Can States Harness Market Energy to Rein In Well being Care Prices?

By Christine H. Monahan, Maanasa Kana, and Madeline O’Brien

As U.S. well being care spending continues to spiral up, states are utilizing quite a lot of instruments to push again. This consists of each conventional legislative and regulatory motion, in addition to the federal government’s market energy as a well being care purchaser and different contracting authorities.

In a brand new ebook of essays, Well being Regulation as Personal RegulationCHIR college members study the impacts and limitations of three mechanisms — medical health insurance marketplaces, public option-style plans, and state worker well being advantages packages — by means of which states are leveraging their function as a contractor to decrease well being care costs within the non-public medical health insurance market and advance broader coverage objectives, resembling piloting new cost fashions or enhancing the standard of care and protection. The authors discover that these contracting options are considerably restricted by consolidation within the well being care supplier market. States are additional hamstrung by political strain to not train their market energy in a means that would cut back selections for shoppers. But, contractual approaches can obtain incremental financial savings if the circumstances are proper and, given political obstacles to extra aggressive regulatory reforms, they could be the most suitable choice for some states to behave within the close to time period.

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