Earlier this month, the Minnesota Department of Health released the first annual report examining changes in health care spending, as directed by 2008 health care reform legislation. The report demonstrates that in 2008, dollars spent by Minnesotans on health care—both public and private, but excluding Medicare and long-term care—were on the rise at a pace greater than the rest of the nation.

First, the good news: Minnesota health care spending remains below the nation’s average of $7,166 per person, coming in at $6,720.  Despite the lower spending, Minnesota maintained its 1^st-place rank in health outcomes, as determined by the National Health Rankings. This lower spending adds credence to the notion that higher costs don’t necessarily produce better health outcomes; healthy lifestyles and an emphasis on prevention and wellness typically cost less, and produce better results.

Now, the bad news: Despite maintaining an overall lower cost, Minnesota’s health care spending represented a 5.7% increase over 2007, while the nation as a whole saw spending grow by only 4.4% over the previous year. And this echoes the 2006-2007 growth rate as well, when spending grew 7.1% in Minnesota but only 6% nationwide. (Experts attribute the declining growth rates from 2007 to 2008 to the recession.)

Yet even as our health care spending outpaces the nation’s, in determinants of future health outcomes, Minnesota has sunk in the overall National Health Rankings to 7^th. As our spending rose disproportionately, our projected health outcomes actually got worse. A disproportionate increase in money spent might be acceptable if it meant added value, but the numbers don’t bear that out.

These numbers serve as another reminder that our current health system does not reward healthy outcomes, but rather volume of procedures. As Minnesota 2020 has detailed before, the new federal health care bill offers some incentives to base health care dollars on outcomes and performance rather than on volume. Mayo Clinic advocates such a model, and hopes such incentives will be expanded through future federal legislation. Such a shift could remind Minnesota health care providers of what they need to focus on and help the state get back on track so we can maintain our spot as #1 in health outcomes.  It is a focus on where we could end up and where we want to be, rather than on where we are now, that will keep Minnesota on top.

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Tags: Health Care, health care costs, Minnesota Department of Health, National Health Rankings

This entry was posted on Thursday, June 10th, 2010 at 3:52 pm and is filed under Health Care, Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.