# Presentation: 024270

## Roles of State Legislatures and State Government in Determining Health Care Policy

**John E. McDonough, Dr.PH., M.P.A.**
**Executive Director**
**Health Care for All**
**Massachusetts House**** of Representatives (1985-97)**

## SESSION OUTLINE

**Three Pillars of Health Policy**
**Four Eras in U.S. Health Policy**
**Eight Key State Government Roles**
**Federalism and Health Policy**
**Your Role in All of This**

## I. Three Pillars of Health Policy

**Cost**
**Access**
**Quality****	****	****	**
***Everything***** you do affects at least one, and frequently two**
**Health policy home run – positively influence all three**
**Childhood Immunization**
**Most of the time, *****pick any two*****...**
**	****	****	****	****	****	****	****	****	****	****	****	****	**

**Notes:**
1. Everything and anything you do in in health policy affects at least one, often two, frequently all three
2. Saying: Q-A-C -- pick any two
3. Health Policy Home Run -- if you can clearly and positively affect all three with the same measure: ie: a childhood immunization program

## Costs: The Big Picture (1)Health Spending in $$$ and as Percent of US Economy

## Costs: The Big Picture (2)Increases in Premiums vs. Earnings and Inflation

**Notes:**
This is the same as Hurley’s slide #21 (MK)

## Costs: The Big Picture (3)U.S. Health Spending vs. Other Industrialized Nations

-    _U.S. Health Rankings_:
- Infant Mortality: 28th
- Life Expectancy: 24th
- Births to Women
- 	Ages 15-19 in Industrialized Nations: 30th
- Measles Immunization: 14th

**Notes:**
Label the 0-120 axis (MK)

## Access: 45 Million Uninsured Americans

## Quality: The Disturbing Picture 

## Four Health Policy Eras

**Era I: Pre/Emerging System Period**
**Pre-1910s****	****	****	****	****	**
**Minimal licensure and professional standards **
**No health insurance as we know today**
**Minimal public investments****	**
**No standards for medical education**
**Infectious disease leading cause of death**
**Life expectancy ~46 years**
**See *****The Social Transformation of American Medicine – *****Paul Starr**

**Notes:**
1. Every regulatory intervention is a product of its era
2. P. Starr’s STOAM.   Presentation of 19th century medicine
3. The struggle of allopathic physicians against others. 
4. 1910 Flexner Report for single standard of science based tchg; 1915 Rock. Fd Report for science based PH schools; biological paradigm for disease--germ theory, antibiotics

## Four Health Policy Eras

**Era II: Professionalization and Growth**
**1910s to 1960s****	****	****	**
**Scientific breakthroughs****	****	**
**Widespread licensure, professional standards, public sector regulation**
**Development of modern health insurance and insurance regulation****	**
**Federal Support: medical education, facilities, research**
**Emergence of chronic disease as leading cause of death**

**Notes:**
1. Focus on curative medicine
2. Much of the regulatory infrastructure set up in this period
3. Blue Cross plans in 1930s; WWII ruling that emplyr health $ was not deemed taxable income; commercial insur. Late ‘40s-- experience rating
4. Slowdown in infectious disease: shift to cancer & heart
5. The war metaphor

## Four Health Policy Eras

**Era III: Government Regulation**_** **_
**1965 to late 1980s (life expectancy ~70s)****	**
**Creation of Medicare & Medicaid in 1965**
**Market failure as defining metaphor**
**Cost control as major public priority****	**
**Government/business partnership**
**Key instruments to address market failure: **
**Certificate of need**
**Health system planning**
**HMO Act**
**Hospital rate setting**

**Notes:**
1. M&M made government a key finance engine -- and gave feds and states a strong stake in cost control
2. Growing employer concern
3. New metaphor: market failure -- key attributes of health market missing because of insurance & employers
4. Reg. Apparatus created to address market failure

## Four Health Policy Eras

**Era IV: Market Dominance**
**1990s through today**
**Key idea: market failure can be corrected**
**Phase I: The managed care revolution**
**Led to backlash and retreat**
**Growth in investor owned health entities**
**Major provider consolidations**
**Different role for government**
**Phase II: Era of the consumer **
**Health savings accounts (“skin in the game”), transparency, public data release****	****	**

**Notes:**
Slide ends in comma, is something missing? (MK)

## What’s Next?

- “The solution is not a government-run system or a fend-for-yourself marketplace but, instead, a new approach that combines the best care options offered by the private sector backed by the resources and oversight of Federal and State governments.” Sen. John Breaux (D-La.), on his proposal for universal health coverage
- Still waiting...

