State Health Reform

By Emily Friedman	October 22, 2012
A report from the 25th annual State Health Policy Conference of the National Academy for State Health Policy.

Baltimore ?Despite an uncertain environment, state health policymakers are trying to proceed with reforms to the nation's health care system. Even as they try to maneuver through mandates imposed by the Affordable Care Act, they are eyeing regional solutions and creating a more patient-friendly environment. The policymakers gathered in Baltimore on Oct. 17 for a meeting convened by the National Academcy for State Health Policy, which was founded in 1987 by a group of state health officials, seeking a forum where they could exchange ideas about Medicaid, health insurance, regulation, and other programs.

The NASHP Executive Director Alan Weil noted that important lessons have been learned from two and a half decades of state-federal health policy tussles:

• Federalism is a defining feature of American health policy ? "the baton keeps getting passed back and forth," and "without a federal framework, states will move in variable directions."
• Economic cycles drive health policy cycles.
• State health policy "never sleeps," but is constantly active.
• Health system improvements are as hard to sustain as they are to attain.
• Health system improvements "do not spread like mayonnaise; we don't always know how to spread our lessons around the country."

Weil predicted that "federal-state relations will continue to be unsettled," and that more attention must be paid to interstate issues and regional solutions. "States can be an awkward unit for change," he said, adding that "we can no longer look at health policy only as a state-by-state affair."

States are trying to proceed with reforms, despite an uncertain environment. The results of the upcoming election are proving difficult to predict and the politics of each state have their vagaries. Furthermore, in order to comply with the ACA, each state must define a package of essential health benefits, decide whether to participate in the law's expansion of Medicaid, and whether to operate its own health insurance exchange or leave it to the feds, among other major challenges.

Norman Thurston, coordinator of health reform implementation for the Utah Department of Health Care Finance, lamented, "The biggest challenge we have is that these are incredibly complex questions ? how to create an exchange, whether to undertake Medicaid expansion ? and yet newspapers and legislators and others see them as yes or no issues, where you just check a box."

Nevertheless, as Joshua Sharfstein, secretary of the Maryland Department of Health and Mental Hygiene, said, "There is amazing opportunity for the states right now." However, resources and time frames are tight, staff are overloaded, and there can be provider resistance. Trish Riley, adjunct professor of health policy at the University of Southern Maine and a founder of the academy, pointed out that health care is shifting from fee-for-service to primary care and managed care models and paying providers for "keeping people healthy" ? not an easy transition. As Bruce Greenstein, secretary of the Louisiana Department of Health and Hospitals, observed, most hospital revenue in his state comes from fee-for-service, and "the hospitals are not changing overnight."

Still, many officials at the meeting welcomed provider participation. In Utah, said Thurston, the state is working with hospitals to assist patients who need help navigating the system; hospitals have asked for access to the state's eligibility data base for this purpose. Rhode Island has had representatives in hospitals for 15 years who help patients fill out applications and gain eligibility for state programs. Furthermore, according to Anne Marie Costello of the Centers for Medicare & Medicaid Services, the ACA allows hospitals to make presumptive eligibility decisions for patients and CMS will be issuing guidance for that within the next two months.

Many states are focusing on service improvement and easier access to state programs, as well as reform initiatives. Vermont is seeking to create a single-payer system, although there are many political and regulatory obstacles. Rhode Island, ironically, is seeking to re-link social services such as temporary aid for needy families and food stamps with health program eligibility ? the irony being that what was known as welfare was linked to Medicaid for decades; they were uncoupled in the 1990s as part of welfare reform.

The challenges are many, but the states are trying to embrace change and create a more patient-friendly environment. As Richard Gilfillan, M.D., director of the Center for Medicare and Medicaid Innovation and former CEO of the Geisinger Health Plan, said at the closing session, "We built a system around patients that doesn't meet their aspirations. We built the system around how providers want to deliver care, not how patients want to receive it." But he believes that the system can and will do better because, as he observed, "Nobody went to school to provide fractured, expensive, unstable care." It remains to be seen whether the states will be able to rewrite that equation.

The opinions expressed by authors do not necessarily reflect the policy of Health Forum Inc. or the American Hospital Association.

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