Catamount Health, the state-subsidized health care program for uninsured Vermonters, which was slated for elimination under Gov. Peter Shumlin’s budget proposal, may survive after all.
Hospitals and doctors have joined forces to fight the Vermont Health Access Plan-Catamount Health Plan merger, which was designed to save about $16 million gross in Medicaid and state funds. The savings were to come from cuts to health care providers, especially doctors, and a $700 hike in deductibles for patients.
About 12,000 Vermonters are enrolled in Catamount. More than 150,000 are part of VHAP.
On Tuesday morning, Steve Kimbell, commissioner of the Department of Banking, Insurance, Securities and Health Care Administration, resuscitated Catamount’s lifeless form at a meeting with the House Appropriations Committee.
Kimbell presented a proposal, based on a letter from Kevin Goddard, vice president of communications for BlueCross BlueShield of Vermont, to the budget-writing committee that would keep the program alive and save $4 million to $5 million in Medicaid and state money. Of that amount, the state would save about $1.6 million in General Fund money, according to the Joint Fiscal Office.
Missing from the equation? About $11 million in total savings, including Medicaid and state funds.
“That $11 million has to be found someplace in order for the administration to be supportive,” Kimbell said in an interview.
Just where $11 million would be made up in the fiscal 2012 budget bill, which includes a $173 million revenue shortfall, is anyone’s guess at this point. The House Appropriations Committee is marking up the budget bill this week after taking three weeks of testimony on Shumlin’s proposals for resolving the budget gap. The bill is supposed to be finished on Friday; the committee is expected to vote on the proposal on Monday. At a noontime Democratic Caucus meeting on Tuesday, Rep. Martha Heath, D-Westfield, chair of House Appropriations, said the committee wasn’t in a position to report out details of potential changes to the governor’s budget.
By midday on Tuesday, word spread about the Catamount proposal. Rep. Mitzi Johnson, D-Grand Isle, vice chair of House Appropriations, paid a visit to the House Health Care Committee to explain the Catamount “haircut.”
Under the plan, the insurers that administer Catamount — MVP and BlueCross BlueShield of Vermont — would take a 15 percent reduction in administrative fees, for a savings of about $1.1 million. Reimbursement rates for doctors would be reduced by 1 percent, for a savings of about $900,000. Hospital reimbursements would be reduced by $2 million.
“This doesn’t save as much money as the initial merger does,” Johnson said. “But the initial proposal balances the budget on the backs of providers. This proposal keeps our promises under the original Catamount plan and still saves (money).”
Shumlin’s original budget proposal imposed a 33 percent cut in reimbursements for doctors. The Vermont Medical Society passed a resolution opposing the VHAP-Catamount merger last month.
Johnson said her committee was still trying to figure out whether it should move ahead with plans to save $1.9 million from the state General Fund and $4.4 million in Medicaid money by asking Catamount patients to contribute an additional $700 a year toward deductibles. (The current deductible amount is $500.)
Johnson suggested the deductible policy change could be considered separately.
The benefits package for Catamount would remain essentially the same. Johnson said that the $1,200 deductible would “provide a barrier to primary care.”
“It’s a lot of money for those income brackets to absorb,” Johnson said.
Peter Sterling, executive director of Vermont Campaign for Health Care Security and an early proponent of Catamount, is critical of the plan. He said it balances the state budget on the backs of beneficiaries. He said last year the BCBS “filed for three separate premium increases and MVP received rate increases in all four quarters.”
Sterling said the Catamount “haircut” plan will likely lead to rate increases that will be borne by Catamount subscribers.
“No one on either (committee) asked about what happens to the ‘savings’ from this plan when the inevitable BCBS filing for a premium increase happens,” Sterling wrote in an e-mail.
Kimbell said the Catamount proposal came from BlueCross BlueShield of Vermont, the state’s largest private insurer (and a nonprofit); the Vermont Association of Hospitals and Health Systems, a trade association; and the Vermont Medical Society. Kimbell is a former lobbyist who represented BCBS.
MVP was not informed of the proposal, according to Bill Little, the government relations official for the Schenectady, N.Y.-based insurer. “I don’t know anything about it,” Little said. “No one has contacted me.”
