Meanwhile, treatment providers at some residential facilities are frustrated by the state’s shift to more outpatient services; they say residential treatment is vital and will save more money in the long term.
The hub and spoke system is comprised of seven hubs, or regional centers, throughout the state that provide medication-assisted treatment along with counseling and other services, as well as spokes, local doctors who also treat addicts and link them with medication and counseling.
The Shumlin administration this year proposed spending an extra $8 million in next year’s budget on the hub and spoke system, which was created in 2012. The Legislature this week is wading through the details of where that money would come from.
Funding will come primarily in the form of Medicaid dollars that will be saved by treating patients through hubs, according to a financial analysis by the Department of Vermont Health Access.
DVHA has estimated the state next year will save $6.7 million by treating patients through hubs, and plans to reinvest that money in the hubs to serve more patients.
To calculate the $6.7 million in anticipated savings, DVHA surveyed 490 patients who were admitted to the first hub — the Chittenden Clinic in Burlington. Officials analyzed two years of Medicaid claims data for those patients before they were admitted to a hub, then one year of claims data for the year following their admission, according to DVHA Commissioner Mark Larson.
The results show it cost less to treat patients when they were treated through the hub, Larson said.
As a result, DVHA has projected that for the 2,164 patients estimated to be served statewide, the savings will be $6.7 million. There will also be $1.3 million in new federal funds, Gov. Peter Shumlin has said.
According to the DVHA analysis, while there will be an overall savings by moving patients to hubs, some areas of treatment will cost more, including home health and durable medical equipment.
The state expects savings in areas such as residential treatment, independent lab work and outpatient payments, according to the DVHA analysis, which was presented to the House Appropriations Committee.
While data reflect that hubs save money, there has been no analysis of whether patients in the system have more success in battling addiction. The system is less than two years old and officials acknowledge it is a work in progress.
The state is working on developing a way to track patients’ success, Beth Tanzman, who oversees the spoke program for DVHA, told the Green Mountain Care Board on Thursday, during an overview of the hub and spoke program.
The Department of Corrections has agreed to provide DVHA with incarceration data so it can cross-reference hub and spoke patients, Tanzman said. DVHA is also seeking employment data from the Department of Labor and Department of Children and Families data about the out-of-home custody of kids, Tanzman said.
“It may actually be the one of the first times we can really combine the health and services measurement strategy together,” Tanzman.
The DVHA analysis shows an anticipated $967,654 reduction next year in money spent on inpatient treatment.
However, like any budget decision, that number represents a “leap of faith,” said Rep. Kitty Toll, D-Danville, a member of the House Appropriations Committee, which is responsible for the Alcohol and Drug Abuse Program (ADAP) budget.
“They’re basing it on data, but I think that there’s a lot of variables that can have an impact,” she said, adding that she is not convinced that there will be a reduction in the amount of inpatient services needed.
The budget bill her committee is considering this week instructs the Joint Fiscal Office to review the 15-day pre-approved residential substance abuse treatment limit for adult Medicaid recipients.
The Joint Fiscal Office will consider best practices, private insurance practices as well as the relationship between the number of days in residence and patient outcomes, according to the bill.
The budget bill will also include language asking the Agency of Human Services to report back to the Legislature on the results of the plan to invest $8 million in hub treatment.
The study will need to show whether the $6.7 million expected savings was realized as well as treatment outcomes, Toll said.
Meanwhile, some residential treatment centers say the shift to outpatient treatment at hubs and spokes is needlessly penalizing residential facilities.
While not all patients need treatment at a live-in facility, some do, they say.
Last spring and summer, the state reduced the number of residential treatment days that Medicaid covers to 15.
That is about half of what many patients need, said Rick DiStephano, vice president for clinical services at Valley Vista, a residential treatment center in Bradford.
Facilities can ask ADAP for an extension and more than 90 percent of the time it is granted, according to the treatment facilities and ADAP.
DiStephano said the state likely will see a savings after this year, because Valley Vista isn’t treating patients for as many days.
When Valley Vista’s 18-month contract ($4.9 million annually) ends this year, it expects not to have billed about $600,000 in treatment services, DiStephano said.
Since implementation of the 15-day length of stay, Valley Vista has had empty beds, DiStephano said. Of its 80 beds, about 50 are full. Two weeks ago about 30 were full, he said.
Meanwhile, requests for readmission have risen, he said. In the long run, the state could save money by treating patients longer in residential facilities rather than paying for medication they receive in outpatient hubs and spokes.
“It’s like the state has a Suboxone intoxication,” DiStephano said.
Health Department officials say they settled on 15 days by looking at the average length of stay among the state’s three residential treatment providers, Valley Vista, Maple Leaf Farm in Underhill and Serenity House in Wallingford.
“We’re really trying to get away from that kind of one-size-fits-all,” said Barbara Cimaglio, deputy commissioner for alcohol and drug abuse programs.