Connecticut Gov. Signs Executive Orders Seeking To Rein In Health Care Costs

In the long-running battle against rising health care costs, Gov. Ned Lamont signed two executive orders Wednesday to slow down the rate of medical inflation.

Standing beside doctors, legislators and advocates, Lamont called for creating benchmarks for the growth of health care costs and for the quality of care.

In addition, the order directs the state Department of Social Services to develop a public transparency strategy regarding Medicaid costs and then report back one year from now on its results.

Lamont and legislators called for more collaboration among the various groups in the health care field. State Sen. Matt Lesser, a Middletown Democrat, said the key players all must participate to reduce costs.

“The drug companies blame the hospitals, and the hospitals blame the insurance companies," Lesser said. “Everyone blames each other.”

Although the state has well-regarded hospitals, Lamont said that costs are high, too.

“While several independent studies rank Connecticut’s health care system near the top nationwide, our state also ranks sixth nationally for health care spending and has significant health disparities that we must address,” Lamont said. “Getting these costs under control will help strengthen economic development and will help us attract and retain a talented workforce. These executive orders address major cost drivers and quality concerns for individuals, businesses and in state spending. They expand on our continuing efforts to constrain medical costs, and will improve healthcare quality in the state."

One of the biggest problems is that the rate of medical inflation has grown far beyond the rate of wage growth and inflation on other items. If the medical rate of inflation was applied, the current price of a dozen eggs would be $100, said Vicki Veltri, executive director of the state Office of Health Strategy.

Veltri and others cited a Massachusetts law that was passed in 2012 that requires the creation of a cost report every year and includes public hearings to discuss the findings.

“We know how effective this is in other states,” Veltri said. “Establishing statewide health care cost growth benchmarks reins in health care spending. Health care costs are a major problem for our residents and employers, far outpacing wage growth -- over the past 15 years, families saw the cost of health care rise by 77% while median wage only went up by 21%.”

One of the orders states that the state Office of Health Strategy must create benchmarks by December 2020 for health costs. In addition, the state is setting a goal of spending 10% of all health care dollars on primary care by 2025. The current total is less than 5%.

Last year, the state House of Representatives passed a bill that authorized benchmarks, but it was never debated and died on the last night of the session in the Senate. Senate Democrats have said legislation they’ll propose will include authorization for benchmarking, but the executive order allows the Office of Health Strategy to begin developing benchmarks now.

Even if the legislation fails again, Lamont’s executive order still provides the authority to develop benchmarks, said Vicki Veltri, the health strategy office’s executive director.

In the next 30 days, a board will be established to advise on technical strategy and the methodology to develop the health care cost benchmarks. Experts in health care finance, actuaries and others who can predict cost growth will be on the board, which will include representatives of the health care industry. The members will be hospitals, insurance carriers and consumers, “people who know the ins and outs of health care financing,” Veltri said.

The executive order directs the Office of Health Strategy to develop initial annual benchmarks for 2021 through 2025.

State Rep. Sean Scanlon, a Guilford Democrat who is among the legislature’s leading authorities on health care, said the work is not easy and can only be done in the long term.

“There’s no one silver-bullet solution to lowering the cost of health care in Connecticut,” Scanlan said. “The people in the state of Connecticut want us to get this done, and they don’t care who does it or who gets the credit. They just want to see progress and lower costs.”

State Sen. Saud Anwar, a South Windsor Democrat who is also a medical doctor, said, “While Connecticut’s strong health care resources are among the best in the country, I hear far too often from my constituents that health care costs are growing at an untenable rate. I applaud Gov. Lamont’s signing these executive orders to restrain future spending hikes. In Massachusetts, a similar model of health care cost growth benchmarks saved that state more than $5 billion since 2013.”

Courant staff writer Stephen Singer contributed to this report.

Christopher Keating can be reached at [email protected].

___

(c)2020 The Hartford Courant (Hartford, Conn.)

Visit The Hartford Courant (Hartford, Conn.) at www.courant.com

Distributed by Tribune Content Agency, LLC.