State rate -setting in conjunction with Medicare prospective payment: The effects of the Maine program

Maine implemented a hospital rate-setting program in 1984 at approximately the same time as Medicare started the Prospective Payment System (PPS). This study examines the effectiveness of the program in controlling cost over the period 1984-1989. Hospital costs in Maine are compared to costs in 36 non rate-setting states and 11 other rate-setting states. Changes in cost per equivalent admission, adjusted patient day, per capita, admissions, and length of stay are described and analyzed using multivariate techniques. A number of supply and demand variables which were expected to influence costs independently of rate-setting were controlled for in the study. Results indicate the program was effective in containing costs measured in terms of cost per adjusted patient day. However, this was not true for the other two cost variables. The average length of stay increased during the period in Maine hospitals indicating an association with rate-setting. Several supply variables, especially the number of beds per 1,000 population were strongly associated with the cost and use of hospitals. ^

State health care reform: An analysis of strategies

The United States health care system faces significant challenges, particularly with problems of the uninsured and with the rising costs of care. These problems lead many to study and discuss strategies for reforming the health care system. Four different plans for ideal health care reform, set forth by notable scholars or organizations, are explained herein. Then, states within the United States are examined in terms of their recent efforts at health care reform. Those states proposing significant changes to their health care systems are analyzed—namely, Maine, Massachusetts, and Vermont. The strategies used in these three states are compared to the strategies laid out by the experts in order to determine which strategies are the most popular in current health care reform efforts among the states studied here. These strategies are totaled to find which organization's plan for ideal reform seems to be the most popular. The strategies of managed competition are shown to be the most popular strategies among these three state health care reforms, while the strategies of the single-payer plan discussed herein were the least popular. All three states seem to utilize strategies that build upon their previous health care system, rather than implementing strategies that completely replace the previous system. ^