Putting Michigan Back to Work

The First Steps

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Section 7: Health Care

A Healthy Michigan: Affordable and Accessible Health Care

For families, employers, and individuals, health care expenses are growing out of control. One of the most expensive elements of health care is the cost of presiption drugs. In 2004, Attorney General Cox first called on the Department of Community Health to establish a presiption drug cost website to give seniors and the uninsured the ability to "comparison shop" by going online and compare drug prices. In spite of the savings and benefits, the Granholm-Cherry Administration balked.

Over the course of the next three years, Cox directed his office to undertake three surveys of the cost of presiption drugs. Each survey examined costs in ten separate communities statewide and found major cost discrepancies for the same drug, same dosage, even in the same city. In some cases, prices varied by as much as $100 for the very same drug and dosage in the same community.

After pressure from Cox, the media, AARP, and seniors, the Governor's Department of Community Health finally relented and agreed to post 150 presiption drug prices on www.michigandrugprices.com. This website allows citizens anywhere in Michigan to compare prices on commonly prescribed drugs. The potential savings are huge, especially for seniors. An Attorney General's office survey determined the average savings per presiption can yield up to $77. As AARP notes the average senior takes four presiption drugs monthly. As a result, the website has offered countless Michigan seniors the ability to save thousands of dollars every year.

Oversight of Health Care Costs

One of the issues of greatest importance to Michigan's residents and businesses is the affordability and accessibility of health care. As Attorney General, Mike Cox has fought to increase health care access for all the people of Michigan. Last year, he spearheaded the effort to stop Blue Cross' attempt to monopolize the health care market and abandon its traditional mission as the non-profit insurer of last resort. Teaming with groups as varied as the UAW, Consumers Union, and AARP, Cox created a coalition focused on fighting for access and accountability.

The Blues plan sought to increase Blue Cross' ability to hike rates on seniors, new customers and individuals without oversight; increase Blue Cross' "profit" margin; and destroy any competition that would keep pressure on Blue Cross to lower its prices. As a result of the AG's leadership, the bills were killed.

Earlier this year Cox outlined a set of ten guiding principles for the Legislature to build a foundation for long-term health care reform. Included among the reforms are maintaining the oversight roles of the Governor and AG; shortening the time that pre-existing conditions are excluded from coverage; creating a catastrophic health care fund to assist those most in need; and creating an annual health care cost report so Michigan can compare its health insurance costs with those of the rest of the nation. This package of principles provides lawmakers with options for controlling costs and expanding health care coverage to those who need it most.

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29. Expand the Drug Website to Include Pricing Information on 300 Most Commonly Used Prescription Drugs and Generics

Right now, www.michigandrugprices.com, the Website that allows Michigan seniors and consumers anywhere in Michigan to compare prices on commonly prescribed drugs, is a first step in helping seniors and the uninsured to save thousands of dollars. Mike Cox has always been a proponent of providing more information, but has faced resistance from the Granholm-Cherry administration. As Governor, Mike Cox will double the number of prescription drugs on the Website and include generic drug pricing as well. Mike Cox is committed to providing consumers with as much information as possible.

30. Expand Health Insurance Pooling Options for Citizens in the Private Sector

Mike Cox supports the expansion of health insurance pooling options for those Michiganders who are covered by small employers or buying their own insurance. As outlined in his January letter to the Legislature, Cox supports studying changes in the health insurance market to potentially pool those individuals who now buy their own insurance with so-called "small group" businesses. Creating larger pools of these private sector citizens may provide them - and their employers - the ability to buy health care insurance at rates that traditionally have only been available to "big" businesses. This concept parallels the MEWA legislation passed by the Legislature for the public sector, as well as the pooling of public sector employees advocated by Cox, Senate Republicans, and Speaker Dillon.

31. Expand Availability of Health Savings Accounts for Individuals and Small Businesses To Increase Affordability and Accessibility

With the rising cost of health care, health savings accounts are a way for small businesses and individuals to provide quality health care at an affordable price. As Governor, Mike Cox will create tax incentives for businesses that provide Health Savings Accounts (HSAs) to their employees as well assist self- employed individuals in creating HSAs. Mike Cox will target incentives for those businesses that currently do not offer health insurance to their employees.

32. Pilot Health Savings Accounts for Optional Medicaid Populations To Increase Wellness and Contain Costs

Medicaid cost-growth is out of control; Medicaid spending in Michigan has grown over 88% since 2002 and now totals over $9.9 billion. One way to control the costs of Medicaid and health care for all is to provide alternative coverage for Medicaid populations that currently receive other forms of coverage. As one initial step toward healthy utilization of health care services and as a way to lower costs, Mike Cox will examine transferring a pilot group of Medicaid clients, such as 19-20 year old Medicaid recipients and Caretaker Relative populations, from traditional Medicaid coverage and provide those individuals with an affordable, high-deductible health insurance and a Health Savings Accounts.

