Right now, thanks to Rep. Eleanor Chavez, there is a very good chance that funding for what we call the “Health Cost Drivers Project” will be included in this year’s budget!
What are the Health Cost Drivers?
Health cost drivers are the systemic reasons why health care prices are spiraling. They include increasing hospital and drug expenses, our complex administrative requirements – 30% of which are related to billing and payment – and confusing IT systems that are not compatible. Cost Drivers Chart
Why it's Urgent to Address Key Health Cost Drivers
Rising health care costs impact premiums, out-of-pocket costs, employers’ ability to afford health care coverage, and state funding of needed health programs and services. These state programs include increasing the supply of physicians and other health professionals, expanding behavioral health services, and subsidizing those who cannot afford health insurance.
Health care spending will continue to rise if we stay on our current trajectory. All of us will be effected if this situation is not addressed. This includes the serious problem that state funding of much-needed programs will become unsustainable. Quotes about Rising Costs
Health Cost Drivers Project Update
Since 2021, the Superintendent of Insurance and the Legislative Health and Human Services (LHHSC) have contracted experts to explore how to address selected cost drivers with a focus on how possible solutions might play out.
Reports so far have provided vital information that serves as a springboard for designing New Mexico-appropriate policies to control health care costs. Based on these reports, next steps should include:
· Developing a global budgets program that provides financial stability for hospitals and lowers costs.
· Joining the existing Washington/Oregon drug purchasing consortium that already includes Nevada, Illinois and Connecticut.
· Tightening oversight on corporate mergers and takeovers that impact the practice of medicine and increase costs.
· Restricting prior authorization requirements that add administrative costs and interfere with care.
2023 Reports:
· NORC Administrative Costs Report
· Drug Consortium Interim Report
The legislature needs to fund Legislative Health and Human Services Committee so it can act on these reports and explore more systemic solutions to rising health care costs