Editor’s note: This commentary is by Susan Aranoff, J.D., who is a senior planner and policy analyst for the Vermont Developmental Disabilities Council.
Judging from a recent uptick in VTDigger commentaries about health care reform, Vermonters have many questions about our state’s experiment known as the All-Payer Accountable Care Organization (ACO) Model. None is more pressing, however, than this: What can the Legislature do to evaluate the work of OneCare Vermont in preparation for the potential extension of our state’s unique approach to managing health care costs and population health.
Yes, that’s correct. The all-payer ACO model is already approaching the finish line under its first agreement from the Centers for Medicare and Medicaid (CMS), which expires at the end of 2022. If lawmakers intend to define the terms of renewal, as they did broadly for the current agreement, then they need to commission an independent study prior to the 2021 session.
Lawmakers have every reason to proceed with caution and to seek the very best advice. Of critical importance is the impact of the all-payer ACO model on the Medicaid program because it is the safety net for Vermont’s most vulnerable, and costly, citizens.
Vermont has invested considerable public resources in standing up OneCare Vermont and the all-payer ACO model. As proposed to the Green Mountain Care Board, OneCare’s 2020 budget includes more than $13 million in Medicaid funds to continue building out the model. This would come after several earlier infusions of Medicaid Delivery System Reform funds. The Department of Vermont Health Access gave OneCare over $10 million dollars in 2017 and 2018. OneCare’s 2019 budget indicates that it expects to receive an additional $10.8 million, though this has yet to appear in the state’s 2020 budget; it is likely to surface when the Legislature begins its budget adjustment process.
Public funds also flow to OneCare through the uniquely favorable terms it has negotiated with the Department of Vermont Health Access. For instance, in contrast to Medicare and the private insurance participants, when the model began, Medicaid gave OneCare a monthly administrative payment for each Medicaid beneficiary attributed to the ACO program.
Despite the various ways that Vermont Medicaid has stretched to support the all-payer ACO model, there has yet to be a clear benefit to the Medicaid program or its recipients. OneCare’s Medicaid losses exceeded $1.5 million in 2018, and OneCare projects that its Medicaid losses in 2019 will top $8 million. Similarly, quality indicators are moving in the wrong direction. In 2018, OneCare scored worse on seven out of 10 Medicaid quality measures when compared to 2017.
For all these reasons, the Vermont Legislature should act now to commission an independent study that evaluates the impact of this model on health, health care costs, patient access, affordability, and quality of care. The study should also consider alternatives to the all-payer ACO model and develop contingency plans should legislators decide not to extend the experiment.
This study must be independent because both the Green Mountain Care Board and the Agency of Human Services are parties to and active promoters of the all-payer ACO model. At a minimum, it should include an accounting of all public funds and assets that support the all-payer ACO model and an assessment of the return on that investment.
The study should answer the following questions:
1. How much has Vermont invested in the all-payer ACO model, accounting for public funds and assets from all sources, including but not limited to Delivery System Reform funds, Health Information Technology, Blueprint, SASH (Support and Services at Home), support for VITL (Vermont Information Technology Leaders), and the cost of dedicated staff within the Agency of Human Services and the Green Mountain Care Board?
2. How much have Vermont’s hospitals invested in OneCare and the model? How have these investments impacted hospitals, insurance premiums, Medicare and Medicaid?
3. What is the return on this investment in terms of: health care quality; health outcomes for Vermonters, especially for medically underserved groups; access to care and its affordability; and generating a predictable, sustainable rate of cost growth in health care?
4. Have there been unintended consequences of the APM-ACO? These include but are not limited to: cost shifts related to increased reimbursement rates for Medicaid and Medicare part A/B that negatively impact long-term services and supports; the impact on Vermont hospitals of costs associated with enrollment in OneCare, such as dues and insurance for risk; and the impact of provider consolidation on health care prices and consumer choice.
5. The Legislature conditioned the state’s participation in the all-payer model agreement on the alignment of this approach with the principles for health care reform set out in Act 48. With a few years under its belt, how well does the model line up with those principles?
6. If CMS requires the attribution of high-risk Medicaid populations, which seems likely, is the model sustainable in its next iteration? For example, Medicaid does not currently attribute newborns, who rarely require extraordinary care but are very costly when they do, to the all-payer ACO model. Similarly, individuals who are dually eligible for Medicaid and Medicare – typically older, poorer, and sicker than most Vermonters – remain DVHA’s responsibility.
7. Finally, what are the implications of moving forward for Vermont’s community-based service providers? The next iteration of the all-payer ACO model must incorporate all Medicaid-funded services under its financial caps. Though it’s not clear what this would look like administratively, this would include the home and community-based services that are provided to older Vermonters and to people with significant disabilities.
It’s time for the Legislature to take back control of Vermont’s health care reform efforts. For that to happen, lawmakers must ready themselves with all available facts and objective analysis. This will ensure that Vermont makes sound public investments as it continues on the path toward the triple aims of lower cost, increased access, and improved quality of care.
