Golden State Today

The Office of Health Care Affordability (OHCA) recently adopted strategies to reduce health care costs and improve access to care. Established in 2022 by Governor Gavin Newsom, the OHCA aims to align prices with inflation, promote high-value care, and assess market consolidation. Under Governor Newsom's direction, the OHCA has achieved several milestones and set new goals to ensure that all Californians receive accessible, affordable, equitable, high-quality, and universal health care. These actions have garnered support from local leaders and consumers.

“It is a top priority of my administration to ensure that quality health care is available and affordable for all Californians. Increasing price and quality transparency, developing specific strategies and targets for the health care industry, and imposing financial consequences for entities that fail to meet our targets are all necessary steps to reign in health care costs. I am grateful for the work being done by the Office of Health Care Affordability and proud to see that leaders and patients across California are seeing promising results,” said Governor Gavin Newsom.

Major accomplishments include:

1. The Health Care Affordability Board approved a 3% statewide health care spending target starting at 3.5% for 2025-2026, lowering to 3.2% for 2027-2028, and reaching 3% for 2029.

2. Approval of standards to transition from traditional fee-for-service payments toward value-based models.

3. Adoption of regulations requiring reporting and review of proposed mergers within the health care system.

4. Establishment of Workforce Stability Standards to monitor the effects of spending targets on workforce stability.

Upcoming goals involve examining regional variations in health care costs in California with a public hearing in Monterey County in August 2024 in response to consumer concerns about high costs. Additionally, adopting a threshold for primary care spending is under consideration.

Individual consumers expressed their views:

“Like many Californians, I’m drowning in the high cost of living, and healthcare feels like a luxury I can barely afford," said Eric Devezin.

“When they [providers] talk about budgets … I too have a personal budget that I do what I can to make it," stated Jen Villa, Salinas High School Teacher.

“I really appreciate the progress we’ve made in California ... but there is still much more work to do," commented Sydney Pitcher.

Providers also shared their perspectives:

“What drew me to this work is that I believe in the overarching goal of increasing access to quality, affordable healthcare,” said Barry Arbuckle, President and CEO of MemorialCare.

“I am grateful ... for bringing stakeholders together ... an ambitious spending target for primary care,” remarked Kevin Grumbach, MD, Professor at UCSF Department of Family and Community Medicine.

“CMA is overarchingly supportive ... these proposed standards provide a framework based on quality," added Janice Rocco, Chief of Staff at California Medical Association.