Cost control efforts thrive at state level

The United States is unlikely to rally as a nation to better control healthcare costs, but individual states have embarked on initiatives that have shown varying degrees of effectiveness, according to a new report by the Center for American Progress.

"The current political environment makes it unlikely that reforms to control systemwide healthcare costs will be achieved at the federal level in the near future. States, however, are well-positioned to take the lead on implementing cost control and quality improvement reforms," a statement accompanying the report said.

Among the examples: Maryland's global cost controls for hospitals; bundled payments for all payers (Arkansas, Tennessee, Ohio and Delaware); reference pricing (California); some forms of price transparency (New Hampshire and Massachusetts); and all-claims databases (Maine, Colorado, New Hampshire and Washington).

Reference pricing by CalPERS, California's public retirement system, was able to save $5.5 million on joint replacement surgeries in just a couple of years. Maryland' global budgeting program saved $100 million in its first year of implementation and is also credited with lowering the statewide readmission rate.

The report noted that Maryland's efforts kept cost growth on the hospital end at 1.5 percent in 2014, far lower than the 3.58 percent set by Maryland. And all-claims payer databases could cut commercial medical spending by 11.5 percent and Medicaid spending by 5.7 percent, although legal challenges in Vermont have raised doubts about their implementation.

To learn more:
- read the report
- here's the CAP statement