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The coronavirus pandemic has prompted the Green Mountain Care Board to loosen requirements that govern the state’s health care reform project.
The board’s regulators are asking the federal government for changes to Vermont’s all-payer contract that could ultimately send more money back to hospitals. The board has also called for 2020 to be a “reporting only” year, meaning that hospitals and OneCare Vermont won’t be held to the quality metrics in the contract.
The changes, if adopted, will effectively halt the state’s health care reform efforts for the time being. On Wednesday, the board voted to approve a draft letter, which will be reviewed by Gov. Phil Scott and the Agency of Human Services. The state will then send the letter to the federal Centers for Medicare & Medicaid Services for approval. Both the state and federal government must agree to the amendments before they can be finalized.
In the letter to the federal government, the Green Mountain Care Board invoked a clause of the contract that stated the deal could be revised in the case of catastrophes such as natural disaster or economic shock. They asked to eliminate financial risk for hospitals, stop holding providers to certain health metrics, and allow OneCare to forgive some hospital payments.
Susan Barrett, executive director of the regulatory board, couldn’t say how the changes might impact the state’s health care system long term. “Everything is open and fluid at this time,” she said. For now, the board’s focus is mitigating the impact of the virus: “The ultimate goal [is] relief for frontline providers,” she said.
The state of Vermont is midway through a five-year health reform effort, but the coronavirus pandemic has shifted the priorities of state officials. While hospitals prepare to care for Covid-19 patients, their income from other procedures has plummeted. Fewer patients are seeing the doctor as offices cancel non-urgent visits to reduce spread of the virus.
Some Vermont hospitals have lost as much as 70% of their revenue, according to the Green Mountain Care Board. Independent practices are buckling under heavy financial losses. Even the largest hospital in the state, the University of Vermont Medical Center, has laid off some workers and forced doctors to take pay cuts.
The disruption also would make the data collected by OneCare unreliable, said Barrett. “This year, from mid-March to who-knows-when is a complete anomaly,” she said.
Last week, OneCare wrote to the board asking that reporting requirements be waived or relaxed. “Assuring that the delivery system can withstand the initial and future impacts caused by the Covid-19 pandemic is critical to maintaining Vermont’s health care system,” wrote OneCare CEO Vicki Loner. OneCare has not waived hospital dues, she said in an interview, but staff are working with the state hospital association to meet hospital needs. They’ve also created an app that will identify people who are more vulnerable to Covid-19 and help ensure they have the care they need.
Vermont created its all-payer model in 2016, in the wake of the state’s failed single payer efforts. The approach is unique nationally. One for-profit accountable care organization, OneCare Vermont, receives money from Medicare, Medicaid and private insurance companies and distributes the money to hospitals and health care providers. Rather than paying for each procedure as has traditionally been done, OneCare would transition to flat monthly payment per patient to each participating hospital.
The idea is to save money and encourage doctors to keep people healthy by incentivizing preventive care.
The experiment was launched as a five-year contract between the state and the federal government and is set to end in 2022. Now, roughly 30% of Vermonters are participating in the model.
Barrett said she did not know whether the changes would apply through the calendar year, or beyond. Nor could she say whether it would extend the five-year all-payer contract an extra year to make up for the lost time. “This is all uncharted territory,” she said.
It will prove difficult to create next year’s budget, Loner said, and to set the health metrics for the future. “I hope it doesn’t put the all-payer model at risk,” she said.
But the virus has shown the value of the model, she added. Doctors who are getting paid a steady monthly fee per patient can weather the financial toll much better than those in the traditional payment structure. If the state had fully transitioned, “we’d be a lot better off right now,” Loner said. “If anything, it just really shows the need to get away from fee-for-service, because that is not supporting our provider community right now.”