With health care costs continuing to rise, states like North Carolina are testing innovative approaches for managing costs under constrained budgets.

Some states have passed laws that allow regulators more oversight to lower drug prices. Others now require greater transparency from providers, payers or manufacturers. However, North Carolina is in the midst of trying a more systemic approach: public and commercial health industry leaders in the state are working together to move the majority of the state’s prepaid health plans to value-based payment models within the next two years.

That initiative was detailed during a panel at a Sept. 11 event, “Health Spending: Moving From Theory To Action,” sponsored by Health Affairs, the National Pharmaceutical Council and several Going Below The Surface forum partners. The panel featured Mandy Cohen, MD, MPH, who oversees state spending as the leader of the North Carolina Department of Health and Human Services, and Patrick Conway, MD, the president and CEO of the state’s commercial Blue Cross and Blue Shield insurer.

This isn’t the first time the two have collaborated on innovative health care programs; they previously worked together in top positions at the Centers for Medicare and Medicaid Services. In North Carolina, they are building on their joint experience at the federal level to deliver population health results for the state, looking beyond just quality metrics and measurement to drive real outcomes. “I don’t want box checking,” Cohen said. “I want health.”

Though Cohen and Conway are dealing with health spending issues through fundamentally different lenses, both acknowledged that they have a similar recipe for success. This includes shifting toward models that pay for value, rather than fee-for-service; tracking clinical data for measures of success; and learning from past mistakes and other states’ experiences, such as MassHealth’s Patient-Centered Primary Care Collaborative.

With investments from the federal and state governments, as well as Blue Cross and Blue Shield of North Carolina, health care leaders are making better use of data analysis to identify the types of interventions that will improve the health of each patient in the state’s system. Conway also underscored the importance of investments in the “drivers of health care,” such as food security and behavioral health, as a key area of alignment between the two leaders.

For state-sponsored health programs, this includes the launch of NCCARE360, the first statewide coordinated care network to electronically connect people with identified needs to community resources. The platform is integrated from beginning to end, following up across all coordinating services to share information and track outcomes. “If we want to use our money to buy health,” Cohen said, “we need to connect our health care system to what’s going on in our community and social support.”

North Carolina is a part of an increasingly interconnected group of states pushing ahead with novel approaches to health spending, and fellow panelist Chris Koller from Milbank Memorial Fund shared how states such as Massachusetts, Maryland and Vermont are considering different methods such as budgeting caps to tackle health spending.

Multi-stakeholder initiatives, including North Carolina’s strategy, address the root of health care spending issues in the U.S. Highlighting examples like these are why the National Pharmaceutical Council founded Going Below The Surface, a research-first initiative designed to help unearth and examine the drivers of health care spending and convene a multiple-stakeholder discussion to better understand what we receive for these investments. To stay up to date on the evolving health spending conversation, be sure to sign up for our newsletter and follow the #GoingBelowTheSurface hashtag on Twitter.