In response to questions, we’ve published two new documents
about the most controversial part of the Health Care Cabinet’s Strawman
proposal for health reform in Connecticut. To help in understanding how
downside risk might work, and whether it works, in the context of other
options, we’ve developed a fairly short Downside
Risk Explainer. To address points offered by downside risk proponents,
we’ve also drafted a somewhat longer
response to the proposal. The response answers the proponents’ arguments
with Connecticut-specific context, and outlines concerns of advocates and
others including the administration’s promise not to impose downside risk on
Medicaid, that downside risk is experimental and very new, it is very unpopular
among providers, potentially reducing our hard-won increases in Medicaid
participation rates, the proponents’ economic theory suggests that downside
risk will reduce investment in innovation, and the model creates very strong
incentives to deny necessary, appropriate care but includes no monitoring
system or policies to prevent it. In many respects, downside risk combines the
worst features of shared savings with capitation, which was a “spectacular
failure” in Connecticut. The response also includes better alternatives to
achieve the goals of improving quality and controlling costs without the risks
of downside risk.
