State health care regulators at the Green Mountain Care Board have cut the annual operating budget for OneCare Vermont for the second year in a row, citing ongoing questions about the effectiveness of the accountable care organization and how executives are compensated, as well as about what the organization’s future role in the state will be.
But the board’s budget review of two other accountable care organizations, or ACOs, newly operating in the state — Vytalize and Lore Health — which occurred earlier this month, drew the greatest public interest.
On Wednesday, the board unanimously approved OneCare’s overall organizational budget of $22.2 million for 2024. Prior to that, however, board members voted, 4-1, to require the accountable care organization to shift $957,000 from internal operations (out of a total of almost $14.3 million) into funding its community health or primary care support programs. Recently reappointed member Robin Lunge was the solitary ‘no’ vote.
Prior to the vote, OneCare leadership told board members that the nonprofit organization had followed the board’s earlier budget guidance, so adjusting its budget further was “moving the goalposts.” Also, as a private organization chartered under federal law (the 2010 Affordable Care Act), its own board, not state regulators, should direct the details of the OneCare budget, its leaders argued.
“For OneCare, cutting the operating budget means losing essential resources needed to fulfill the strategic objectives set forth by our board of managers,” OneCare CEO Abe Berman said during public comments.
During this process last year, the care board reduced the ACO’s 2023 operating budget by roughly $300,000. The board went on to further amend that budget in June of this year, redirecting roughly $370,000 from executive bonuses to additional payments to primary care providers. That change is currently under appeal to the Vermont Supreme Court.
“No other ACO in the country is regulated in the way that we are,” OneCare board Chair Anya Rader Wallack said in a rare appearance before the board. She previously advised two Vermont governors on health care policy and helped found both the Green Mountain Care Board and OneCare.
“It also makes me question, ‘Why is there a board of directors of OneCare if you are going to get into kind of line-item editing of our budget?’” Rader Wallack asked rhetorically.
Care board member David Murman defended a more engaged role for the state regulatory body.
“It really is Vermonters’ money that is going to OneCare,” he said.
The state’s hospitals pay most of OneCare’s operating budget, which, in turn, comes from private insurers and insurance premium payers and taxpayer funds, Murman said.
“When I think about evaluating OneCare’s budget, I think of our responsibilities as a board to ensure that Vermonters’ money is being spent in the most optimal way to meet the goals of improved access, improved quality, reduced cost, improved equity, those things,” he said.
The future AHEAD
Board member Thom Walsh — who approved of the adjustment but had initially asked for an operational cut four times that size — said during discussion that when an organization is struggling, the best course is for it to focus on its primary purpose.
“As far as I can tell, the essential function that OneCare serves is as a receiver of the federal dollars and (their) distribution — it’s a pass-through organization,” Walsh said. “Because of the way that they do their budget, I have not over the past few years been able to identify how much it costs to be a pass-through organization.”
OneCare is Vermont’s only “all-payer” accountable care organization, meaning that it contracts with the federal Medicare program, the state-federal Medicaid program and private insurance providers. As such, it currently plays a pivotal role in Vermont’s health care payment reform efforts — an attempt to move health care spending away from paying for specific services, such as visits, operations or tests, toward rewarding health outcomes.
Through a unique contract with the federal Centers for Medicare and Medicaid Services active since the start of 2018, an ACO is the designated vehicle for bundling payments and incentives from the many different health care payers and passing them on to participating hospitals and other health care providers in the form of regular monthly up-front payments and end-of-year bonuses or penalties.
However, Vermont’s special “all-payer” agreement is set to expire at the end of 2024. A one-year extension through the end of 2025 appears likely but is not possible beyond that, said Pat Jones, state Agency of Human Services interim director of health care reform, in a presentation on Dec. 13.
The agency must submit an application to participate in a new multi-state payment reform project called the AHEAD model by mid-March, Jones said. The role of accountable care organizations in the new program is unclear, though the Department of Vermont Health Access, which operates the state Medicaid program, is working with OneCare on piloting one aspect of the payment program next year, Jones said.
Asked about her hopes for the new health care payment model, Jones suggested cautious optimism. But, she warned, “payment changes are a means to an end, but they are not the end, and they are not the only thing that needs to happen in order to transform care.”
“Changing how you pay doesn’t mean that organically care delivery will just happen,” Jones said. “There has got to be intentionality to it. There’s got to be support.”
Landing the plane
Walsh referred to OneCare as a plane that “has had difficulty from liftoff,” with “malfunctions along the way,” at the Dec. 13 meeting.
“It’s not going to get us where we want to go” but “it needs to land safely,” he said.
At Wednesday’s meeting, Murman expressed more optimism about OneCare’s continuing relevance in some fashion.
“We really want a thriving ACO in Vermont. I mean, that is still the goal, and OneCare is important in so many of the programs in Vermont,” he said.
Both Walsh and Murman underscored the importance of OneCare’s direct support to primary care providers and the almost $10 million the organization provides to fund the state’s Blueprint for Health regional community health teams and its SASH home support program.
However, Murman said, “I think we are at a transition of the role of OneCare in Vermont’s health landscape.”
In offering her comments, Rader Wallack defended OneCare’s efforts in the state. “I challenge you to find a place in the country where anyone’s done better,” she said.
“OneCare has not been successful in all its endeavors, but it has been a great thing in Vermont. It’s achieved a lot,” she added. “It’s sort of unfair to equate OneCare’s achievements with (the question of) has Vermont achieved health care reform or not, has Vermont achieved something that nobody else in the country, or frankly in the world, has achieved.”
Lore Health and Vytalize
In contrast to recent years, OneCare did not receive the most public attention during its budget review. That was saved for an ACO new to the Vermont market called Vytalize. There were 58 separate public comments, most of them fretful about or opposing the for-profit ACO’s activities.
Vytalize provided its first budget submission to the care board in order to work with two federally qualified health centers — Little Rivers Health serving 1,350 patients in Orange County and Mountain Health Center serving around 660 patients in Bristol. The special FQHC designation allows the centers, both situated in rural areas, to receive enhanced payments from Medicare and Medicaid.
Vytalize and Lore Health, which contracts with providers at an FQHC active in southeastern Vermont called North Star Health, only engage with the federal Medicare program, giving the care board, a state entity, limited jurisdiction. The 2024 budgets for both organizations were approved by the board in votes on Dec. 6.
Most public comments expressed concerns among patients about the interference of an investor-owned company in their primary care.
That view was echoed by Walter Carpenter, a Montpelier resident who said, “I wish the board did have the authority to knock back Vytalize and Lore because I don’t see them doing anything for us other than siphon off our dollars.”
Green Mountain Care Board staffer Michelle Sawyer stressed at that meeting that participation as a patient in a Medicare ACO program is not the same thing as being enrolled in a Medicare Advantage private insurance program. ACO participants are still covered by traditional Medicare, she said.
Andy Barter, CEO of Little Rivers Health, told the board and other meeting attendees that the organization has not previously been affiliated with an ACO and hoped to take advantage of the stabilizing upfront payments that relationship provides.
“I also wanted to reassure that no external entity will intervene with patient-centered care here directed by our providers solely,” Barter said. “That will never change and we hold to that.”
Board members said they read all the comments provided by the public and empathized with their concerns.
“I understand the frustration that there is profit going away from Vermont,” Murman said. “But it appears to me that the providers are benefitting substantially.”
Corrections: An earlier version of this article incorrectly characterized the type of annual oversight that the Green Mountain Care Board’s provides to Medicare-only accountable care organizations. It also incorrectly identified the Vermont health care organization that contracts with Lore Health.
