data on cost and quality of the health care system. Therefore, this domain sought to identify what data are collected by states, and by which entity, and how states publish the information for consumer use and policy making.
- Medicaid purchasing and coverage strategies. Medicaid is a central health care program for any state and this domain describes the activities that each state have taken within their Medicaid program to control health care costs.
- State employee health plan coverage and payment strategies. This section describes the activities that each state have taken with their state employee health plan to control health care costs.
- State actions to enhance competition in the marketplace. Highly consolidated insurer and provider markets can sometimes lead to health care price increases. This domain describes what the six states have done to ensure healthy competition within their state as a strategy for cost containment.
- State regulatory actions. This domain describes the regulatory role each of the six states played with respect to health care, and which of those regulations are aimed at cost containment.
- Payment and delivery system reform. Many states are the drivers of payment and delivery system reform. This domain describes primarily what actions the state has taken to pursue payment and delivery system reform, but also describes key marketplace participants’ activities as well.
- Environmental context. It is important to understand the environmental context in which any state is operating – culturally and politically each state is different. This domain describes what environmental facilitators helped with cost containment policy implementation.
Below is a summary of the analysis of each of the six states specified in P.A. 11-58, with links to a detailed analysis of each state and the seven domains examined.
Massachusetts is characterized by government-supported and market based payment reform strategies, which are strengthened by the state’s strong commitment to transparency. The state regularly collects, analyzes, and publishes health care data to inform market participants – providers, plans, employers, and to some extent, consumers. The legislature has been influential in shaping health care policy, and several Governors have made health care reform a priority, each helping advance health reforms in the state.
Maryland has been setting FFS rates for hospital for all payers since 1974. The state’s new all-payer model establishes a total hospital per capita revenue growth ceiling tied to long-term projected per capita state economic growth, to help combat the volume incentive that was inherent in its FFS approach. Hospitals are also incentivized to reduce readmissions and partner with community-based providers to achieve long term population health improvements. The state’s agreement with CMS requires Maryland to expand the model to the full spectrum of services and providers within five years.
The Oregon Health Authority serves as the single agency responsible for the state’s health purchasing, health policy development, HIT infrastructure and analytic capabilities. With control of nearly 30 percent of Oregon’s health care spending, the agency is able to drive strategic change. This has included creation of 16 Coordinated Care Organizations responsible for all Medicaid care in a designated region and with expected savings of $4.9 billion over 10 years.
Since 2008, Rhode Island’s Office of the Health Insurance Commissioner (OHIC) has served as the key agency leading statewide cost containment initiatives and creating standards for insurer participation in the market. These standards encompass a broad range of state expectations and affordability priorities, including targets for both primary care spending and alternative payment methodology adoption by insurers, as well as caps on hospital rate increases, creation of ACO-oriented standards, and support for Rhode Island’s statewide information exchange.
Washington’s Health Care Authority (HCA) serves as the single state agency for health care services and is committed to the integration of Medicaid and state employee purchasing activities. The HCA sets expectations for nine regional Accountable Communities of Health to achieve statewide goals for population health improvement. HCA is aggressively managing the Medicaid program to align with its goal of moving 80 percent of state-financed and 50 percent commercial health care to outcomes based payment in five years.
Vermont is characterized by a collaborative environment where parties with different interests come together to try to forge agreement through compromise. The Green Mountain Care Board, an independent board appointed by the legislature, regulates insurance rates and hospital budgets via a linked process with $66 million in estimated savings. CMS recently approved Vermont’s All-Payer ACO Model to test an alternative payment model. The model commits to limits on annualized per capita health care expenditure growth for all payers.