The 2017 state ballots that could reshape health care delivery

Topics: Elections, 2016, Health Care Reform, Costs and Prices, Prescription Drugs

By: Sam Bernstein, senior staff writer

While the debate over health care in the presidential race has generated lots of coverage, there are several high-stakes health care issues that will be on the ballot this November in the states, too.

According to Ballotpedia, five health care-related measures are slated to appear on the November ballot in four states: California, Colorado, Nevada, and Washington. The measures range from the price of prescription drugs to the creation of a single-payer health care system.

Controlling prescription drug costs

In California, the biggest health care-related question on the ballot will be Proposition 61, which would prevent drug companies from charging state health care programs more than the negotiated price paid by Veterans Affairs (VA). The proposal would allow certain exceptions, such as for private insurers that contract with Medi-Cal, the state's Medicaid program.

 

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Advocates say Proposition 61 would cut the cost of prescription drugs, and the measure is "being closely watched as a litmus test for public discontent over prescription drug costs," Ed Silverman writes for STAT News.

But the state Legislative Analyst's Office in a report said the measure's fiscal impact is not entirely clear, and opponents of the initiative say it actually could increase the cost of drugs because drugmakers may increase the price they charge VA.

The California Medical Association (CMA) also opposes the proposal. CMA President Steven Larson in a statement said, "Of greatest concern to doctors is that the measure would result in a new bureaucratic prior approval process that could interfere with patient access to the medicines they need."

The proposal also is opposed by the pharmaceutical industry, which has raised millions of dollars to fight it.

Other groups in opposition include the California Chamber of Commerce, the California NAACP, and some veterans' groups.

However, a recent poll of Californians conducted by supporters of the measure found that about two-thirds of state voters support its passage.

A single-payer push

Meanwhile, Colorado residents will vote on whether to convert the state's health care system to a single-payer model. Under Amendment 69, the state would create ColoradoCare, a government-financed payer that would eliminate the state's ACA exchanges and replace most private insurance.

 

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ColoradoCare coverage would have no deductibles and no copayments for certain primary care and preventive services, and patients would be able to choose their doctors.

A 21-member board would oversee the system, which would be financed through a combination of new state taxes and redirected federal funding that currently goes toward ACA insurance subsidies and Medicaid. The state would need to submit a waiver under the ACA to implement the program, which would be subject to federal approval. If the initiative is successful, Colorado could become the first state to opt out of the ACA by implementing statewide universal health coverage.

Proponents of the measure say it would cut health care costs by eliminating insurance company profits and reducing overhead expenses. But an analysis by the independent Colorado Health Institute (CHI) paints a worrying fiscal picture, estimating that the program would reduce health spending in its first decade but then run progressively larger deficits in later years as health care costs rise. 

However, another analysis produced by the Colorado Foundation for Universal Health Care found that the system would run a $1.5 billion surplus in its first year. Anders Fremstad, an economist who has consulted for the ColoradoCare campaign told the Denver Post that CHI's analysis had several shortcomings, including that it assumes the federal government will reduce Medicaid payments.

Ivan Miller, the executive director of the pro-ColoradoCare campaign, in a statement said, "If CHI had considered increased savings over time and the full Medicaid waiver, it would have found that our model is viable and sustainable."

The Colorado Hospital Association (CHA) earlier this year released an opposition paper that argues the proposal "threaten[s] the sustainability of Colorado hospitals and health systems." CHA said the state-run system would reimburse providers less than private insurers and that its members already lose money caring for Medicaid beneficiaries due to low reimbursement rates.

"Without private insurance—and in a single public payer model used by ColoradoCare—hospital underpayment is likely to spread," CHA warned. The organization also expressed concern that a single-payer system would encourage high utilization by patients, driving up health costs.

Looking ahead

If approved, these state ballot measures could prompt similar action in other states. Advocates in Ohio are already pushing their own measure to control prescription drug costs. However, the proposal likely won't reach the ballot until 2017.

Colorado's measure, even with state residents' support, would still be subject to federal approval. Colorado would be able to submit a waiver to use federal funding intended for the ACA to redesign their its health care system under Section 1332 of the ACA, which is set to take effect in 2017. However, a recent Government Accountability Office report found that the government's waiver requirements could pose an obstacle for most states. For instance, the federal government said it would not approve any redesign plans that reduce the number of insured individuals and that such plans would need to be deficit neutral.