Editor’s note: This commentary is by Richard Slusky, who was CEO at Mt. Ascutney Hospital and Health Center for 28 years and served as director of payment reform at the Green Mountain Care Board from 2010 until 2016.
I would like to take the opportunity to offer my thoughts on the unique opportunity the Vermont all-payer model offers to Vermonters. My perspective comes from 34 years of service to Vermont health care, both as a leader of community-based patient care and as a regulator. I served as CEO at Mt. Ascutney Hospital and Health Center in Windsor for 28 years, from 1982 to 2010. Following a brief two weeks “retirement” in 2010, I was asked by the State of Vermont to accept the position of director of payment reform, initially with the Department of Vermont Health Access under the Douglas administration, and then, when it was created, the Green Mountain Care Board. After nearly five and a half years in this capacity, I retired again at the end of May 2016.
Simply put, I can’t disagree more with Patrick Flood’s commentary that called the all-payer model deeply flawed. I would like to offer my thoughts in support of value-based reform for Vermont’s health care system, because I feel some balanced context was necessary due to the importance of this issue and the impact the all-payer model, should it be approved, may have on Vermonters for years to come.
I accepted the position with the state, because for over 30 years, I have participated in, led, volunteered and facilitated many efforts to drive reform of our health care payment and delivery system. Although we have achieved impressive results in Vermont for high quality services, access to care, and relatively low cost, the system remains too expensive for too many Vermonters. If our current fee-for-service reimbursement system remains in place, costs will continue to outpace inflation in the future, making access to health care services even more unaffordable. The fee-for-service payment system has resulted, not surprisingly, in an uncoordinated approach to health care focused more on the volume of services provided rather than on the health of Vermonters. The all-payer model and use of accountable care organizations (ACOs) as the vehicle for reform turns that approach on its head.
I want to be clear that it has never been my position that a state funded single payer system is the appropriate course for Vermont. Although Vermont should be praised for expanding subsidized health and dental care services for children and adults, and for its focus on community based programs such as home health, mental health and substance abuse programs, the reality is that the health care delivery and payment systems are currently not designed to provide efficient and well-coordinated health care services. What is needed are health care payment and delivery system reforms that will result in a much more integrated system of care based on collaboration among providers and payers, better health outcomes for Vermonters, and better management of overall health care costs.
The central agreement in the all-payer model involves a commitment to grow health care costs at a targeted rate designed to stop the march toward unaffordability, and to give us the best chance to reduce costs over time.
I also feel some context for how we arrived at this juncture is warranted. First of all, the Centers for Medicare and Medicaid Services (CMS), which is by far the largest payer for health care services in Vermont and the nation, has been leading the movement away from fee for service incentives to value-based payment models through the expansion of ACO shared savings programs throughout the country. Although it is true that early results from the shared savings programs have been mixed at best, CMS is continuing to evolve their programs and continues to believe that developing a more value based payment model through ACOs is the right approach. Specifically, CMS is moving from the relatively weak incentives of the “upside only” ACO shared savings programs to an approach which requires ACOs to accept more accountability for both financial and quality performance. Vermont’s all-payer model is fully consistent with this approach.
A second point of context is that for the past five years I facilitated health care reform discussions and negotiations among hospital leaders, insurance company executives, primary care providers, mental health and substance abuse providers, directors of home health agencies, representatives of federally qualified health centers, health care advocates, and many other interested parties. During the past two years, representatives of this group have focused specifically on how to prepare for a potential all-payer model agreement with Medicare (CMS). With an average attendance of 20 to 30 stakeholders, we met nearly every Monday morning for approximately four hours per meeting to discuss the topics listed below. (It is worth noting that Patrick Flood participated in almost all of these meetings, and was a major contributor to the conversations and decisions.) Some of the areas we discussed included:
• Should there be one ACO or more than one ACO in Vermont?
• If there is one, how should it be governed, and what restrictions/oversight on its authority should there be?
• How, and how much, should primary care doctors be paid given their importance to the system, and what guarantees can be made to them to make their practice lives more attractive?
• How will hospitals be paid in the future, recognizing that the current inefficiencies in the system must be addressed over time, but without causing the breakdown of our system?
• Will critical access hospitals and federally qualified health centers continue to have access to the Medicare payments from which they currently benefit, but still be attracted to participate in an integrated system?
• How do we reduce the fragmentation in our health care delivery system, while preserving the autonomy and important role of community based providers to identify and pursue priorities on a local and regional level?
• How do we better fund the preventive services which can reduce use of emergency rooms and hospitals particularly for Vermonters with chronic health conditions?
• What are the data and analytics systems needed to support the changes needed to be successful in this new model?
As a result of these discussions, a document titled the Vermont All-Payer Model Framework (Framework) was submitted by this group to the Green Mountain Care Board in December 2015. (The “Framework” is available on the GMCB website http://gmcboard.vermont.gov under the topic “Payment Reform/All Payer Model” for those who might be interested.) Although not every member of the group agreed with everything outlined in the document, the Framework is an expression of a provider/payer approach to health care reform that was presented to CMS and served as an outline and starting point for negotiations regarding an all-payer model.
This is a unique opportunity for Vermont, and based on my experience and direct involvement in this long process, this opportunity will not come around again any time soon.
So, contrary to Patrick Flood’s assertions that very few details about this plan are known, the reality is that a very comprehensive outline of the plan does exist in the Framework. Also, a broad based governing board of a unified ACO called Vermont care organization (VCO) has been formed and is currently meeting and is in the final development of a business plan to apply the Framework and align with the terms of the all-payer model. The complete materials regarding the all-payer model have also been publicly released and are currently under review, and providers are being assured it will be up to them to consider whether they want to voluntarily participate in this model.
Patrick also claims that this is “a plan to privatize health care in Vermont by turning over management of health care from state government to a private agency.” As I stated at the beginning of this commentary, I do not believe in a government funded single-payer health care system, and to my knowledge, Vermont has never had a government managed system. We have private, not-for-profit hospitals, home health agencies, and mental health and substance abuse agencies that do receive public funding, but are not managed by the state government. The all-payer model hopes to integrate these services through voluntary participation agreements with an accountable care organization that will eventually receive fixed payments for many of the services offered, and will be accountable to the state and the Green Mountain Care Board to meet its contractual obligations.
As noted above, Medicare is moving away from fee for service payments and heading quickly toward a majority of value based payments by 2018-2020, Vermont Medicaid is currently negotiating with the ACO on value based payments beginning in 2017, and Blue Cross Blue Shield of Vermont cannot be far behind. What the Vermont all-payer model offers providers is the opportunity to voluntarily participate in these alternative payment models. It is up to them to decide whether participation in this model is in their interest and the interest of Vermonters or not.
Patrick knows full well the details of this plan. He has been an active participant in the development of the model, and he knows the effort and goodwill that has gone into the planning process. He also knows that everyone involved has gone to great lengths to ensure that the governance structure is fair, that the commitment to primary care providers is real, and that local and regional community based services will continue to be supported.
He also knows that delaying a decision on the APM means rejecting the plan. Years have been spent discussing options and considering the pros and cons of this approach. This is a unique opportunity for Vermont, and based on my experience and direct involvement in this long process, this opportunity will not come around again any time soon. This is the option that is on the table. We can accept or reject it, but the time for a decision is now.
