“This Washington” saves money on Medicaid costs

Arthroscopic knee surgery: one of the treatments limited in Washington state's Health Technology Assessment program.
Arthroscopic knee surgery: one of the treatments limited in Washington state’s Health Technology Assessment program. Shutterstock

In an interesting article on the “Center for Public Integrity” website Washington State is called out as having a cost-effective way to make decisions about what medical treatments don’t actually work, and to stop paying for them. This is not without controversy, as you might expect.

In order to cut costs and put Medicare on a stronger footing, many health policy experts say the program must stop covering procedures that do little to improve patient health or are not worth the price tag. But the Centers for Medicare and Medicaid Services (CMS), the agency that administers the program, has for the most part failed to implement such cost-cutting measures, because its authority is limited, cuts are controversial and Congress frequently interferes.

Washington state, however, is making the tough choices. In 2006, the legislature in the Evergreen State established its Health Technology Assessment, a program that evaluates medical procedures and devices paid for by state public employee insurance, worker’s compensation and Medicaid, the joint federal-state insurance program for low-income individuals and families. The assessment program is run by a state-appointed committee of 11 practicing doctors, nurses and health professionals. It’s charged with ensuring covered medical care is safe, effective and worth the cost. Its decisions are binding.

Since the program’s inception, the committee has cut coverage for 21 medical procedures and devices and set strict conditions for covering others, many of which Medicare continues to pay for. The procedures include popular and expensive treatments like arthroscopic knee surgery, back pain injections, CT heart scans, and lumbar fusion. By state estimates, the committee has saved Washington more than $40 million a year. If Medicare had followed Washington state’s lead and cut funding for the same procedures, experts say it would have saved billions.

It’s nice to see some coverage of the work we put in trying to keep medical cost inflation in Medicaid under control. We’ve been able to keep overall cost growth in the program growing at less than 4.5% a year for the last decade or so, and that includes growth in the caseload, which has been at least half of the growth.

Making this kind of hard decision allows us to cover a higher percentage of low-income children than we might otherwise be able to , or spend more money on higher education.

Author: Ross

I am the Director of the Department of Early Learning for Washington State. I formerly represented the 48th Legislative District in the State House of Representatives, chairing the Appropriations committee and spent many a year at Microsoft.