Originally created 12/12/04

State seeks lower health costs



ATLANTA - After listening to health-care professionals, advocates and others discuss growing medical costs and what Georgia might do to limit them, Newnan retiree Dave Harris had trouble picking out the most intriguing idea.

"Everything, practically," Mr. Harris said after the Wednesday morning meeting at the state Capitol. "They all had good ideas."

And all of those ideas, observers and lawmakers say, might be needed to help rein in the ever-rising cost of health care, both for private plans and for those funded by taxpayers.

For several years, ballooning medical prices have stretched the wallets of working families and the state budget. Medicaid, a state and federal program that provides health care for lower-income Georgians, is expected to gobble up 60 percent of the state's new revenue next year, crowding out other priorities.

"We've got schools and public safety and infrastructure needs we've got to be able to fund as well," said Rep. Ben Harbin, R-Evans, a member of the House Appropriations Committee.

But lawmakers and experts in health care quickly acknowledge there is no silver bullet that will fix the rapid inflation in medical costs. The solution is likely to be a complex web of initiatives and might take several years to put in place.

Discussions about the rising costs of health care - and its impact on the budgets of families and states - have grown in recent years as prices have risen. In addition to Wednesday's summit, a portion of a meeting of legislators this week in Athens will be devoted to the issue.

And the topic was a subject of a meeting last week at the National Conference of State Legislators held in Savannah.

"It's the biggest issue we're going to face," Mr. Harbin said of the coming legislative session that begins in January.

Even legislators are willing to admit they have no cure-all for the problem.

"It's just one of those things where there's just no easy answers," said Rep. Mickey Channell, D-Greensboro.

But observers say the state does have the ability to wrestle with the problem and possibly subdue rising costs.

"I think in a lot of cases, they have more power than they realize," said James Frogue, the director of the health and human services task force for American Legislative Exchange Council. " ... Most of the health-care regulation takes place at the state level."

Sen. Mitch Seabaugh, the Sharpsburg Republican who organized the Wednesday meeting, said the General Assembly would have to be content taking "pot shots" at the problem in the short term while looking for long-term solutions. He suggests putting together a blue-ribbon commission to recommend a comprehensive health-care policy.

Mr. Harbin agreed that a mix of solutions would be needed to tackle the problem.

"It's going to take a lot of little things," he said. " ... It'll take time. It'll take people being willing to think differently than the way we're doing things today."

SEVERAL LAWMAKERS are looking to proposed restrictions on medical-malpractice lawsuits to help cut or at least slow the growth of health-care costs. Mr. Frogue said the possibility of malpractice lawsuits often drives doctors to pursue unnecessary tests or other forms of "defensive medicine" to make sure they can't be attacked at a trial for not performing the tests.

But a fierce debate surrounds how much could actually be saved by cutting back on malpractice lawsuits. Mr. Webb said Wednesday that only 0.5 percent to 2 percent of all health-care costs could be traced back to jury awards. But Mr. Seabaugh countered that those costs didn't take into account settlements reached before a case goes to trial.

"What they're talking about is a case that goes to trial all the way to verdict," he said.

But GeorgiaWatch, an advocacy group that opposes some restrictions on medical lawsuits, says some of the measures will do little to contain health-care prices. They particularly question whether a cap on medical-malpractice awards would slice medical costs at all, pointing to studies by the nonpartisan Congressional Budget Office.

"Thus, even a reduction of 25 percent to 30 percent in malpractice costs would lower health care costs by only about 0.4 percent to 0.5 percent, and the likely effect on health insurance premiums would be comparably small," the nonpartisan office reported in January.

Allie Wall, the executive director of GeorgiaWatch, said there is scant research on what sort of savings might be produced by lawsuit restrictions.

"Medical-malpractice costs are not as big of a deal as people would have you believe," she said, noting that the proposals would limit action by malpractice victims. "Doesn't sound like a good deal to me."

Also on the table are "consumer-driven" health-care plans. Those proposals would allow for the creation of health savings accounts that would cover a portion of a patient's medical bills.

The plan would make consumers more aware of how much they were spending on visits to the doctor's office and other medical expenses and would tap health-care plans only when costs became large, supporters say.

"You have an incentive to spend your health-care dollars wisely," said Kelly McCutchen, the executive vice president of the Georgia Public Policy Foundation.

Federal tax breaks already exist for health savings accounts, and states can bolster the plans by matching those incentives, Mr. Frogue said.

Some are cautious about large changes to the way the state pays for health care, Mr. Harbin said, but the alternative to making those changes is even worse.

"If we don't, the changes we make down the road will be so drastic that nobody will win," he said.

Reach Brandon Larrabee at (404) 681-1701 or brandon.larrabee@morris.com.