1. Overview of Health Reform Activities in Minnesota
Sanne Magnan, M.D., Ph.D.
Minnesota Commissioner of Health
SCI Annual Meeting
August 5, 2010 1

2. Minnesota’s Vision GOALS – the “Triple Aim” Improve population health
Improve the consumer/patient experience
Improve affordability
RESULT
A better state of health 2

3. Rising Health Care Costs in Minnesota
In Minnesota we spent nearly $31 billion in health care in 2006 and $32 billion in Projections released by MDH show that, if left unchecked, that amount could rise to $78.5 billion in 2018.
Total health care spending in Minnesota up nearly 70% between 2000 and 2007
Incentives are misaligned today. Health care providers are not paid to prevent expensive complications of chronic disease. Some providers that have chosen to invest in chronic care management on their own have lost money by keeping people out of the hospital.
Rising health care costs in the state are unsustainable.
Our health care system creates poor value and has misaligned incentives.
The way we pay for health care services leads to distortions in the types of health care that gets delivered.
Source: Minnesota Department of Health, Health Economics Program 3

4. If State Health Care Costs Continue Their Current Trend, State Spending On Other Services Can’t Grow
General Fund Spending Outlook, presentation to the Budget Trends Commission,
August 2008, Dybdal, Reitan and Broat 4 4

5. Quality is Improving, but Uneven
Minnesota Optimal Diabetes Care Measure
Quality is uneven. Only one in six people with diabetes in Minnesota gets what the medical community considers to be optimal care. Even the best clinics have room for improvement.
Health care quality is low relative to the amount spent, and unevenly distributed across the population.
Rising health care costs in the state are unsustainable.
Our health care system creates poor value and has misaligned incentives.
Private insurance continues to erode, and the number of uninsured is rising.
The way we pay for health care services leads to distortions in the types of health care that gets delivered.
Source: Minnesota Community Measurement 5

6. The Challenge in Health Care
“We spend too much for what we get.”
T. Marmor, J. Oberlander and J. White writing in
Annals of Internal Medicine (April 7, 2009)
In other words, we have a
poor value equation:
the quality for the dollars spent.

7. Minnesota’s History of Collaboration and Innovation
Health Reform law was passed by Minnesota Legislature and signed into law by Governor Pawlenty in May 2008
Outgrowth of years of work in Minnesota by policymakers and health care organizations
Groundwork for the law began in 2007, with legislative and governor’s task forces that made recommendations to:
Improve population health
Better coordinate care for those with chronic and complex health conditions
Make advances in coverage
Improve transparency
Lower administrative cost
Better involve the patient and individual
Reform how we pay for health care 7

8. Minnesota’s 2008 Health Reform Law: Building Blocks
Lays a foundation for redesign of care and payment.
Moving upstream: SHIP (Statewide Health Improvement Program)
Care redesign and payment reform: health care homes, baskets of care
Market transparency: provider peer grouping, quality reporting 8

9. Supporting Activities
E-health
Interoperable health records by 2015
Meeting health information exchange requirements
Administrative simplification
Electronic transactions using a standard format and content
Consumer engagement
Cost and quality of health care

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