Peter Goldmark writes a weekly column for Newsday. He is former budget director of New York State and Show More
When the big, expensive restaurant on the corner is closed for repairs, smaller, leaner, mom-and-pop takeouts spring up around the neighborhood.
That's what's happening with innovation in government. The federal government is paralyzed by partisan rancor. The months roll by and nothing serious happens in our national government -- except sequesters, debt-ceiling fights and high-decibel deadlock.
So to see governments doing something practical to deal with problems, you have to look at the state and local level.
New York enacted a very strong gun control law early this year, following the slaughter in Newtown, Conn. More surprisingly, in Colorado, the lower house of the legislature has passed a strong gun control bill and the state Senate plans to take it up this month.
A handful of states from Maine to Hawaii have been debating whether to establish state banks to help finance infrastructure and economic development projects. North Dakota has had a state bank with that mandate for years.
An even more daring innovation is being explored in locations as varied as the city of Indianapolis and the state of Utah. The vehicle transportation fleet in this country is handcuffed by near-total dependence on traditional gasoline, whose cost keeps going up, and half of which is imported from governments overseas -- not all of whom wish us well. While the federal government has been moving slowly -- with a timetable that doesn't make any real changes in efficiency for a decade or more -- some local and state governments are asking if they can't do more faster. They're beginning to explore how to get their own fleets off conventional gasoline, with its high prices and large carbon footprint, and seeking to allow gas stations to offer cheaper, cleaner alternative fuels to the public this decade -- everything from methanol to natural gas to charging ports for electric batteries.
But by far the boldest and most financially consequential area of state innovation is in the area of health expenditures -- namely Medicaid. And one of the states doing the most to reconfigure its health expenditures and services is New York.
When Gov. Andrew M. Cuomo took office, he established a task force that introduced several innovations that work in combination. The first was setting an annual cap of 4 percent on the overall increase in state Medicaid expenditures. The second was working together closely with the hospitals, rather than bombarding them with a barrage of new regulations designed in Albany. And the third was requiring an integrated health care plan for the quarter of Medicaid patients who account for three-quarters of total Medicaid expenditures -- rather than having them rack up often repetitive charges in each of the silos of specialized care that can respond to only one specific aspect of their needs. All this was put in place over the past two years, and it's making a difference.
Here's a concrete example: Someone with behavioral health problems such as substance abuse might, in an extreme example, be admitted as often as five times a year to a detox center -- but with no aftercare, no follow-up. Through the requirement that an overall care plan be prepared and followed, that patient now gets better service, and costs us all a lot less money.
What would the state's annual increase in Medicaid costs have been without these innovations? A senior health systems executive in Albany estimates it would have been around the double-digit mark. When you're dealing with a program as big as Medicaid, the difference between a 4 percent annual cap and a 9 to 10 percent increase means billions of dollars.
In this and so many other areas, maybe those in Washington yelling at each other about spiraling health care costs should pause and take a look at the practical measures the states have quietly been implementing, while members of Congress posture ideologically on the national stage.