Colorado Commission on Colorado Commission on Affordable Health Care Affordable Health Care 2017 Final Report June 30, 2017 Table of Contents Letter from the Chairman ........................................................................................................ 3 Commission members ............................................................................................................. 5 Recommendations .................................................................................................................. 7 Introduction .......................................................................................................................... 15 Defining Cost, Price, and Spending ................................................................................................... 15 Shared Framework and Approach .................................................................................................... 16 Level Setting ....................................................................................................................................... 16 Market Advisory Committee ................................................................................................. 19 Topics .................................................................................................................................... 21 Rural Health Care Costs ......................................................................................................... 21 Recommendations ................................................................................................................ 29 Telehealth .............................................................................................................................. 30 Pharmaceuticals .................................................................................................................... 33 Recommendations ............................................................................................................................. 37 Substance Use Disorder and Mental Health ........................................................................... 38 Recommendation .............................................................................................................................. 42 Free-Standing Emergency Departments ................................................................................. 43 Recommendations ............................................................................................................................. 46 Transparency ......................................................................................................................... 47 Recommendations ............................................................................................................................. 49 Social Determinants of Health ............................................................................................... 50 Recommendations ............................................................................................................................. 54 Direct Primary Care ............................................................................................................... 55 Recommendations ............................................................................................................................. 56 Transparency related to End-of-Life Care ............................................................................... 58 Recommendations ............................................................................................................................. 60 The Affordable Care Act and its impact on Colorado’s Health Care Costs ............................... 61 Other Topics .......................................................................................................................... 63 Balance billing and adequate networks............................................................................................ 63 Social Investments ............................................................................................................................. 64 Next Steps ............................................................................................................................. 65 Glossary................................................................................................................................. 68 Appendix A – Legislative Charge of the Commission .............................................................. 72 Appendix B – Market Advisory Committee Recommendations .............................................. 76 Appendix C - Minority Comments .......................................................................................... 80 Endnotes ............................................................................................................................... 91 CCAHC Report to the Colorado General Assembly and Governor’s Office | 2 Letter from the Chairman June 30, 2017 Governor John Hickenlooper Representative Joann Ginal Office of the Governor Chair, House Committee on Health, Colorado Capitol Insurance, and Environment 200 E Colfax Ave. 200 E Colfax Ave. Denver, CO 80203 Denver, CO 80203 Senator Jim Smallwood Representative Jonathan Singer Chairman, Senate Committee on Health and Chairman, House Committee on Public Human Services Health Care and Human Services 200 E Colfax Ave. 200 E Colfax Ave. Denver, CO 80203 Denver, CO 80203 Gov. Hickenlooper, Senator Smallwood, and Representatives Ginal and Singer, On behalf of the Commission on Affordable Health Care I am pleased to present you with our third and final report. This report builds on the Commission’s November 2015 and November 2016 reports, which explored the major cost drivers within the health care system, and includes specific recommendations regarding these cost drivers. These comprehensive set of reports are intended to help policy makers assess the areas most in need of further study and possible intervention. The Commission spent three years exploring potential strategies to confront rising health care costs in Colorado. In doing so we heard from local officials, providers, community and business leaders, hospital administrators, and insurers throughout the state. We also explored what some other states have been doing. Therefore, this report lays out a series of avenues for consideration and potential action. Addressing the rising cost of health care is a complex matter — and one of great interest to many throughout the state. We urge you and your colleagues in the General Assembly to neither rush to judgement when attributing cause for the rising costs, nor in developing legislative solutions. Every facet of our health care system is connected. Pulling on one string to attempt to reduce the overall cost can create unintended market reactions, possibly making matters worse. This report highlights the need for accurate data to base recommendations on, and the challenge of having solid analytics that can help define the impact of any future actions. CCAHC Report to the Colorado General Assembly and Governor’s Office | 3 Some of the trends the Commission explored may require actions that go beyond the authority of the Centennial State. Therefore, the Commission is making a few recommendations for a consolidated, continuous, and thoughtful interaction with our congressional delegation in order to request federal action to address such broader matters. These areas are also identified in the report. On the other hand, Colorado does have the ability to impact many of the issues Identified in our report, and we have suggested regulatory and market approaches to address these areas. Examples of areas of particular note include: issues related to rural health care costs; the value of preschool education for children within the Medicaid population; and the problem of substance abuse in Colorado. It should be noted that each of our recommendations received the prescribed minimum two- thirds majority among the Commissioners. These recommendations are the culmination of three years of work and start on page seven. There are areas that we were unable to tackle due to time limitations. These areas for future review and analysis are identified on page 63. Respectfully submitted on behalf of the Commission. William N. Lindsay III Chairman, Colorado Commission on Affordable Health Care 2017 CCAHC Report to the Colorado General Assembly and Governor’s Office | 4 Commission members Legislative Charge — Elisabeth Arenales of Denver, from an organization Senate Bill 14-187 representing consumers and understands consumers with chronic medical conditions Jeffrey J. Cain, M.D., FAAFP, of Denver, a health The Mission of the Commission is to ensure care provider who is not employed by a hospital that Coloradans have access to affordable and who is a physician recommended by a health care in Colorado. statewide society or association The Commission shall focus its Rebecca Cordes of Denver, representing large, self- recommendations on evidence-based cost- insured Colorado businesses control, access, and quality improvement Greg D’Argonne of Littleton, with expertise in initiatives and the cost-effective expenditure health care payment and delivery of limited state moneys to improve the health Steve ErkenBrack of Grand Junction, representing of the state’s population. carriers offering health plans in the state Powers and Duties of the Commission: