Flash Player 9 (or above) is needed to view presentations.
We have detected that you do not have it on your computer. To install it, go here.

Like this presentation? Why not share!

Like this? Share it with your network

  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Be the first to comment
    Be the first to like this
No Downloads


Total Views
On Slideshare
From Embeds
Number of Embeds



Embeds 0

No embeds

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

    No notes for slide


  • 1. Health Care Reform: Minnesota and the Nation Julie Sonier Director, Health Economics Program Minnesota Department of Health September 22, 2009
  • 2. Objectives
    • How are health reforms in Minnesota similar to and different from national efforts?
    • Describe Minnesota’s recent reform activities and goals
  • 3. Minnesota starts from a reasonably good place
    • Insurance coverage:
      • Among the nation’s lowest uninsurance rates
        • Strong employer base
      • MinnesotaCare subsidized insurance program (since 1992, pre-SCHIP)
        • Subsidized coverage for parents and kids to 275% FPG
        • Single adults and childless couples to 250% FPG (effective July 2009)
  • 4. Minnesota starts from a reasonably good place
    • Consistently ranked as one of the healthiest states
    • History of collaboration and innovation to improve health care
      • Largely non-profit environment
      • Collaboration around best practices, quality measurement
  • 5. The Context for Health Reform Discussions in Minnesota
    • In spite of our relatively good starting point:
      • Rising health care costs in the state are unsustainable
      • Our health care system has misaligned incentives
        • Large variations in quality – inversely related to cost
        • We pay for volume, not value
      • Private insurance has eroded, and the number of uninsured has increased
      • Unhealthy behaviors have created high and rising costs of preventable disease
    • Similar problems exist at the national level
  • 6. Total health care spending in Minnesota up nearly 70% between 2000 and 2007 Source: Minnesota Department of Health, Health Economics Program
  • 7. Health insurance cost growth far exceeds growth in incomes and wages Note: Health care cost is MN privately insured spending on health care services per person, and does not include enrollee out of pocket spending for deductibles, copayments/coinsurance, and services not covered by insurance.. Sources: Minnesota Department of Health, Health Economics Program; U.S. Department of Commerce, Bureau of Economic Analysis; U.S. Bureau of Labor Statistics, Minnesota Department of Employment and Economic Development
  • 8. Historical Perspective: Health Care Spending Growth is Not a New Problem
  • 9. U.S. Health Care Spending as a Share of Gross Domestic Product *Projected. Source: Centers for Medicare and Medicaid Services. Historical spending estimates as of January 2009; projections as of February 2009.
  • 10. Misaligned Incentives: Higher Payment for Lower Quality
  • 11. Minnesota Diabetes Care: Improving but only 1 in 7 receive optimal care Source: MN Community Measurement Health Care Quality Report
  • 12. Sources of Insurance Coverage in Minnesota, 2001 and 2007 Source: Minnesota Health Access Surveys, 2001 and 2007
  • 13. Minnesota Uninsurance Rates by Income Source: Minnesota Health Access Surveys, 2001 to 2007
  • 14. Minnesota Uninsurance Rates by Age Source: Minnesota Health Access Surveys, 2001 to 2007
  • 15. Minnesota Uninsurance Rates by Race and Ethnicity Source: Minnesota Health Access Surveys, 2001 to 2007
  • 16. Trends in Overweight/Obesity in Minnesota Normal Weight Overweight Obese Source: Behavioral Risk Factor Surveillance Survey
  • 17. Obesity Trends* Among U.S. Adults BRFSS, 1990 (*BMI ≥30, or ~ 30 lbs overweight for 5’ 4” person) No Data <10% 10%–14%
  • 18. Obesity Trends* Among U.S. Adults BRFSS, 1994 (*BMI ≥30, or ~ 30 lbs overweight for 5’ 4” person) No Data <10% 10%–14% 15%–19%
  • 19. Obesity Trends* Among U.S. Adults BRFSS, 1998 (*BMI ≥30, or ~ 30 lbs overweight for 5’ 4” person) No Data <10% 10%–14% 15%–19% ≥20
  • 20. Obesity Trends* Among U.S. Adults BRFSS, 2004 No Data <10% 10%–14% 15%–19% 20%–24% ≥25% (*BMI ≥30, or ~ 30 lbs overweight for 5’ 4” person)
  • 21. Impact of Rising Obesity on Health Care Costs
    • Increasing prevalence
