The Issues


"I have known Dean both professionally, politically, and personally for years and I know that he will be a great asset to the district and will represent us well. We'll do more than well to have him representing us."

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The Problem

The cost trajectory of healthcare expenses is absolutely unsustainable.  The first chart below shows the differential in growth of healthcare premiums versus inflation and workers' earnings.  The numbers are National statistics, but similar looks at Utah also have the growth of healthcare premiums well above the rate of inflation or worker earnings.  The Federal Reforms passed will increase access to healthcare insurance, but will only exacerbate the cost problems.  Estimates have medicaid increasing by 56% after Federal Reforms are fully implemented.  Some of the increase in enrollment will be covered by Federal dollars, but those dollars will not cover all of the costs, they are not all permanent, and they are predominately debt financed.  


National Growth Trend

The Problem in Utah

In Utah even without the Federal reforms the burden of healthcare expenses from medicaid will drive the percent of state funds up from 9% to 13% in just 8 years.  This equates to hundreds of millions of dollars of unfunded liabilities for the state to absorb.  It is for these reasons many leaders in the state have rallied support around Representative's efforts to change the healthcare cost trajectory.  These groups include: The Utah Hospital Association, The Utah Medical Association, Higher Education, Health Policy Project, etc.

State Medicaid Growth

The Solution

The solution put forth by Representative Sanpei is to fundamentally change the way medicaid pays for healthcare.  In the 2011 legislative session Medicaid reform was passed (SB180) that did the following: 

•  Sets up a “road map” that will move Medicaid payments  towards population based management.

•  Will reward systems for doing the right thing versus financially “punishing” them for reducing utilization through quality improvements.

•  Moves our healthcare system towards greater individual accountability and minimized regulations on providers.

•  Requires the Health department to develop:
1) Restructuring of payments to reward “providers for delivering the most appropriate services at the lowest costs”
2) Ways to pay providers for, “…packages of services delivered over entire episodes of illness rather than for individual services delivered during each patient encounter…”

If successful in executing the road map the legislative fiscal analyst estimated a savings of $770 million over 7 years increasing further over time.  The diagram below details out how antiquated fee for service payments need to evolve into total cost accountability.  The basic premise being that as you move to the right - more service are grouped together and more cost saving opportunities are available to providers.

Contact Dean: or (801)979-5711. 

Incentive Changes

Sources:Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 1999-2010.  Bureau of Labor Statistics, Consumer Price Index, U.S. City Average of Annual Inflation (April to April), 1999-2010; Bureau of Labor Statistics, Seasonally Adjusted Data from the Current Employment Statistics Survey, 1999-2010 (April to April).