On Friday, members of the School of Public Health at the University of California, Berkeley hosted a presentation on a recent Research study on a project for a public health insurance scheme, called “Golden Choice”. The plan is designed to increase market competition and improve affordability of coverage over time.
The study was led by school professor Richard Scheffler, PhD, Distinguished Professor Emeritus of Health Economics and Public Policy, and Steve Shortell, PhD, California Blue Cross Distinguished Professor of Politics and Management. Health and Dean Emeritus.
“Our proposal and our plan here is unique in that it builds on the foundations of the delegated model in California, where providers accept full or partial risk, and they get paid to do it – they accept a rate of capitation, which is generally risk-adjusted,” Scheffler said.
The Golden Choice plan would take advantage of California’s healthcare delivery system’s delegated risk model, which allows insurers to transfer some or all of the risk of healthcare delivery costs to medical groups and independent practice associations, or IPA.
According to the brief, which was released Friday morning, California medical groups and APNs have extensive experience operating under delegated risk models. These groups receive a risk-adjusted payment per member per month for each enrollee, which provides organizations with predictable cash flow to develop innovative models of care, while improving patient care.
While many state hospitals and physicians already accept full risk for the full cost of care, others only accept certain occupational risks or only fee-for-service payments. The brief results show that full-risk provider organizations have significantly lower total costs of care and higher quality of care scores than fee-for-service provider organizations.
Health care costs within the state have skyrocketed, with family premiums rising 251% from 2000 to 2021, during which time the average weekly wage has only increased 100%.
“The little story is that health insurance premiums, family premiums, grew two and a half times faster during that time than workers’ wages in California,” Scheffler said, adding that recent inflation n only made the problem worse. “Even with insurance, it often costs too much with copayments and deductibles.”
Scheffler cited a recent California Health Care Foundation study, which found that 52% of respondents skipped or postponed medical care due to cost. Additionally, 52% of low-income respondents reported having medical debt, compared to 28% for other populations.
“More than half of Latinos and nearly half of black people have medical debt, so you can see the deep disparities in how the health care system crosses populations,” Scheffler said.
In the study, researchers assessed the competitive impact of Golden Choice on insurance premiums within the 19 covered California health insurance markets and found that Golden Choice would have the lowest premiums in 14 of the 19 regions. The study also found that across these 14 regions, $243 million would be saved per year, which equates to $1,389 in savings per year per expected enrollee.
“We built a bounty based on IHA [Integrated Health Association] data to test this model in the 19 California regions covered,” Scheffler said.
To predict whether the public option would create competition with commercial plans, the researchers compared the cash premiums of the trading plans to the average total cost of care per member for Health Maintenance Organization enrollees in the database. IHA.
The researchers also increased the Golden Choice premium estimates by 5% and then 10%, which did not change the ranking of the plans. The prototype’s bounty turned out to be the second-lowest bounty on the exchange.
“In all three regions, they were second lowest,” Scheffler said. “As you know, it’s very important to be the lowest of the penultimate, because it matters where most of the entries go.”
During the presentation, Shortell noted that Golden Choice would have a substantial competitive impact on the cost of health insurance and the rate of premium growth in California. The research team has invited proposals from providers who wish to experiment with the Golden Choice public option and aims to connect with CalAIM, which seeks to advance and innovate Medi-Cal, in the future.