Governor Ned Lamont has announced that Connecticut will receive $12 million from the Centers for Medicare & Medicaid Services (CMS) to help reduce healthcare costs across the state. The federal funds will be used to expand primary care services, support community health programs, and overhaul payment models. The goal is to increase primary care spending to 10% of total healthcare spending by 2025, but current statewide primary care spending is only at 4.9%, falling short of the target of 5.3%.
The new Total Cost of Care model will hold states accountable for health outcomes and quality, with the aim of reducing healthcare costs across Medicare, Medicaid, and private insurance. However, the Connecticut Hospital Association has raised concerns about this approach, questioning how it can succeed if budgets are based on Medicare and Medicaid payment rates that do not cover the cost of care. According to the Office of Health Strategy, residents with employer-sponsored health coverage in Connecticut have seen a significant increase in premiums over the last two decades, along with a higher share of total healthcare costs paid out of pocket.
To meet its target benchmarks for primary care investments, chronic disease management, health equity, and cost containment, Connecticut will participate in the States Advancing All-Payer Health Equity Approaches and Development Model (AHEAD). This involvement of partners such as the state Medicaid agency, Medicare, commercial payers, hospitals, and primary care providers will be crucial for the success of the initiatives launched through the model. Hospital participation in the program is voluntary, with Vermont and Maryland also being selected to participate in the program through an application process.