The South Carolina Health Planning Committee completed months of work with its release of a report (Improving the Health Care Marketplace in South Carolina) last week to Governor Haley recommending that South Carolina not create its own health insurance exchange as provided for under the Affordable Care Act. At first glance, this may come as a surprise to many, since the ACA calls for the federal government to operate an exchange in any state that chooses not to create its own. And the SC Department of Insurance had been awarded a $1 million planning grant on September 30, 2010, to determine the feasibility of establishing a state exchange. But the Committee ultimately decided not to recommend creation of state exchange for the following reasons:
- No final rules for operation of a state exchange exist.
- Implementation timelines are not achievable.
- DHHS is the only organization capable of implementing the requirements of a state-based exchange, but its resources and management capacity are fully committed to improving the current Medicaid program and preparing for the expansion required by the ACA.
Instead, the Committee recommends that the state should encourage the establishment of multiple private exchanges for consumers to use in comparing and selecting a health insurance product to meet their needs. Just as an individual might use Travelocity or Orbitz to compare and make travel plans, consumers should be able to turn to private exchanges and compare health providers and plans on the basis of both quality and price.
What’s really interesting is what else the Committee recommends. While the 12 member committee created by Executive Order on March 10, 2011, did not include a hospital representative, SCHA made presentations before the Committee and was represented on each of the four subcommittees that were formed to deal with issues around: consumer protection/medical liability, information technology, competitiveness & transparency, and consumer driven health plans. And as you can tell from how the committee organized its work, the recommendations contained in the final report extend well beyond the basic question of whether SC should create its own insurance exchange:
- Creation of an independent, multi-stakeholder body to implement a provider and health plan quality & performance reporting strategy
- Removal of any legal or regulatory barriers preventing employers and health plans from providing financial or other incentives to employees or beneficiaries who choose high value health plans and providers based on quality and price.
- Request for legislative review of the possibility of:
- Clarification of peer review statute
- Limiting hospital liability for actions of independent contractors
- Creation of “safe harbors” for providers following approved “checklists” or clinical protocols
- Mandating consumers be provided written cost estimates before health care services are provided
- Revising current scope of practice laws and regulations.
What’s important to note is that the Committee urges that “any changes in the funding or provision of healthcare services should be in the context of a goal to improve the health status of South Carolinians, improve the quality and experience of healthcare services, and to do this in a fiscally responsible way that will reduce the per-capita cost of healthcare”—the same Triple Aim platform adopted by SCHA and the other stakeholder groups working with us to reengineer how health care is delivered in our state.