    • Widening gap between health care spending for obese vs normal weight population
    • One national study found that obesity-related health spending accounted for 27% of inflation-adjusted per capita health spending increases from 1987 to 2001
      • 41% of the rise in heart disease spending
      • 38% of the rise in diabetes-related spending
    Source: Thorpe et al., “The Impact of Obesity on Rising Medical Spending,” Health Affairs, October 2004.
  • 22. Public and Private Cost Pressures
    • Cost of private coverage rising faster than incomes, inflation
      • Likely a contributing factor to recent erosion in private insurance coverage
    • Public programs face dual sources of cost pressure:
      • Rising enrollment
      • Rising cost per person
    • So, in addition to cost and access problems, we have a sustainability problem
    • Which problem to address first?
  • 23. Approaches to Health Reform
    • Massachusetts approach: address coverage first, cost later
    • Minnesota: expanded coverage too, but greater focus on reforms that improve quality/cost to ensure sustainability
    • National debate: mostly focusing on coverage
  • 24. 2007-2008 Minnesota Health Reform Plans
    • Health Care Transformation Task Force (Governor appointed)
      • Charge from legislature included reducing health care expenditures by 20%
    • Health Care Access Commission (Legislative)
    • Both reports included recommendations for comprehensive reform, with much common ground
  • 25. Overview of Health Reform Bill Key Elements
    • Public health improvement
    • Health care coverage/affordability
    • Chronic care management
    • Payment reform and price/quality transparency
    • Administrative efficiency
    • Health care cost measurement
  • 26. Public Health Improvement
    • Invests in community-based efforts to reduce rates of obesity and tobacco use
    • Builds on current CDC-funded pilots
    • Total of $47 million in grants to communities
  • 27. Health Care Coverage and Affordability
    • Expanded eligibility for MinnesotaCare for adults without children to 250% of the poverty level
      • Outreach efforts, streamlined enrollment
    • Tax credits for uninsured to purchase private coverage
    • Employers with more than 10 employees required to establish “section 125” plans if they don’t offer health insurance coverage to employees
  • 28. Payment Reform: Why Is It Needed?
    • Current system: based on individual services
      • Few incentives for prevention, care coordination/management, quality improvement, innovation, or value
      • Few consumer incentives to choose provider based on quality or cost
      • Limited information on price and quality of care
      • Provider incentives to invest in profitable services and to avoid unprofitable services
  • 29. Payment Reform: Chronic Care Management
    • Promotes use of “health care homes” to coordinate care for people with complex/chronic conditions
    • MDH and DHS to develop standards of certification for health care homes
    • Care coordination payments to health care homes
      • Public and private purchasers, beginning July 2010
  • 30. Other Payment Reforms and Price/Quality Transparency
    • Establish a set of common quality measures and incentive payments for quality
    • “ Peer grouping” of providers on relative cost, quality, and resource use
      • Public and private purchasers will use this tool to strengthen member incentives to use high-quality, low-cost providers
    • Promotes transparency and innovation by establishing bundled pricing for 7 commonly defined “baskets of care”
  • 31. Administrative Simplification
    • Health care providers must have electronic health records by 2015, and they must be interoperable
    • Electronic prescribing by 2011
    • Study of ways to reducing claims adjudication costs for health plans and providers
  • 32. Concluding Thoughts
    • Expanding coverage:
      • Relatively easy to explain why this is important
      • Given political will (and money), path is fairly straightforward
    • Quality/cost/value:
      • Much more complex – difficult to engage policymakers and the public
      • No magic answers to the problem, but some promising ideas
    • All of these issues must be addressed to make the system more equitable and sustainable
  • 33. Contact Information: Julie Sonier [email_address] (651) 201-3561 Health Reform Website: www.health.state.mn.us/healthreform