Measuring Cost Across a State’s Health Care System

The measurement of cost across a state’s health care system—and setting targets for cost reduction—is a relatively new focus for states. In April, the Milbank Memorial Fund published a report on total cost of care (TCOC) measurement in four states, describing and comparing the policies in those states driving the activity, and the technical operations supporting it. As more states move to a population-based construct for health and health care, efforts to capture information on—and track and set policy limits for—total health care costs will become more prevalent.

With more states looking to contain cost growth, the Fund is extending this work into a second phase focused on further advancing knowledge and practice. The states featured in the first report—Vermont, Maryland, Massachusetts, and Oregon—will continue to make their existing TCOC measurement programs more effective and will spread adoption of successful practices.

“Capturing and tracking health care cost data is essential for a sustainable health care system,” says Rachel Block, project coordinator. “We are hoping to find out how these initiatives progress in the original study states, and translate that experience for additional states adopting models of state health care cost measurement. A major objective of this work is to build a community of leaders, an experience that will make the work of these leaders more successful.”