As Californians face an affordability crisis on many fronts, the cost of health care has been rising above inflation for years, taking larger and larger chunks out of workers’ wages and family finances. To address the rising cost of care the Legislature passed and Governor Newsom signed the 2022-23 state budget which created the Office of Health Care Affordability, within the Department of Health Care Access and Information (HCAI).
This new Office will be charged with increasing price and quality transparency, developing specific strategies and cost targets for the different sectors of the health care industry, and will impose financial consequences for entities that fail to meet these targets. The ultimate goal is to have these savings be returned to consumers who are directly impacted by increasing health care costs. This new Office will put in place a comprehensive strategy to contain health care costs, setting targets for affordability with accountability, and drive innovation in payment and delivery of care.
Given the size and scale of the issue, as well as the solutions the Office could provide, the proposal garnered the support of a broad range of organizations, including consumer, labor, business, health providers, and health care plans committed to working together to meet the goals of this newly established Office.