1. Dirigo Health Reform COST, QUALITY AND ACCESS: A SYSTEM APPROACH Trish Riley, Director Governor’s Office of Health Policy and Finance State of Maine 1

2. Overview Goal: Sustainability -Achieve universal access for all Mainers by making health care more affordable and of high quality. -Begin with a voluntary, public/private approach. 2 2

3. Need for Reform 140,000 uninsured – 80% work in small business or are self-employed; 75% below 300% FPL. Family premiums rose 77% between ’96 and ’02. Median household income rose 6%. We pay higher percent of our income on care than 45 other states. 3

4. Need for Reform High rates of chronic illness. $200 million in bad debt and charity care – 30% from people with insurance. High rates of utilization. High hospital costs. Lowest rate of employer sponsored insurance and highest rate of uninsured in New England. 4

5. Cost Containment CON and Capital Investment Fund & State Health Plan Voluntary Expenditure Targets Transparency – Price Posting Insurance Reforms Hospital Study Commission End “hidden tax” of bad debt and charity Enhanced public purchasing Single portal for providers to access eligibility, benefit and claims info from multiple insurers 5

6. Quality Improvement Maine Quality Forum State Health Plan - Make Maine the healthiest state in the nation Pay for Performance – Public Purchasers All Payor Data Base Statewide EMR 6

7. Increased Access Dirigo Health Agency DirigoChoice - Anthem Small business, self-employed, individuals Discounts for employees Modest MaineCare Expansion – Eliminate cliffs Comprehensive coverage – 100% prevention, no Pre-X, Mental Health Parity, Healthy Me Rewards Commercial Rate Reimbursement 7

8. Affordability Discount Program Dirigo Choice Monthly payments and deductibles based on ability to pay to 300% FPL Marketplace Trend B Deductible $1,250/$1,750 B Discounts reduce average deductible to $850 Employer must pay 60% of employee share System Reforms 8

9. Discounts – To 300% FPL $1,250 Deductible ABCDEF Monthly Discount 100%80%60%40%20%None Deductible Single $025050075010001250 Family $05001000150020002500 Out of Pocket Single $08001600240032004000 Family $016003200480064008000 9

10. Financing DirigoChoice DirigoChoice is self-financed through pooled revenues: Member and employer payments $53 million state funds in 1 st year Savings Offset Payment – linking cost containment and access MaineCare for those eligible 10

11. Early Success 8,100 Enrollees in 7 months 2,000 Maine businesses (1,300 sole proprietors + 650 small businesses) Selling statewide 11

12. Challenges Linking access expansions to cost constraints -Public health improvements and quality initiatives take concerted effort over a long period to yield results. -Reluctance to embrace short term, more immediate cost containment. 12 1212

13. Challenges -“Tough Choices” campaign (Hand-out Attached) ▪ AmericaSpeaks – Neutral facilitator ▪ Random sample selection of Maine citizens ▪ 1 day, 2 sites – “Town Hall Meeting” – Interactive ▪Conclusion: It’s tough to make tough choices. -Need continuing dialogue – State Health Plan 13

14. Challeges Financing Limits of voluntary approach 14

15. Roles for Federal Government Cover Uninsured Federal roles - Support state initiative with financing - Federal-State partnerships to cover those unlikely to afford private options (< 200%? 300% FPL) Use Medicare & Medicaid - Consistent & timely data - Quality measures - Address perceived cost shifting - Simplify eligibility pathways for Medicaid 15

16. More Info www.dirigohealth.maine.gov GOHPF: (207) 624-7442 or GOHPF@maine.gov 16