HHS Secretary Leavitt Urges State Medicaid Directors To Join With Federal Government, Big Businesses To Increase Purchasing Clout, Reduce Health Care

November 20, 2006 – 10:34 pm | posted in Medicare, Public Health

State Medicaid programs should join federal programs and large businesses in creating their health care contracts to increase purchasing clout and improve health care quality, HHS Secretary Mike Leavitt said at a National Association of State Medicaid Directors meeting on Wednesday, CQ HealthBeat reports (Reichard, CQ HealthBeat, 11/15). In August, President Bush signed an executive order that requires HHS, the Department of Defense, the Department of Veterans Affairs and the Office of Personnel Management to collect more information about the quality and cost of health care they provide and to share that data with one another and with beneficiaries by Jan. 1, 2007 (Kaiser Daily Health Policy Report, 8/23). State Medicaid programs were exempt from the order, but Leavitt urged the directors to base their contracting process — which begins next spring on health care purchased in 2008 — on “four cornerstones” that build on the order:

Interoperable health information technology systems;
Common measures of care quality;
Pricing information for individual medical procedures that allow costs to be compared on an “apples-to-apples” basis; and
Financial incentives for providers to give higher quality care and for consumers to choose care that offers the best “value” at a lower cost.

Leavitt told Medicaid officials that the “four cornerstones will be prominent parts” of 2008 contracts across the public and private sectors, adding, “There have been [requests for proposals] developed that begin to lay out a toolkit of ways in which, when we do procurements on our health care for next year, we include those four things. We would be … asking you to join us to begin moving health care for a sector to a system.” Leavitt also sought the participation of state governors. It is “unclear” how many Medicaid directors will follow Leavitt’s request, as they already are “grappling with a variety of new federal requirements,” according to CQ HealthBeat (CQ HealthBeat, 11/15).

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