Legislation establishes all-payer database

By Jimy Valenti
THE COLORADO STATESMAN

A bill that lawmakers say will improve health care quality while lowering costs unanimously passed the House Health Committee last Thursday.

House Bill 1330, sponsored by, Reps. John Kefalas, D-Fort Collins, Daniel Kagan, D-Englewood, and Sen. John Morse, D-Colorado Springs, would establish an all-payer database. It would be available to doctors, insurance companies, and consumers in an effort to improve health care quality, increase transparency and give lawmakers insight on to how health care dollars are spent.

“We know information to compare quality, costs and efficiencies is limited for consumers and health care providers,” said Kefalas. “Our goal over the next five years is to lower the cost of health insurance to the rate of inflation and to improve provider outcomes.”

Phil Kalin, executive director for the Center for Improving Value in Health Care, said that five million Coloradans spend $30 billion annually on health care. Costs in Colorado are rising five times faster than inflation, according to Kalin.

“You can’t manage what you can’t measure,” said Kalin.

Lawmakers said creating an all-payer database will drive down health care costs by creating transparency in the market. Consumers would be able to see prices on everything from a colonoscopy to various insurance plans, thus creating more competition.

“The marketplace for health care is a complex, crowded bustling marketplace operating in almost total darkness,” said Kagan. “We don’t know what we bought, or what we paid. The sellers don’t know who their customers are. This is the way we run the health care marketplace.”

Dr. Jay Want, CEO, Physician Health Partners, also said an all-payer database will save providers money by allowing doctors to compare treatments of similar patients across the state.

“The all-payer database allows us to not just look at 10 of my diabetic patients, but all 200 of them,” said Want. “With this database we can really determine if I am doing a better job or worse job than the guy down the road.”

Want said that after doctors compare their own practices to those of other doctors they can avoid tests and treatments that may not be necessary. Kefalas added that overutilization is one of the biggest drivers in health care costs.

Want said the bill would also increase health care quality. Currently, Want said that doctors may receive a letter from insurance providers telling them they will be on the plan’s preferred network, due to excellent service. The next day that same doctor may get a letter from a different insurance provider telling them they are in that plan’s non-preferred network, due to poor performance.

Want said neither insurance plan is correct in assessing doctors because proper data does not currently exist. An all-payer database will increase quality because doctors and their patients would know how they compare with each other.

“Doctors at the bottom of this list will inevitably look to the top of the list for direction,” said Want. “This database is the first step in creating the kind of accountability and transparency the system needs.”

Linda Gorman, the health care policy center director for the Independence Institute, said the all-payer database is a Trojan horse for the state to enact further control over the health care industry.

Gorman said the database is a frightening invasion of privacy. She said private health records could be compromised no matter how well they are protected. Gorman also said health care quality will not improve if doctors compare results on a statewide database.

“Health care is practiced on an individualized level,” said Gorman. “If there was some magic formula out there software could diagnose and treat people with the same information that would be in this database.”

Kefalas acknowledged the database’s privacy concerns. He said not all users will be able to see all data and that any identifying information would be invisible from the start to all users. The bill sets up an advisory committee that will work out these details.

Amy Oliver Cooke, director of the Colorado Transparency Project, also expressed concern for the bill.

“Transparency means taxpayers get to see inside government, not the other way around,” Cooke said in a statement. “Lawmakers are trying to hijack transparency to expand the scope of state government. It’s very Orwellian.”

Lawmakers said the bill would provide needed information to everyone involved in the health care industry.

“Information has a powerful influence over human behavior, but it has to be plentiful, it has to be accurate and it has to be timely,” said Morse. “That’s what this bill does.”

Jimy@coloradostatesman.com