Budget Analysis
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The document summarizes key aspects of Ohio's executive budget and Medicaid reform plan, which aims to address an $8 billion budget deficit. Some key points include: reducing funding to local governments and schools by over $2.2 billion, agency reductions of over $2.3 billion, and Medicaid savings of $4.3 billion through reforms to payment rates, eligibility, and care coordination programs. The reforms restructure Ohio's Medicaid program and shift its focus toward home and community-based care through initiatives like Accountable Care Organizations and integrated care delivery systems.
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Introduction
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Major Elements of PPACA
The most significant elements of the PPACA legislation are scheduled to take place over several years. Congress still has the ability to modify some of these elements, so we will examine them with that in mind.
June 2010
Adults with pre-existing conditions were eligible to join a temporary high-risk insurance pool run by the federal government. This will be replaced by a health care exchange in 2014, which will provide access to insurance at affordable rates. Applicants must have a pre-existing health care condition and have been uninsured in the six months prior to application. Premiums will be set at rates for the general population rather than the high-risk premiums charged by insurance companies. Out-of-pocket costs will be limited to $5,950 for individuals and $11,900 for families.
July 2010
The government established the National Prevention, Health Promotion, and Public Health Council, with the Surgeon General to act as chair of the council. This council will oversee the implementation of many of the PPACA elements and will disseminate recommendations to the health care community at large in regard to best practices in prevention and health promotion. As of fall 2010, little had yet been heard from this entity. However, the National Committee on Quality Assurance, which is a private entity dedicated to improving the quality of health care services, is providing best practices and quality measures for health care providers, especially hospitals.
September 2010
Insurance companies can no longer apply lifetime dollar limits on essential benefits for patients. In addition, children may be covered under their parents' insurance plan until they turn 26 years of age. This includes children not living at home, not listed as dependents on their parents' tax returns, not students, and children who are married. Further, no patients under 19 years of age with pre-existing conditions can be excluded from health care benefits based on the pre-existing conditions, and there can be no deductibles or copayments required for provision of preventive care measures and medic ...
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Ac os
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815 039 aco summit mw v4final
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Smd10012
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Sabrina Matson Graduate Thesis
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Healthcare Reform and Lean Leadership
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Editor's Notes
- According to the Governor’s Office of Health Transformation, payments for physician and clinical services in Ohio is .3% less than the U.S. average. Executive budget features such as accountable health homes and emphasis on health and wellness may be of interest to physicians.
- According to the Governor’s Office of Health Transformation, Ohio’s Medicaid per capita spending for hospitals is twelve percent (12%) greater than the U.S. average and in SFY 2010, twenty-eight percent (28%) of total Ohio Medicaid expenditures went to hospitals. The Executive budget proposes to continue the hospital franchise fee to draw down federal matching funds but does not redistribute all of the money solely to hospitals. Further, policy changes will subject hospitals to reimbursement cuts through “Modernization of Hospital Payments” noted above.
- According to the Governor’s Office of Health Transformation, individuals covered by both Medicare and Medicaid consume forty-six percent (46%) of Medicaid long-term care spending and sixteen percent (16%) of behavioral health services spending.
- According to the Governor’s Office of Health Transformation, Ohio’s Medicaid per capita spending for nursing home care is fifty-two percent (52%) greater than the U.S. average with only five (5) states spending more per capita. Seventeen percent (17%) of Ohio’s Medicaid expenditures in SFY 2010 went to nursing facilities.
- According to the Governor’s Office of Health Transformation, Ohio’s per capita spending for home health care is 8.3% less than the U.S. average and comprised fourteen percent (14%) of Ohio’s Medicaid expenditures in SFY 2010. The Executive budget would engage Miami University’s Scripps Gerontology Center to complete an evaluation of the cost effectiveness of the PACE program, which serves approximately 750 people. Further, Ohio will pursue an initiative to share savings with Medicare for dual eligibles. No further enrollment will occur until complete.
- The Executive budget will place greater responsibility on managed care plans to administer quality improvement programs. For example, it proposes to create a pay-for-performance program, continues to require accountability for preventive services (e.g., well-child visits and prenatal care), and establishes a withhold of one (1) percent of the capitation payment for plans to earn back as an incentive payment tied to performance. The Executive budget proposal assumes that expansion of managed care to include children with disabilities (a transition component of establishing pediatric accountable care organizations) will allow health plans to spread their administrative expenses across more lives.
- Information from the Ohio Governor’s Office of Health Transformation appears to focus primarily on involving children’s hospitals. However, many other hospitals in Ohio provide significant pediatric services and could also be brought into the process of developing pediatric ACOs. Such hospitals should look for opportunities to participate in the legislative and regulatory development of the pediatric ACOs to ensure they will also have the opportunity to establish or participate in the ACOs.
- According to the Governor’s Office of Health Transformation, adults with serious mental illness represent ten percent (10%) of Medicaid population but account for 26% of total Medicaid expenditures.