5 Things We’re Watching – Alaska, January 2013

This month, we see the start of the legislative session when all things seem possible – both good and bad.  However, a scan of the market highlights a series of opportunities that Alaska providers and consumers appear to have missed.

It’s possible the best strategy is to hold steady.  But, when state government is innovating in health care faster than the private sector – especially in Alaska – it sure seems like some painful changes are in store for 2013.

1. Co-ops get caught up in the fiscal cliff cuts

A local effort to build a co-op health plan in Alaska to operate on the Exchange was dealt a blow this month when Congress cut funds to support the development of co-ops in the state (and all states that were late to apply).

The effort to bring more competition to the insurance marketplace appears to be on hold with national efforts at a legal or political solution limited.  The question is whether the local interest in bringing more choice to the insurance marketplace will further develop, or whether it was limited to this funding opportunity.

2. Struer tells it like it is

This quote from Commissioner Struer caught our attention and thought it was worth repeating:  “We have seen more change in the last year than in the last 20 (in Alaskan healthcare).“  It comes in his department’s annual report.

Talking with Struer makes it clear he is a man focused on innovation wherever possible, rather than where it’s controversial.  And, the rate at which the work is getting implemented – and across silos – makes some in the private sector look stodgy by comparison.


3. Figuring out how to price insurance

After first submitting requests for rate increases of 18-19%, (a request less than many others actually), Premera has decided to withdraw requests for rate increases for 2013.

That swing – going from 19% increase to zero – presages the volatility and difficulty of pricing insurance on the Exchange.  Expect price increases in the individual and small group market to go up considerably in 2014 as the exchange takes shape.

With reinsurance assessments also kicking in on self-insured plans, expect modest rate increases to start as soon as February, 2013, for everyone.

4. Tracking legislation in the 2013 session

The beginning of a legislative session always brings a host of bills that represent ideas on how to improve the health care system.  Bills are getting formally introduced this week, and can be tracked relatively easily online.

At this year’s conference, there was talk about limiting providers’ ability to collect most of their billed charges via a change in statute.  It hasn’t gotten there yet, but we’re watching to see if the question over provider reimbursement makes its way into legislation.


5. The ACO and Sasquatch: 2 things you won’t find in AK

CMS announced last week that is has now certified a total of 269 ACOs nationwide.  More than half of those are led by physician organizations with fewer than 10,000 Medicare patients.  Not one is in Alaska.

Recall that the purpose of an ACO is to foster coordination of patient care.  It supports that coordination with a payment model that compensates providers for working together.

In other words, if providers want to coordinate and collaborate, there is money to support them.  If they don’t, money isn’t likely to change that.