Recipients will receive an ATM-style card attached to a pre-funded account for the amount or portion of the deductible. Medicaid administered in this way will give each recipient greater control and understanding of the value of his or her health care - and its costs. This pilot will incentivize parents to meet specific wellness benchmarks (inoculations, well baby visits, etc) for their children and allow the roll-over of "savings" from year to year. Likewise, the indigent who are chronically ill (those with diseases such as diabetes or heart problems) will similarly be incented to properly utilize health care and stay out of Emergency Rooms. (Currently, the average Medicaid recipient is four times more likely to use the ER than the average citizen). The goal is to encourage wellness and health while containing rapidly escalating Medicaid costs.


33. Expand Electronic Medical Records Utilization

Some of Michigan's hospitals now practice extensive use of electronic medical records. As a result, the use of technology provides the potential for increasing savings and efficiencies in health care. Electronic medical records and e-prescribing provide the promise of increasingly accurate diagnosis, treatment, and prescribing. Electronic medical records and prescribing also saves the consumer and health care provider time and costs. As Governor, Mike Cox will create incentives to expand the use of e-prescriptions and electronic medical records. These technological advances create savings and improve quality of care while lessening the chances of misdiagnosis, mistreatment, inaccurate prescriptions and dangerous consequences resulting from erroneous drug interactions.

34. Encourage Innovative Savings Ideas Like Tele-pharmacy For Outstate and Rural Communities

As Governor, Mike Cox will support innovative methods like tele-pharmacies to increase health care accessibility and contain costs in smaller and rural communities.

For rural areas, access to pharmacy services will be expanded by encouraging tele-pharmacy efforts. Upper Peninsula hospitals will be encouraged to work together to share pharmacist costs and hours of service.

35. Incentivize Home Health Care: Keeping People Out of the Hospital and Healing At Home

Modern advances in technology allow greater expansion of home health care due to the increased ability of health care providers to monitor patient's care by telephone and electronic medium. Caring for a patient at home can be cost-effective, reducing patient exposure to other diseases in the hospital setting, and allowing a patient to stay at home with family and friends while healing.

According to the National Association for Home Care and Hospice and Medicare data from 2007, home health care costs $132 per visit; much lower than $544 per day costs at an average nursing home; and dramatically lower than $5,765 for an overnight stay at a hospital.

NAHC also detailed results from a series of studies comparing at-home care for specific conditions versus costs in a hospital for the same conditions. Home care was the more cost-efficient option in a variety of cases ranging from a savings of $153/per patient/month for congestive heart failure care to $25,860 per patient per month for low-birth weight infant care.

36. Office of Medicaid Inspector General

Medicaid costs the State of Michigan $9.9 billion this year and is growing. National studies estimate that Medicaid fraud and waste may range from 3% to 10% in any state. As Attorney General, Mike Cox has collected a record $162 million in Medicaid fraud. Currently most of these recoveries occur as a result of "tips" as opposed to referrals from the Department of Community Health or regular audits by Community Health. Invariably, it is hard for a bureaucracy like the Department of Community Health to audit itself. As a result, very few cases are referred for investigation or prosecution. States such as New York and Texas have created an office of Medicaid inspector general to increase fraud recoveries and break the cycle of bureaucratic sluggishness in departments like the Department of Community Health.

Based upon the experience of New York and Texas, states can expect to increase Medicaid recoveries once they adopt an office of Medicaid inspector general by 400%. If Michigan were to create an inspector general, we could expect to collect at least $80 million more per year. Mike Cox will create an Office of Medicaid Inspector General to save Michigan taxpayers - and Medicaid patients - $80 million annually. By transferring existing auditors in the Department of Community Health to a Medicaid Inspector General's office, Michigan will intensify efforts and create more successful collection of fraudulent funds.


37. Reduce Health Care Cost Growth by Rewarding Quality of Care Over Quantity of Care

As Governor, Mike Cox will reduce costs in health care by finding ways to reward quality of care over quantity of care. Mike Cox will provide support for expansion of efforts like the Michigan Hospital Association Patient Safety Organization and the research being done by the Michigan Hospital Association's Keystone Center for Patient Safety and Quality - developing best practices that hospitals and providers can utilize to reduce infections and re-hospitalizations.

Mike Cox will also have the Department of Community Health partner with provider groups to provide reimbursement incentives for quality of care approaches like the Patient-Centered Medical Home.

Mike Cox will require Medicaid providers to detail efforts to follow evidence-based, best practices to receive payment from the state.

38. Explore Opportunities to Expand Access to Care by Providing Treatments by Physician Assistants and Nurses Under Supervision of a Physician

Mike Cox will explore opportunities for more primary care by Physician Assistants and Nurse Practitioners especially in rural or underserved areas. These practices enable greater access to care and lower costs. Any program implemented using treatment by physician assistants or nurse practitioners will need assistance and oversight from the Michigan State Medical Society and licensed physicians.

Paid for by Mike Cox 2010 Committee PO Box 530970 Livonia, MI 48153