This paper provides a background overview of Pennsylvania's healthcare environment, examining the state's demographic and economic profile before turning to persistent challenges in the healthcare sector. It discusses trends in rising healthcare expenditures, declining employer-sponsored insurance coverage, the uninsured population, and the disproportionate burden of chronic illness. The paper then reviews several recent policy and technology initiatives — including the Pennsylvania eHealth Initiative (PAeHI), House Bill 2053, the Pittsburgh Regional Health Initiative, and the Pennsylvania Health Care Quality Alliance — designed to address cost containment, health information technology adoption, and quality improvement across the state.
Pennsylvania is a Mid-Atlantic state and the sixth most populous state in the Union. Its capital is Harrisburg, and its 2010 total gross state product of almost $600 billion ranked sixth in the nation. Per capita, Pennsylvania's GSP of $39,830 ranks 29th among the 50 states. The largest employers in the state are Walmart and the University of Pennsylvania. Much of the state is rural, but nearly 20 Fortune 500 companies are located in the state's urban areas.
Pennsylvania's population shows a small but positive level of growth. The state is primarily Caucasian (79.5%), followed by African American (10.8%), Latino (5.7%), Asian (2.7%), mixed race (1.9%), and Native American (0.2%). The state's unemployment rate as of July 2011 was 7.4% (Pennsylvania, 2012).
In 1986, the Commonwealth of Pennsylvania enacted legislation designed to mitigate the circumstances surrounding the healthcare crisis in the state. Costs were rising, according to the report, because of an absence of concentrated and continuous efforts across all segments of the healthcare industry to economize and curtail expenses. However, as late as 2007, the state found that trends in healthcare remained troubling for several reasons (The State of Health Care in Pennsylvania, 2007):
Growth in healthcare spending: Governmental expenditures reached almost $20 billion. Overall healthcare spending in Pennsylvania grew from $45 billion in 1995 to over $75 billion in 2005.
Employment-based health insurance: The number of insured individuals decreased while premiums increased. Declining employer-sponsored coverage, combined with the demands of the state's aging population, placed large fiscal burdens on the state.
Uninsured population: Over 2 million Pennsylvanians lacked health insurance. Hospitals absorbed over half a billion dollars in uncompensated revenue, costs that were passed on to private payers.
Chronic illness burden: Approximately 75% of healthcare costs were attributable to just 25% of patients with chronic illnesses. Lifestyle changes to reduce obesity, cigarette use, and type II diabetes were identified as priorities.
Worsening population health indicators: Some measures of population health deteriorated during this period. Obesity rates rose, and the prevalence of diabetes increased by 2%, contributing to the steep rise in healthcare spending noted above.
The Pennsylvania eHealth Initiative (PAeHI) was created in 2005 as a voluntary, public-private, and nonprofit coalition to bring together major stakeholders — including businesses, healthcare organizations, and government entities — to develop a plan for the future of health information technology at an affordable cost (Pennsylvania eHealth Initiative, 2011). The basic roles of the organization are to:
Identify opportunities for Pennsylvanians to use health information technology (HIT) and health information exchange (HIE) to improve healthcare outcomes.
Educate the public, providers, and policymakers regarding the benefits and challenges of HIT and HIE.
Coordinate the efforts of all Pennsylvania HIT stakeholders.
Identify opportunities to coordinate with and benefit from federal initiatives related to health information technology.
Develop statewide consensus on established and emerging standards, including those related to data, communication, and reporting.
Work with providers, payers, and policymakers to define viable business cases for HIT and HIE adoption across the Commonwealth. Learn more about health information technology policy from the Office of the National Coordinator for Health Information Technology.
House Bill 2053, introduced in the 2009 session of the Pennsylvania General Assembly, was known as the Freedom of Choice in Health Care Act. Its purpose was to protect the rights of individuals to purchase private health care insurance and to prohibit certain federal government actions that would restrict that right. The bill was designed to make it easier and more cost-effective for individuals or employers to pay directly for lawful health care services without penalties or taxes (House Bill 2053, 2009).
The Pittsburgh Regional Health Initiative (PRHI) is a frontline healthcare initiative that has been in place for over a decade. Its mission is to improve patient outcomes, reduce costs, and increase patient satisfaction. The initiative makes use of technology and systems-based approaches to provide excellent care at lower cost. As of the time of this report, the PRHI operated within the Pittsburgh regional area only (PRHI, 2012). More information about regional health improvement models can be found through the Agency for Healthcare Research and Quality.
The Pennsylvania Health Care Quality Alliance (PHCQA) is a nonprofit coalition of Pennsylvania healthcare providers and insurers. It was designed to improve the quality of patient health by developing a consistent, uniform, statewide approach to quality measurement that would (Pennsylvania Health Care Quality Alliance, 2012):
Enable consumers to find and access high-quality care.
Allow healthcare professionals to evaluate and improve the quality of the patient care they deliver.
"Legislation promoting private insurance purchasing freedom"
"Regional program improving outcomes and reducing costs"
"Nonprofit coalition for statewide quality measurement"
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