From now through June, the Health Care Cost Affordability Board of the California Office of Health Care Initiate an emergency regulatory process to collect data on costs.
the California Health Care Quality and Affordability Act, or Congress Bill 1130, designed to reduce the rate of increase in costs across the state’s healthcare sector.of 2022 California Health Care Foundation Health Policy Survey found that 83% of Californians surveyed perceive affordability of health care as a very important issue. AB 1130 authorized Gov. Newsom to create his OHCA within the Healthcare Access Information Authority (HCAI). $30 million From his 2022-2023 budget.
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OHCA’s three main focuses include analyzing the healthcare market for cost trends and spending drivers, implementing healthcare cost targets, and conducting cost and market impact reviews of proposed healthcare integrations. included. The Health Care Affordability Board consists of eight members who advise on OHCA’s major activities and endorse certain aspects of the initiative, such as how to set cost targets. The Advisory Board also makes recommendations on behalf of hospitals, organized workers, health professionals, medical groups and purchasers.
of California Hospital Association (CHA) speaks out In September, we discussed the creation of OHCA and how the association played a key role in ensuring that all major parts of the health system are held accountable for reducing cost growth rates.
“Already, CHA has built a team involved in the new office and some are starting to think about the impact the office will have on hospital operations, but this is the first cost increase target. unenforceable, will not be set until 2025,” said President and CEO Carmela Coyle. “Engagement with the advisory board responsible for providing information and recommendations on data reporting requirements and cost targets, as well as the regulators who staff the office, will be a priority for her CHA in the coming years. will be.”
According to HCAI, California’s healthcare spending will reach $10,299 per person in 2020, or $405 billion overall, a 30% increase from 2015. Additionally, Californians with job-based health insurance face increased out-of-pocket costs. The percentage of workers with large deductions ($1,000 or more) has increased from 6% in 2006 to 54% in 2020.
OHCA is responsible for setting overall cost increase targets statewide and specific targets for various sectors of the healthcare industry. The Health Care Affordability Board sets overall health care spending growth targets for per capita spending and specific targets by health sector, including fully integrated delivery systems, geographic regions, and individual health care providers. set goals.
OHCA’s first public report on total health cost data will serve as the baseline for health cost reporting and will cover the calendar year 2022-2023. Payers, including health plans, health insurers, and fully integrated delivery systems, will submit data on total medical costs by September 1, 2024.
Ahead of the data submission deadline, OHCA will obtain input from stakeholders through regulation, develop data specifications and guidance for submitters, and present key findings of the baseline medical cost report at a public board meeting. To do. The baseline report will be released on June 1, 2025. A delivery system fully integrated with payers is then expected to submit total medical expense data on an annual basis.
Cost increase targets will initially be set at the statewide level. To support long-term planning, the Board establishes annual cost growth targets, taking into account multi-year targets. The cost target percentage considers economic indicators such as Gross State Product, Household Income, and Consumer Price Index. The Board may also develop cost targets that apply to specific sectors, such as geographic regions, with sector definitions by October 1, 2027 and sector-specific targets by June 1, 2028. set.
OHCA also sets statewide goals for the adoption of alternative payment models that facilitate a shift from paid services to payments that reward high-quality, cost-effective care. OHCA will measure progress and goals towards adoption of alternative payment method standards. OHCA’s additional responsibilities include monitoring and addressing health care worker stability, and promoting and measuring quality and equity through performance reporting on health care plans, hospitals, and physician organizations.
“While we have yet to see its ultimate impact, the office is indeed helping hospital leaders reduce cost increases, improve access to quality care, and provide services for unmet needs like action. “This could be a key place where we can help authorities understand the competing pressures to strengthen health care and health disparities,” Coyle said.
From June through December 2023, the Advisory Board will begin meetings to develop a statewide cost increase target methodology. Emergency regulations for data collection on total health care costs will also be completed. The board will set the state’s first cost target for 2025 on June 1, 2024.
