PROVIDER RATE REGULATION

Healthcare costs in the United States are significantly greater than in other countries because we pay higher prices for the healthcare services we receive, not because we use more services or have higher quality care. A primary reason for these high prices is the consolidation of healthcare providers, especially hospitals, into large regional and national health systems. While The Source offers policymakers a range of administrative and litigation tools to better oversee future market consolidation, in many markets, existing competition remains insufficient to constrain the pricing power of dominant insurers and providers. In these markets, policymakers need to consider options to directly limit the unrelenting increase of healthcare prices that threatens the affordability of health care for Americans. With support from Arnold Ventures, this project aims to provide policymakers with unbiased, evidence-based, policy-relevant information on the most effective strategies for states to address rapidly increasing prices.

We identified a spectrum of seven options for states to place pressure on or directly control healthcare prices. Navigate the left side menu for details and resources on each of the policy options. On this Overview page, click on the buttons below for a comparison of these options, including a roadmap for state implementation, a map of states that have implemented one or more of the options, and a comparison of the options by level of impact based on state experiences.

Starting with cost-growth benchmarks, the options increase in the level of regulatory intervention and in the amount of control on overall expenditures. State policymakers can choose and tailor any of these options to meet the market conditions and political climate in their state.