Editor’s note: This commentary is by Richard Slusky, of South Burlington, who was the CEO of Mt. Ascutney Hospital and Health Center in Windsor from 1982 to 2010.
Judging from a number of articles and related comments in VTDigger over the past couple of weeks, one might conclude that the health care reform initiative in Vermont is on the verge of collapse and that the effort should be abandoned. I think it’s much too early to come to that conclusion.
In 2011, the Vermont Legislature passed Act 48 which created the Green Mountain Care Board and put the state on an admittedly bumpy path toward health care reform. In late 2016, building on a number of reform initiatives achieved over a five-year period, the state entered into a contract with the Centers for Medicaid and Medicare Services called the “All-Payer Accountable Care Organization Model Agreement.” (At the time, this was only the second such agreement between any state and Medicare.) This agreement called for, among other things, a target of an annual 3.5% growth rate in total (all-payer) health care expenditures over a five-year period, achievement of specific population health improvement targets, and inclusion of at least 70% of the eligible Vermont population into the program by 2022.
The agreement would be administered through OneCare Vermont, an accountable care organization that would be responsible for the management of payments to participating health care providers, and for overseeing the quality and performance of the health care system for which they are responsible. Regulation and evaluation of the ACO’s financial and quality performance would be the responsibility of the Green Mountain Care Board. The first actual performance year of the ACO was calendar year 2018.
Over the past several weeks there have been a number of articles in VTDigger regarding the ACO, and health care reform in general, that have triggered many public responses, mostly negative, regarding the perceived lack of progress of the ACO to meet the cost and quality targets described in the agreement
As one who participated in the design of Vermont’s health care reform programs, I understand and appreciate many of the concerns that have been raised. Hospital budgets continue to be approved at levels that exceed the 3.5% annual growth target that is specified in the all-payer model agreement. Insurance rates on the exchange approved by the Green Mountain Care Board approached double digit increases, and the Vermont Education Health Initiative on behalf of the teachers unions are requesting over 14% rate increases in some of the teachers’ health plans. In addition, population enrollment into the ACO program through 2019, although growing, is below the scale targets established in the agreement. These are all legitimate concerns that should not and cannot be ignored.
On the other hand, almost all of the hospitals in Vermont are participating with OneCare in the all-payer model. In 2019, approximately 160,000 Vermonters were enrolled in the ACO program. That number is expected to rise to 250,000 Vermonters in 2020, with a total health care expenditure cost of $1.36 billion. Significant increases in this part of OneCare’s budget is actually a good thing since it means that more Vermonters are being enrolled into the program, and more payments to providers are being made on a per-capita basis rather than traditional fee-for-service payments. This was one of the goals of the all-payer model.
Advocates and community-based providers should also be pleased to see that OneCare is planning to increase its community investment budget from $36 million (2019) to $43 million (2020) to expand care coordination programs and other community-based initiatives.
Finally, the general operating budget for OneCare is $19 million. Distinguishing these components of OneCare’s budget is important to take into account as we analyze the success of OneCare’s programs.
A VTDigger article on Nov. 9 focused on the reluctance of the Vermont state employees’ union to “participate in OneCare next year, while the teachers union remains on the fence, potentially dealing a major blow to the rollout of state-led health reform efforts.”
As noted above, the all-payer ACO model agreement requires that by 2022, 70% of all eligible Vermonters and 90% of eligible Medicare beneficiaries would be attributed to the ACO. I agree that this goal will be very difficult, if not impossible, for the state to attain if Vermont state employees and teachers are not enrolled in the program. According to the VTDigger article, together these two unions account for almost 75,000 Vermonters. However, I don’t agree with the statement of the state director of health reform that “the onus is on OneCare to make its case” to encourage these unions to participate.
It was the state through the Agency of Administration and the Green Mountain Care Board that executed the all-payer ACO model agreement. It was the ACO that was the vehicle through which the goals of the agreement would be achieved. It would seem to me that the onus for making the case to its employees and the state’s teachers union rests as much on the state through its administrative officials, as it does on the ACO. Since reaching a target of 70% enrollment of Vermonters is one of the principal goals of the state’s all-payer agreement, the governor and other administration officials have a responsibility to explain to Vermonters and particularly to state employees and teachers why enrolling in the ACO is the right thing to do, is in their best long-term interests, and is critical to the success of health care reform in Vermont.
I would also suggest that the state, through the Medicaid program, should adequately fund payments to primary care providers and hospitals at least to the level of the 3.5% growth that was targeted in the agreement. They should also seriously consider OneCare’s request to support funding necessary to expand care coordination services, embed pharmacists in primary care practices, and place mental health workers in emergency departments of hospitals. These are all steps that make sense to build the infrastructure necessary to transform the health care system and reduce the growth of costs.
In addition, the Green Mountain Care Board needs to hold the line on hospital rate and volume increases and not approve any hospital budget that exceeds the 3.5% target. The hospitals need to live within the terms of the all-payer model (3.5% growth) and reevaluate their business models in order to reduce costs, improve care, and reduce utilization of hospital services. That is, after all, the point of the entire health care reform initiative.The Vermont Association of Hospitals and Health Systems needs to support the Green Mountain Care Board on this, and put the burden on the hospitals, not the board to figure out how to make this work.
Responsibility for the success of the all-payer ACO model should be a collective effort on the part of all the stakeholders. Pointing fingers at the ACO, the state, the payers, the hospitals, the GMCB, or back at the critics, is not constructive. All the parties mentioned above, plus community-based providers and advocates, should meet regularly to discuss their concerns constructively and to work together to solve the problems, not just describe them. The governor should insist on these meetings, and should assign staff to facilitate the conversations, if necessary. The All-Payer ACO Model is a binding agreement between the state and Medicare. The administration needs to be directly involved to ensure its success.
