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It’s getting interesting out in Colorado. As the legislation laying out Colorado’s public health insurance option gets ready to drop, the hospital industry is proposing to submit to greater public scrutiny as an alternative to price setting. The hospitals defeated an attempt to include price-setting in the state’s marketplace reinsurance program last year, but it may be getting harder to turn back the tide.
Colorado hospitals hate the plan to cap their prices. Here’s how they want to control health costs instead.
Colorado hospitals hate the plan to cap their prices. Here’s how they want to control health costs instead.
As Democrats at the state Capitol near the introduction of the long-awaited and hugely controversial bill to create a public health insurance option, Colorado hospitals on Tuesday unveiled their counter offer.
Their proposal is a “total-cost-of-care” model — essentially a big health spending budget for the state. An independent commission would be charged with setting a target to limit how much health care spending in the state can grow each year. . .
It is also, clearly, the hospitals’ attempt to steer lawmakers away from a public insurance option, which many hospitals despise because it will likely give regulators the ability to tell hospitals how much they can charge people covered by the public option.
The hospitals’ proposal is based on programs already running in Oregon and Massachusetts. In the Colorado version, the governor and lawmakers from both parties would appoint members of an independent commission, which would scoop up a whole bunch of data and come up with a calculation of how much everyone and everything in Colorado spends, in total, on health care in a year.
Then it would set the goal for how much health care spending can grow over the next year, a target that applies both to the state as a whole and every entity within the system. In Massachusetts, for example, the state set its growth target for 2018 at no more than 3.1%.
Hospitals, insurance companies and other health care entities in Colorado that exceed the target would first have a discussion with the commission about why — and then could progress to being hit with public hearings and a formal improvement plan. But there’s no provision in the draft bill that would allow the state to, say, revoke a hospital’s license if it doesn’t rein in costs.