## Key State Government Roles in Health Care

**Public Health**

**Facility/Professional Regulation**

**Regulation of **
**Insurance/HMOs**

**Health Workforce**
**Education Training**

**Provide/Finance Service**

**Cost Containment**

**Information**
**Dissemination**

**Health System**
**Monitoring**

## Key State Roles: I

**1.****	****Public Health**
**	****Population health, disease control and prevention, sanitation, environmental protection, bioterrorism**
***Schism with Clinical Medicine***
**2.****	****Regulation: Facilities and Professionals**
**	****Licensure: e.g., hospitals, nursing homes, clinics, physicians, nurses, social workers; scope of practice; discipline**
**Joint Commission on Accreditation of Healthcare Organizations; Certificate of Need**
***From Quality Assurance to Quality Improvement***

**Notes:**
YOU ARE RESPONSIBLE FOR ALL
The Air Pilot Metaphor: licP & F, reimb, anti-trst, wrkfrc, med ed ++
1. IOM88:Future of PHealth:  basics: hlth stat assmnt, policy dvlpmnt, assur of pers., educ, & envir hlth service.  
PH pigeonholed into indigent care
2. Medicine & Public Health Initiative
3. Application of indus QI to health care: error reduction movement, evidence based medicine.  Systems, not people -- can govt. change?

## What is Quality?

**Quality of care is the degree to which services *****for individuals or populations***** increase the likelihood of desired health outcomes and are consistent with *****current *****professional knowledge.**
**	****―**** *****Institute of Medicine, 1990******	******	******	******	***
**Quality is doing the right thing and doing it right.**

**Notes:**
No one knows how to define Q: 
1. IOM 1990 report on Medicare; 2nd is definition to memorize
2. Kinds of poor quality: underuse, overuse, misuse
3. Error is rampant, 50,000-100,000 deaths per year from errors; IOM report

## Key State Roles: II

**3. Regulation of insurance and HMOs**
**	****Solvency concerns, consumer protection**
**	****ERISA (Employee Retirement Income Security Act of 1974 – your 800 lb. gorilla)****	****	**
**4. Health workforce education**
**	****Support for medical education, State medical schools, other professionals**
**	*****How to finance fairly in managed care environment and tight fiscal times?*****	**

**Notes:**
1. Govt. has compelling concern to ensure that consumers are protected from scam artists, irres. Firms, etc.  Concern that ICs too much solvency
2. Medicare is major med. educ. Engine via: DME, IME; states also via Medicaid
3. Med Schools -- financing support; states try to use strategically, ie, primary care.  Mcare challenges.

## Key State Roles: III

**5. Provision/financing of health care services – *****Make/Buy?***
**Medicaid: fee for service/gatekeeper; managed care/capitation **
**State worker/retiree health insurance****	****  **
**Indigent services: public hospitals, clinics, uncompensated care****	**
**Health coverage expansions****	**** **
**Other services: mental health, mental retardation, veterans, other disabilities**
**Pharmaceutical assistance**

**Notes:**
1. 800 pound gorilla
2. Old model: state facilities & programs.  New: state as purchaser.  
3. Even Medicaid: old--ffs, new--buy coverage from plans/or gatekeeper. From passive payer to prudent purchaser
4. About 13 states help citizens buy prescription drugs

## Key State Roles: IV

**6. Cost Containment**
**  ****	*****What can government do about rising costs (premiums, prescriptions)? ***
***Pay for Performance  ***
***Evidence-Based Medicine***
**7. Information Dissemination**
**	****Public reporting on hospitals, physicians, nursing homes, HMOs. *****Who gets what?***
**8. Health System Monitoring**
**  ****	****Anti-trust & mergers, malpractice, for profit conversions, specialty hospitals. *****When to intervene?***

**Notes:**
Revise so “For Profit is on same line” (MK)

## Federalism & Health Policy

_**1960 and 1970s**_**:**** Mandates and limited discretion, i.e., Medicaid, Employee Retirement Income Security Act of 1974 (ERISA)**
_**1980s**_**:**** Transition, i.e., New Federalism, block grants, Boren, Waxman**
_**1990s and 2000s**_**:**** Partnership, i.e., Medicaid waivers, HIPAA, SCHIP**
**Is the partnership beginning to fray?**

**Notes:**
Change i.e. to e.g. (MK)
Would be nice to have a conclusion slide—perhaps a summation that illustrates the importance of various roles that states play in health (MK)

John should leave them with a take away message about the importance of serving on a health committee. Many years ago, on a panel before mostly freshmen legislators, John gave one of the most inspirational ten minute speeches I have ever heard. It was all about how politics, despite public cynicism, is really a noble calling. How politics is all about deciding "who gets what" through peaceful means. I have the tape if he doesn't recall what I'm referring to, but I'm sure he will. I would love to see him repeat those messages at the end of his speech. I think it would be very well received -- and it's a completely bipartisan or actually nonpartisan message (DM)

## Your Role in Making Health Care Work in Your State

**The Job of a Legislator (Fenno, 1978)**
**Being one of them**
**Getting around, soliciting advice, relating to culture **
**Providing services**
**Helping constituents, organizing community initiatives**
**Acquiring resources**
**Using prerogatives to obtain resources**
**Expressing policy views and interests**
**District/Personal**

## Your Role in Making Health Care Work in Your State (cont).

**What is politics?**
**The way we decide “who gets what” without resorting to violence**
**What is health care politics?**
**The way society decides “who gets what” **
**The culture says: Politics is bad/corrupt**
**Bob Kuttner says: “...Politics is the practice of democracy in real life”.**
**This is your turn, your moment**