Our country faces a time of unprecedented challenges. In Minnesota, as in many states, the economic crisis means that difficult decisions confront us as we grapple with an imminent, extensive budget shortfall. But, this is also a time of great opportunity. As we weather this storm, we can improve the efficiency of our government and our systems so that we emerge stronger as a nation, and as individuals.
The Minnesota way
Blueprint can help nation achieve cost, quality goals
Nowhere is the need for improvement more evidentor more essentialthan in our healthcare system. Spiraling healthcare costs must be contained, even as we strive to improve the quality of care and improve the health of our populations.
This time of crisis is precisely the moment to champion significant reforms. As the Obama administration sets its priorities for healthcare reform, it must address the challenge in a nonpartisan, comprehensive manner. In the long run, it will not work to simply pull more people into a broken system. We must fundamentally transform our healthcare system in order to make it sustainable.
Three core principles to accomplish this are the restructuring of the payment system to better align provider incentives and improve healthcare value, the modernization of the healthcare system to create more efficiency through the use of effective technologies, and the investment in public health to promote healthy behaviors among individuals and prevent future avoidable chronic health conditions.
As health reform is discussed in the coming months, Washington can look to states for innovation in these areas, and Minnesota sets an example. In May 2008, I signed into law a nation-leading, health-reform bill built on those same three principles. Although Minnesota has one of the nations healthiest populations and a historically strong and inclusive health insurance systemboth through employers and public programswe are not immune to the current healthcare systems uneven quality and out-of-control costs.
Between 2000 and 2006, healthcare spending in Minnesota increased more than 60%, from $19 billion to more than $30 billion. Our 2008 health-reform law puts us on the path to achieving significant transformations that ultimately will save the system money (an estimated $7 billion by 2015) and will also improve healthcare quality and Minnesotans health.
The current system of healthcare payment is based on volume rather than value. In todays system, the more you do as a provider, the more you make. Our payment system lacks incentives to improve care quality and actually penalizes providers for keeping people healthy. We need a system that will reward providers for keeping people healthy, instead of only encouraging them to treat the sick. To heal our ailing system, we need to fundamentally reform the way we pay for healthcare.
Our 2008 law represents a crucial first step in this payment reform. It increases the transparency of quality by establishing a single comprehensive set of provider quality measures and establishes a statewide system of quality-based incentive payments to be used by public and private healthcare purchasers. It addresses the uneven quality of care from provider to provider by allowing consumers and healthcare purchasers to compare providers on overall cost and quality.
It also establishes uniformly defined bundled healthcare services that provide an opportunity for providers to innovate on new care-delivery models while holding them accountable for the outcomes they achieve. It creates healthcare homes that focus on patient-centered healthcare experiences with payments for care coordination.
While every other industry has taken advantage of the promise that information technology holds to improve business, healthcare has lagged a generation behind. In healthcare, technology not only makes the business side more efficient, but also it improves the quality of care delivered and prevents avoidable medical errors.
Through Minnesotas e-Health Initiative, we have taken bold steps to accelerate the adoption of health IT. We are requiring that all healthcare providers have electronic health records by 2015 and that those records be certified as interoperable.
Our 2008 legislation also includes the requirement that all healthcare providers and payers use an electronic prescribing system by 2011 in order to improve patient safety and the efficiency of our healthcare system. I have also announced a goal that all Minnesotans have the option of an online personal-health portfolio by 2011, and that all state employees have this choice by the end of 2009.
We are also striving to use technology for routine administrative transactions. Minnesota is the first state in the nation to require all healthcare providers and group purchasers to exchange common healthcare business transactions electronically by the end of 2009. This simple requirement will reduce healthcare administrative costs by more than $60 million a year.
One of the best ways to contain healthcare costs is to keep people healthy. The healthcare costs attributable to obesity and smoking are highand growingboth in Minnesota and across the country. If we truly want to control costs, we must stop adding more people with preventable chronic disease to the healthcare system. That is why our 2008 reforms included a critical investment in public health.
While these efforts may be scaled back because of the economic crisis, we will still have millions of dollars for 2010 and 2011 to fund a Statewide Health Improvement Program to reduce the percentage of Minnesotans who are obese or overweight and to decrease tobacco use.
The goals of our reforms are simply stated: to improve the health of all Minnesotans, to improve the patient experience and to improve the affordability of healthcare. To get there, we are calling for and expecting an unprecedented level of collaboration between the public and private sectors in Minnesota to accomplish marketwide reforms, and this is a model the Obama administration can emulate.
The public and private sectors must work together to move health reform forward, and the federal government should encourage and support the kind of innovation that will allow us to accomplish our common goals. In addition, the federal and state governments must collaborate. For example, Medicare can gain by being a part of regional or state innovations, like ours, and work with states to align payment incentives across the market. Minnesota stands ready to offer our leadership, our learning and our collaboration.
Tim Pawlenty, a Republican, is governor of Minnesota.
Send us a letter
Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.