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What’s happening: Yesterday, the Office of Health Care Affordability (OHCA) released its final recommendation of a 3% spending growth target for 2025-29.
What else to know: CHA submitted comments on this proposal Jan. 18. As CHA continues to advocate for an attainable, sustainable target, members’ support will be crucial in demonstrating the detrimental impact a 3% spending target would have on patient care.
OHCA is tasked with slowing the growth of health care spending, principally by setting and enforcing a target for the annual growth in per capita total health care expenditures.
In December, OHCA staff released a preliminary recommendation for a first statewide health care spending target of 3% for the years 2025-29. Yesterday, OHCA staff finalized its recommended target, proposing an identical value and multiyear term for the spending target. The methodology is similar to the one proposed in December, with the target exclusively based on the historical growth in median household income over the past 20 years.
Formal adoption of the spending target requires approval from OHCA’s governing board. OHCA will take the following steps to finalize the target:
- Next week, the OHCA advisory committee (Jan. 23) and board (Jan. 24) will meet to discuss the proposed target.
- The Jan. 24 OHCA board meeting initiates a 45-day public comment period, which closes on March 11 at 5 p.m.
- The OHCA board may then take action to approve the spending target. Unless the schedule changes, this could occur at any of the March 27, April 24, or May 22 board meetings.
Unfortunately, OHCA staff’s proposed target misses the mark. Over the next months, CHA will step up its engagement with OHCA, its board, and other state policymakers to advocate for a spending target that is attainable, sustainable, and supportive of efforts by hospitals and other providers to improve equitable access to high-quality care. To obtain a more reasonable spending target, CHA will need the help of our members, as well as other impacted providers, to tell their stories of what a 3% spending target would mean for the essential care they provide in their communities.
For more information, contact Ben Johnson, vice president, policy, at bjohnson@calhospital.org.
