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Maine's Experience in Expanding Coverage: Changes in Health Care Financing and Organization

This article discusses Maine's experience in expanding health care coverage through the Commonwealth Fund's State Innovations Program. It highlights the challenges faced, the strategies implemented, and the achievements to date. The article also emphasizes the importance of system reform and sustainability in achieving high-quality, affordable health care for all.

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Maine's Experience in Expanding Coverage: Changes in Health Care Financing and Organization

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  1. MAINE’S EXPERIENCE IN EXPANDING COVERAGE The Commonwealth Fund’s State Innovations Program Changes in Health Care Financing and Organization (HCFO)--a national program of the Robert Wood Johnson Foundation February 1, 2008 Trish Riley, Director Governor’s Office of Health Policy and Finance State of Maine

  2. SETTING THE CONTEXT • ● 2002 – 2003 - “All Quiet on the Western Front” - No common discussion of cost crises (e.g.: TODAY) - Commonwealth Fund Commission on A High Performance Health System - McKinsey & Co. – “Accounting for the Cost of Health Care in U.S.” 1

  3. THE CONTEXT FOR REFORM • THE U.S SPENDS MORE; GETS LESS • Need a more effective & efficient health • system & healthier people 2

  4. Scores: Dimensions of a High Performance Health System 3 SOURCE: Commonwealth Fund National Scorecard on U.S. Health System Performance, 2006

  5. …but Maine & the US Spend More Per Person Than Other Industrialized Nations 11 4 Sources: Anderson GF, Frogner BK, Johns RA,, Reinhardt UEHealth Care Spending And Use Of Information Technology In OECD Countries. Health Affairs 25(3), 820, for data on US and OECD nations. Maine figure estimated using data from the CMS Office of the Actuary. * UK amount is for 2002.

  6. KEY FACTS • New England states spend more than the US average. 2004 Per Capita Health Care Spending 5 Source: CMS

  7. DIRIGO HEALTH REFORM • System Reform – Not just an insurance • product • • Improve Quality • • Lower Cost Growth • • Invest in Access Expansion 6

  8. Need multiple strategies to cover uninsured and underinsured • Maine’s Uninsured • > 300 % FPL 39,000 • 100-300% FPL 57,500 • < 100% FPL 29,000 • Underinsured • 2004-2006 Sales of “most popular” product in • individual market -- $15,000 deductible – rose 29% 7

  9. Dirigo Health 3-Tiered Strategy Assure affordability for those in the market & uninsured > 300% FPL COST CONTAIMENT/ IMPROVE PUBLIC HEALTH/ MAINE QUALITY FORUM < 300% FPL- Sliding scale subsidies Low income – fully subsidized 8

  10. MAINE’S EXPERIENCE IN EXPANDING COVERAGE The Commonwealth Fund’s State Innovations Program Changes in Health Care Financing and Organization (HCFO)--a national program of the Robert Wood Johnson Foundation February 1, 2008 Karynlee Harrington, Executive Director Dirigo Health Agency

  11. 9 DRAFT

  12. LESSON 1 • ●Hard to make the case for cost crisis in 2003 • ● Public understood “hidden tax of bad debt and charity care” from un and underinsured • ● Compromise weakened cost containment • Rejected • ● Global budget for hospitals • ● Assessment on insurers not passed onto payers 10

  13. FINANCING / SUSTAINABILITY • One time State funding • Medicaid • SOP → Capture savings & reinvest • - Hard to measure • - Savings vs. cost avoidance • - Conflict – same funding source advocates for HRP • 4 Year effort to stop SOP • Blue Ribbon Commission • Alternate funding included “pay or play” plan & individual mandate plus reinsurance – rejected by Legislature 11

  14. WHAT HAS DIRIGO HEALTH REFORM ACHIEVED TO DATE • Enrolled over 23,000 participants and over 725 Small Businesses in Dirigo Choice and over 5,000 Parents in MaineCare. • Strengthened the CON Process. • Strengthened Hospital Cooperation Act. • Required providers to submit claims electronically in a uniform fashion. • Regulated premiums in the Small Group Market for the first time. • Hospitals, doctors and insurance companies now share their financial information in new ways allowing for greater transparency, helping to inform the public on how health care dollars are spent. • Introduced the State Health Plan, with a goal of making Maine the healthiest state and established new public health infrastructure. • Documented over $111M in system savings. • Established Maine Quality Forum. 12

  15. LESSONS LEARNED /NEXT STEPS • ● Enactment is the easy part • ● “Keep your friends close & your enemies closer” • ● System reform ala High Performing Health System – must remain the focus • ● Voluntary approach required given high cost of health insurance in Maine; mandates rejected – all eyes on MA & VT • ● Next Steps • - Individual market reform / sustainable Dirigo financing • - Non-profit partner – Harvard Pilgrim Health Care • - Annual Cost Driver Study and recommendations to • Legislature 13

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