commissioner becky hultberg commissioner bill streur
DESCRIPTION
Health Care and Fiscal Sustainability. Commissioner Becky Hultberg Commissioner Bill Streur. State budget: 2001 - 2010. Total state spending (operating and capital, PFD excluded) has doubled from $4 billion to $8 billion in 10 years. - PowerPoint PPT PresentationTRANSCRIPT
Commissioner Becky Hultberg Commissioner Bill Streur
Health Careand Fiscal Sustainability
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State budget: 2001 - 2010
The rate of spending growth over the last decade averaged 7.5% per year, but inflation (Anchorage CPI) over the last decade averaged only 2.6% per year.
Total state spending (operating and capital, PFD excluded) has doubled from $4 billion to $8 billion in 10 years. Spending per capita has increased from $6,639/person in 2001 to $11,234/person in 2010.
Health Care and Fiscal Sustainability
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State revenue
TAPS subsidizes much of modern life in Alaska• Schools - about 66% of K-12 spending• State - about 90% of state general purpose unrestricted
revenue• PFDs - over $900 million in payouts each year• State capital projects
Health Care and Fiscal Sustainability
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State oil production: 2001- 2010
Oil production has steadily declined by just over 5% per year.Health Care and Fiscal Sustainability
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Health care spend: 2001-2010
Medicaid, AlaskaCare active, AlaskaCare PERS/TRS, State Workers Compensation, Department of Corrections, union trusts
The rate of growth of state health care costs, 2001-2010: 9.4% per year.
2001: $856 million
2010: $1.9 billion
This includes the federal portion of Medicaid.
Health Care and Fiscal Sustainability
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Health care spend by component
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010$0.0
$200.0$400.0$600.0$800.0
$1,000.0$1,200.0$1,400.0$1,600.0$1,800.0$2,000.0 Corrections
MedicaidWorkers CompTRSPERSAlaskaCare
(Chart in millions of dollars)
Health Care and Fiscal Sustainability
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Where does our current path lead?
If state paid health costs continue to increase at 9.4% per year, in FY 2020 they will exceed $4 billion (before Medicaid reimbursement).
State health care expenditures, 2020
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Challenge
20112012
20132014
20152016
20172018
20192020
20212022
20232024
20252026
20272028
20292030
2031
Millions$6,000
$5,000
$4,000
$3,000
$2,000
$1,000
$0
Projected Medicaid Cost Growth
Health Care and Fiscal Sustainability
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AK DHSS 10-Year PlanOperating BudgetFY2013: $2.6 Billion Projected: FY2022 $6.6 BillionUnknowns• Impact of the U.S. National health care initiative• Tighter federal and state budgets• Broad economic problems – e.g. financial markets, energy costs, mortgage defaults, medical
inflationMedicaid• Population• Medical InflationPublic Assistance• Inflation• Population Growth in• Population 20-34 years• Population growth 65+
years of age –Adult Public Assistance
20122013
20142015
20162017
20182019
20202021
20222023
20242025
20262027
20282029
20302031
Millions
$6,000
$5,000
$4,000
$3,000
$2,000
$1,000
$0
2011
Health Care and Fiscal Sustainability
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Medicaid Direct ServicesBeneficiaries and Expenditures
Health Care and Fiscal Sustainability
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Medicaid Direct ServicesBeneficiaries and Expenditures
Senior and Disabilities Medicaid
$401,911.929%
Health Care Services Medicaid
$740,619.954%
Office of Children’s Services Medicaid$7,900.7 - 1%
Adult Preventative Dental Medicaid$9,249.1 - 1%
Behavioral Health Medicaid - $203.628.115%
FY 2011 Medicaid Direct Services
Expenditures by Division(thousands)
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Controlled Growth in Medicaid
The Options are Limited
• Eligibility • Compliance/Anti-Fraud
• Covered Services • Innovations in Service Delivery
• Rates • Technology
• Utilization Controls • Maximize Revenue
Health Care and Fiscal Sustainability
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State Policy Actions Implemented in FY 2011 and Adopted for FY 2012
NOTE: Past survey results indicate not all adopted actions are implemented. Provider payment restrictions include rate cuts for any provider or freezes for nursing facilities or hospitals.SOURCE: KCMU survey of Medicaid officials in 50 states and DC conducted by Health Management Associates, September 2011.
3528 33
2213 13
32 33
3946
2 4
18 18 14 11
FY 2011
Adopted FY 2012
States with Expansions / Enhancements
States with Program Restrictions
Provider Payments Eligibility Benefits Long Term Care
Health Care and Fiscal Sustainability
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Medicaid Services
Mandatory• Inpatient hospital• Outpatient hospital• Physicians• Nurse midwives• Lab and X-ray• Advanced Nurse Practitioners• Early Periodic Screening,
Diagnosis, and Treatment• Family planning services• Pregnancy-related services• Nursing facility (NF) services• Home Health (NF qualified)• Medical/surgical dental services
• MH Rehab/Stabilization• Diagnostic/Screening/Preventive• Therapies (OP, PT, SLP)• Inpatient psychiatry <21 years• Drugs• Intermediate Care Facility for the
Intellectually Disabled • Personal care• Dental• Other home health• Other licensed practitioners• Transportation• Targeted Case Management
Optional
Health Care and Fiscal Sustainability
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Payment Comparisons
Payment Levels Office Visit (99215) Obstetrical Care (59400)
Alaska Medicaid $221.58 $2821.81
Alaska Medicare $177.40 $2354.90
Alaska Commercial Mean $290.64 $4704.80
Washington Medicaid $76.86 $2034.50
Washington Commercial Mean
$183.24 $2601.20
North Dakota Medicaid $186.19 $2339.40
Idaho Medicaid $117.01 $1539.21
Milliman Client Report: Physician Payment Rates in Alaska and Comparison States prepared for Alaska Health Care Commission 2011
Health Care and Fiscal Sustainability
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AlaskaCare health plan
Includes the active plan (non-unionized employees and some bargaining units) and retiree plan
Plan statistics:
Active plan16,346
members(includes
dependents)
$83,350,793 total spend in FY11
Ability to change plan and impact steerage
Retiree plan63,034
members, about 40% live outside Alaska
$413,524,583 total spend in
FY11
Limited ability to impact
steerage
Health Care and Fiscal Sustainability
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Retiree vs. Active EmployeeChronic Diseases in our Populations
Asthma
Congestive Heart Failure
Chronic Obstructive Pulmonary Disease
Cerebrovascular Disease
Atrial Fibrillation
Coronary Artery Disease (incl. MI)
Diabetes
Osteoarthritis
Hyperlipidemia
Hypertension
21
4
7
7
6
18
51
28
71
90
29
29
39
45
56
83
144
147
190
290Actual
Norm
Chronic Liver and Biliary Disease
Atrial Fibrillation
Coronary Artery Disease (incl. MI)
Bipolar Disorder
Congenital Anomalies
Asthma
Osteoarthritis
Diabetes
Hyperlipidemia
Hypertension
5
6
18
7
9
21
28
51
71
90
7
7
9
11
12
23
37
43
74
85
Retiree Member Countper 1,000
Employee Member Countper 1,000
Source: Sightlines Medical Intelligence – Disease Registry (January 2010 to December 2011)
Health Care and Fiscal Stability
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Projected Retirement System Growth
2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 20300
10,000
20,000
30,000
40,000
50,000
60,000
70,000
Health Care and Fiscal Sustainability
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Jan 10 - Dec 10 Jan 11 - Dec 11
0.710000000000001
0.690000000000001
Jan 10 - Dec 10 Jan 11 - Dec 11
$560.07
$581.80
Jan 10 - Dec 10 Jan 11 - Dec 11
$400.40
$403.87
Active Employee Medical Expense Growth
Change in MedicalPer Member Per Month
Change in Unit Pricing
Change in Utilization
-3%
+4%
+1%
Dollars/eventEvents/m
ember m
onth
Health Care and Fiscal Stability
Source: Sightlines Medical Intelligence – Claims (January 2010 to December 2011)
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Retiree Medical Expense Growth
Jan 10 - Dec 10 Jan 11 - Dec 11
$378.08
$398.55
Jan 10 - Dec 10 Jan 11 - Dec 11
$329.51
$362.52
Jan 10 - Dec 10 Jan 11 - Dec 11
1.15
1.10
Change in MedicalPer Member Per Month
Change in Unit Pricing
Change in Utilization
-4%
+9%
+5%
dollars/eventEvents/m
ember m
onth
Source: Sightlines Medical Intelligence
Health Care and Fiscal Sustainability
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AlaskaCare claims data: physician fees
Procedure Alaska Medicare
Area 995 90% UCR (Anchorage)% Medicare
Area 981 90% UCR (Washington)% Medicare
Total Hip Arthroplasty $1,772.07 $12,155.00685.9%
$5,409.00305.2%
Fragmenting of Kidney Stone
$1,154.71 $8,200.00710.1%
$2,120.00183.6%
Nasal/Sinus Endoscopy, Surgery
$369.99 $2,620.00708.1%
$871.00235.4%
Inject Spine L/S (CD) $218.63 $1,260.00576.3%
$683.00312.4%
RPR Umbil Hern, Reduc > 5 yr
$529.40 $3,385.00639.4%
$1,229.00232.1%
Health Care and Fiscal Sustainability
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The hidden cost of health care
Opportunity cost of dollars spent on health care: roads, public safety, schools and other public services
Health Care and Fiscal Sustainability
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The State’s approach
Our challenge:We must lower the rate of growth of our health care spend. Our current path is not sustainable.
Our approach:o Work together with the hospital and physician communityo Support high-quality, cost-effective health care delivery in
Alaskao Develop and support innovative solutions to our health
care challenges
Health Care and Fiscal Sustainability
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Specific strategies: AlaskaCare
• Better leverage our purchasing power • Consider expanded travel benefits or
Centers of Excellence for certain services
• Develop a robust employee wellness program
• Continue to aggressively pursue contractual discounts
• Align contracting strategies around innovative care delivery models
• Develop a comprehensive health management strategy
Health Care and Fiscal Sustainability
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Innovations in Service Delivery/Payment
• Medical Home• Tribal Health – exemplar of alternative provider types• Bundled services• Integrated BH/Primary care services• Pay for performance• Utilization review and management (radiology, Rx)• Community based long-term care• Disease/Case Management• Managed Care• Dual eligibles
Health Care and Fiscal Sustainability
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Maximize Match/Collections/Refinancing Opportunities
• Replace state funding with federal funding where
allowable• Tribal Partner opportunities• Co-Pays
• 6 states increased and 4 states decreased co-pay amounts
Health Care and Fiscal Sustainability
Thank you!For more information:
www.DOA.alaska.gov and www.HSS.alaska.gov
Questions?