Health Reform Initiative Launched in Pennsylvania

Sustainable Health Care Costs

By Rachel Block

In an effort to improve the affordability of high-quality health care and address health disparities exacerbated by the COVID-19 pandemic, Pennsylvania Governor Tom Wolf released an executive order on October 3. The “Whole-Person Reform” package includes three key components that together aim to make Pennsylvania’s health system more efficient while better meeting residents’ physical, behavioral, and social needs.

First, it calls for the formation of an Interagency Health Reform Council made up of key state agencies involved in health care issues. The council’s preliminary goal will be to propose strategies to promote efficiencies in Pennsylvania’s health care system by facilitating increased collaboration across health care stakeholders.

Second, the governor will work with the legislature to pass legislation and establish a new Health Value Commission. This independent commission would be charged with “keeping all payors and providers accountable for health care cost growth, to provide the long-term affordability and sustainability of our health care system, and to promote whole-person care.” Three specific duties for the commission include:

  • Development of a health care cost growth benchmark to foster statewide accountability and contain health care costs.
  • Development of spending targets to increase investment in primary care, behavioral health, and value-based purchasing to support whole-person health care.
  • Performing public interest reviews of large provider mergers, acquisitions, and changes in ownership, to ensure transparency for Pennsylvania consumers, businesses, and communities.

Third, the governor announced the formation of Regional Accountable Health Councils through Medicaid that will be tasked with facilitating collaboration among payers, providers, and community-based organizations to address social determinants of health and health disparities.

“Correcting the health disparities in Pennsylvania communities requires an effort that is bigger than any one payer, provider, or even state agency,” said Dr. Douglas Jacobs, the Chief Innovation Officer of the Pennsylvania Department of Human Services and one of the leaders of this effort. “Small pilot programs do not address the magnitude of health inequities that exist on a block-by-block level. Alignment among payers, providers, and community-based organizations, is critical.”

The roadmap laid out in Governor Wolf’s announcement aligns with the Peterson-Milbank Sustainable Health Care Costs Program, and mirrors activities undertaken by other states such as Oregon, Washington, and Connecticut to achieve broader health system transformation.