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11/21/2019 06:05 AM
Pennsylvania State Senate
https://www.legis.state.pa.us/cfdocs/Legis/CSM/showMemoPublic.cfm?chamber=S&SPick=20190&cosponId=27679
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Senate of Pennsylvania
Session of 2019 - 2020 Regular Session

MEMORANDUM

Posted: January 11, 2019 04:09 PM
From: Senator Scott Martin
To: All Senate members
Subject: Medicaid Decision System Health Initiative
 
Last session, I introduced Senate Bill 600, which was designed to improve patient health and reduce the per capita cost of health care for Medical Assistance enrollees. The health initiative would be carried out through an RFP and would be required to save more money than it costs to operate in order to minimize the risk and cost to the Commonwealth.

The desired results would be achieved by increasing patient engagement and understanding of their health care options, improving physician access to the latest evidence based medicine, providing decision support and coordinating physical and behavioral health. By reducing hospital re-admissions, emergency room visits and increasing the use of preventative care, the initiative would improve health care outcomes and reduce overall costs.

It is important to note that this would not replace Managed Care Organizations or primary care providers and would not be a reduction in access or care; rather it would be an additional service to enrollees, which has proven to be successful in other states and in the private sector. If the health initiative were implemented statewide, it could save Pennsylvania an estimated $2-$4 billion.

SB 600 received two hearings, one in each chamber. In the spring of 2017 it was included in House Bill 59 as a regional pilot, which was passed by the General Assembly and ultimately vetoed by the Governor.

Since that time, my office has been working on a number of changes to the bill, chief among them are more specific requirements to demonstrate program savings. It also allows for the state to cancel the contract after 6 months if no savings are reported within that time, as well as extend the program an additional 6 months and beyond provided that savings continue to exceed the cost to administer the initiative.

Pennsylvania ranks 4th in the nation for Medicaid spending at over $28 billion a year. Additionally, the federal share to cover the expansion population continues to decrease in 2019 to 93% and in 2020 to 90%, the difference of which the state will have to make up. In November 2018, the Independent Fiscal Office made the following predictions:
  • Department of Human Services (DHS) general fund expenditures will increase 14.8% in 2019-20 with a nearly 27% increase in Medicaid spending for 2019-20
  • The cost per Medicaid enrollee will increase 3.1% a year
  • DHS will be the largest expense in the state budget in 2023-24, surpassing education
We have an opportunity to improve health care outcomes while reducing costs for one of the largest budget deficit drivers and Pennsylvania needs to act now.

I hope you will join me in co-sponsoring this important reform legislation.



Introduced as SB322