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Improving the Arkansas Health Care System

5 min read

Our health care system is at a tipping point. Arkansans’ insurance premiums have more than doubled in 10 years (from $6,355 in 2000 to $11,816 in 2010), pushing many working citizens into the ranks of the uninsured. One-fourth of 19-64-year-old Arkansans lack health insurance. In some rural counties almost 40 percent are uninsured. However, many of our citizens are not healthy and do need care. According to the Arkansas Department of Health, 53 percent of Arkansas adults suffer from at least one disease, like cancer, heart disease, or diabetes. Most chronic diseases are preventable, but when people don’t have health insurance they tend to avoid seeing doctors. People with untreated chronic diseases get sicker until finally medical care is unavoidable, much more expensive, and usually much less effective.

It’s no wonder that the American Hospital Association reported that the cost of uncompensated care experienced by Arkansas community hospitals more than doubled over 10 years, from an estimated $216 million in 2000 to an estimated $338 million in 2010. With rural counties having a higher proportion of uninsured individuals who cannot pay, should we be surprised when physicians, nurses, and pharmacists don’t want to move there? Will we be surprised when the next rural hospital closes?

Uncompensated care certainly threatens the financial health of our hospitals and clinicians, but they don’t absorb it alone. Arkansas families with health insurance pay an extra $1,500 per year tacked onto premiums to defray the expense of treating those who can’t afford to pay. And, those who can’t pay for their care too often face bankruptcy. The American Journal of Medicine reports that in 2007 medical debt accounted for 62 percent of all bankruptcies, up nearly 50 percent from 2001. The impact of these bankruptcies cascades across communities, affecting businesses that extend lines of credit or loans to these families.

Paying for insurance can be difficult. Arkansas has the third lowest median family income in the country—if you lined up every family from poorest to richest, the middle family makes $38,413 a year (in Maryland it’s $68,933). Most Arkansas families (78 percent) earn at or below 400 percent of the federal poverty level. This means they’ll now be eligible for federal subsidies to help purchase private health insurance or be eligible for Medicaid expansion under the Affordable Care Act.

Although most buy insurance through their employers, many employers don’t offer coverage. Importantly, the Affordable Care Act does not require 95 percent of Arkansas businesses — those with fewer than 50 employees — to do anything. It does require individuals to engage and take responsibility for their future health care costs. At 78 percent, Arkansas has the highest percentage of families in the nation who may qualify for help in gaining coverage.

Arkansas Initiative

With rising costs, an unhealthy workforce, and increasing health care needs, even before the Affordable Care Act, Arkansas embarked on a Health System Improvement Initiative to better meet Arkansans’ needs in four areas:

• Curb rising costs and improve the quality of medical care

• Provide greater access to medical services in underserved areas

• Accelerate use of health information technology

• Reduce the number of uninsured citizens

Payment System Improvement

Arkansas Medicaid has partnered with the two largest private insurance companies — Arkansas Blue Cross and Blue Shield and QualChoice of Arkansas — to change how the state and insurance companies pay for medical care. This promising approach will for the first time “assign” responsibility to a “clinical coordinator” on the “care team” and align financial incentives with outcomes patients expect. Financial incentives are included for providers who achieve quality outcomes for their patients, helping promote coordination among those who provide care. In July, providers began receiving reports outlining how well they met established thresholds for specific episodes of care, such as congestive heart failure, pregnancy, hip and knee replacement and others. Also, Arkansas received a federal Medicare program buy-in when the state was selected to participate in the Comprehensive Primary Care Initiative, which will provide monthly per-patient funding to selected primary care practices to cover the cost of expanded care coordination. For more information, visit here.

Workforce Strategic Planning

For the first time, a strategic plan addresses the growing challenges faced by the health workforce in the immediate and long-term future. The Arkansas Health Workforce Strategic Plan delivered to Governor Mike Beebe in April 2012 is the first step in a larger commitment to ensure that Arkansas’s health workforce will meet the state’s needs. The plan is a roadmap to change that includes specific recommendations to improve navigation and coordination of team-based care, expand the availability and use of technology, increase the supply of and address the mal-distribution of available providers, and adjust the payment system to support these changes. The plan is available here.

Health Information Technology

The backbone of the Health System Improvement Initiative is expanded statewide adoption of electronic health records (EHR) and development of a system that will allow those records to be safely and securely shared. Over half of Arkansas’s primary care providers have committed to EHR and received more than $66 million in federal funding for implementation under the American Reinvestment & Recovery Act of 2009. Nearly 2,000 registered providers and hospitals are in the process of receiving payments. In February, the State Health Alliance for Records Exchange (SHARE) began securely sharing clinical information among doctors, hospitals and labs. To date, more than 1,000 are using the system and another 3,000 are registering. Arkansas is the first state in the nation to receive approval to move forward and implement a sharing network so that those providing medical services to patients will be able to have secure, real-time access to patients’ health records from anywhere patients have been treated. For more information visit www.ohit.arkansas.gov.

Expanding Health Insurance

In compliance with the Affordable Care Act, Arkansas is working to establish an online marketplace, or exchange, where individuals, families and small businesses can find and compare affordable health insurance plans that best meet their needs. The exchange, developed in partnership with the federal government, will include access to federal subsidies to those who qualify based on income. Although it has been politically controversial, this approach promises to increase transparency and competitiveness in the private insurance marketplace. More information can be found here.

These four areas are interrelated. No other state has a more comprehensive and well-coordinated endeavor—bridging public and private sectors—to fix what has become unsustainable in our health system. Although the Affordable Care Act brings changes, Arkansas must commit to taking advantage of the opportunities and avoiding the pitfalls to achieve the health system our citizens need.

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