Borrowing a Republican idea, a group including former senior Obama and Clinton advisers is unveiling a novel proposal to let states take the lead in controlling health costs.
Individual states would set their own targets to curb the growth of health care spending. If they succeed, they’d pocket a share of federal Medicare and Medicaid savings, ranging from tens of millions to $1 billion or more, depending on the state.
The plan, released Thursday, comes from the Center for American Progress, a public policy think tank closely associated with the White House.
The center’s former president, John Podesta, currently serves as counselor to President Obama.
Called “Accountable Care States,” the new option would be voluntary, reflecting longstanding Republican preferences.
To address Democratic concerns, participating states would have to maintain insurance coverage levels and enforce consumer quality standards to claim their financial dividends.
The state spending targets would encompass private spending, as well as Medicare, Medicaid, state and local employee insurance plans, and subsidized private coverage under the new health law. States would not have to expand Medicaid under Obama’s health care overhaul to participate.
Release of the plan follows a government report earlier this week that projects a return to unsustainable levels of health care inflation.
Spending has been held in check the past five years largely because of a weak economy.