New Hampshire chipping away at health care costs

Health care spending has increased faster and reached higher levels in New Hampshire than in most other states, but hospitals, insurers and others have been trying to tackle the problem long before the Affordable Care Act.

The New Hampshire Citizens Health Initiative, which promotes affordable, effective and accessible health care, has overseen several of the largest efforts, including a medical home pilot project in 2011 and an accountable care organization model. New Hampshire also was one of the first states to create a database to collect and aggregate claims from all commercial and government insurers, providing detailed information that informs cost containment efforts, said Jeanne Ryer, the initiative’s executive director.

“New Hampshire is leading the way on this, and we have to,” given the spending trends, she said.

According to the Kaiser Family Foundation, New Hampshire ranks ninth highest in both health care expenditures per capita and annual growth in health care, spending $7,839 per person in 2011, higher than most states but lower than all other New England states except Vermont. Health care spending grew by an average of 7.6 percent a year in New Hampshire between 1991 and 2009, the highest rate in New England.

According to a 2012 report by the New Hampshire Center for Public Policy Studies, New Hampshire’s insurance premiums are among the highest in the country, and health care costs consume a greater share of the state’s gross domestic product than the national average.

Hospital services make up more than a third of total health care spending as they raise prices to cover the cost of new facilities, expensive technology and more staff, the report states. Steve Norton, the center’s director, said hospitals have been squeezed by policy changes at the state level and low Medicare and Medicaid reimbursement rates.

Since the report came out, more hospitals have aligned to avoid duplicative services, he said. Lakes Region General Hospital in Laconia, for example, now sends pediatric cases to Elliot Hospital in Manchester.

Ryer’s group is still analyzing the results of the medical home pilot project, which focuses on a team approach to help patients coordinate information from multiple providers. One of the participating insurers reported costs for patients in the pilot program increased by 5 percent while the costs for other patients increased 12 percent.

The Accountable Care Organization project, launched in 2010, brought together groups of hospitals and health care organizations for a five-year effort aimed at keeping patients healthier while cutting costs. Under the model, one organization — often a hospital or physicians’ group — coordinates health care for its entire community across the health care system, rather than just when the patient shows up at a specific facility. The focus is on a patient’s overall health and preventive care is emphasized.

Ryer said participants get detailed reports culled from electronic medical records and claims data that show how they are doing on dozens of cost, quality and utilization measures. Participants can compare their performance to others and use the information to negotiate contracts with insurers, she said.

Separately, Dartmouth-Hitchcock Medical Center recently completed the first year of an accountable care organization project under the Centers for Medicare and Medicaid Services. Federal officials said in July that the hospital generated $1 million in savings to the Medicare program.

“We’re making progress. I don’t think we always we see all the progress we’ve made because health care costs continue to tick up, but I think we have helped in many ways to do what’s called bending the trend — make it not rise as fast,” Ryer said.

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