A new study from consulting firm Altarum finds that states are falling short in the area of improving health care affordability. The study outlines a range of steps that could improve coverage and affordability of health care, at a time when coverage has improved but affordability remains a challenge.

The Health Care Affordability State Policy Scorecard ranks 42 states and the District of Columbia (lack of data kept some states from being ranked), and found that Massachusetts, Maryland, Oregon, Minnesota, and New York made up top five states for affordability. Nevada, Idaho, Georgia, Oklahoma, and Mississippi ranked the lowest.

However, the study noted that every state had room for improvement, and that some areas were hard to quantify, such as addressing the problem of low-value care. In addition, some states rank high in both health care spending and affordability, suggesting that the states have policies that keep the consumer costs down while still spending more on health care overall.

Coverage—the first step

The Altarum study notes that in order to have affordable health care, Americans must have health insurance coverage. "Health insurance makes a difference in whether and when people receive necessary medical care, where they get their care and, ultimately, how healthy they are," the study noted. "Uninsured people are far more likely than those with insurance to postpone health care or forgo it altogether."

The study had a list of recommendations for improving coverage that included:

Expand Medicaid to 138 percent of the Federal Poverty Level (FPL)—"Strong evidence suggests that expanding Medicaid to all residents improves health outcomes, financial security and contributes to economic prosperity in a state," the study said.
Provide coverage options for residents with incomes above 138 percent of FPL—a step that could provide options for consumers who make too much for Medicaid coverage, but still struggle to find insurance.
Provide coverage for recent and undocumented immigrants—a suggestion that could be controversial, but the report said expanding coverage will improve public health.
Stronger rate reviews—the study recommended state regulators follow the example of California and Massachusetts during the rate review process, putting an emphasis on improving coverage and affordability.

Affordability—a growing challenge

The report agreed with other recent studies: Americans are struggling with affordability of health care across the board.

"Health care affordability problems cause stress and anxiety for families, crowd out other critical family spending, and lead to poorer and less equitable health outcomes," the study said. "Evidence of widespread problems goes far up the income ladder and affects people of every stripe."

The recommendations in this area included:

Protect consumers from inadvertent, surprise out-of-network medical bills—states are limited in what they can do for self-insured plans, but the report noted that the issue has raised concerns, with 27 states taking steps to protect consumers against surprise bills.
Protect consumers from short-term, limited-duration (STLD) health plans—STLD plans are promoted by some as a low-cost option, but the report noted that these plans fail to offer many protections provided by ACA-compliant plans. "As a result, out-of-pocket limits may not include what consumers pay for deductibles and copays; the plans may limit coverage for doctor visits and prescription drugs; and they do not cover pre-existing conditions," the report said.
State mandates that waive or reduce cost-sharing for high-value service—"Failure to receive high-value care like flu vaccines, certain cancer screenings and other select services not only worsens health outcomes but can result in higher spending on medical care," the report said.

The report also looked at several other areas that affect health care affordability: addressing low-value care, curbing excess prices, improving transparency, and using all-payer or multi-payer claims databases.

The Altarum study concluded by saying states have shown the ability to address health care coverage and cost issues with prudent policy decisions. "The scorecard shows that state policy makers have a robust tool set they can use to ensure all residents have affordable coverage that features consumer-friendly cost-sharing and premiums that reflect the efficient delivery of health care and fair health care pricing," the report said.

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States coming up short on health care affordability

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