by Emma Lamberton Vermont Watchdog Over 50 people gathered at the Montshire Museum of Science in Norwich on Monday to hear from the governor and the Green Mountain Care Board about the draft of the administration’s all-payer waiver, approved last week. The waiver allows for the distribution of Medicare, Medicaid and private insurance funds through one giant Affordable Care Organization, which will operate under the payment model of reimbursing providers for overall population health, rather than per-procedure.
Vermont has had several forms of Medicaid waivers over the past several decades, but this is the first time Medicare will be included, raising concerns with seniors in attendance over changes to their care.
“There is absolutely nothing about an all-payer model agreement that changes the Medicare benefits that people work their whole lives for … only an act of Congress can change Medicare benefits,” said Michael Costa, deputy director of health care reform, at the beginning of his presentation.
However, covered benefits are not the only aspect of health care. The all-payer model, which the Shumlin administration has defined as a “test,” radically overhauls Vermont’s system in a way other states have never tried. While the administration believes the new system will cut costs and increase the quality of care, there is no way to know for sure until the waivers take effect.
“If you don’t like your doctor halfway through the year, but he’s got all the money, what do you do then?” asked one senior from Norwich who attended the meeting.
The ACO will distribute funds to hospital systems and independent practices based on their service population. Under the waiver, Medicare, Medicaid and private insurance will pay the ACO in advance the projected rate per customer.
The “cost shift,” meaning the discrepancy in the amounts paid by private and public insurers, will remain for payers. Private insurance plans pay more than their beneficiaries use, to make up for the underpaying programs of Medicare and Medicaid. The cost shift ultimately falls to Vermonters who, if they are on public insurance, pay for over twice the coverage they actually use in the cost shift’s redistribution to public programs.
However, providers should no longer see the cost shift, said Al Gobeille, chairman of the Green Mountain Care Board. This should lead to more access, as providers no longer have an incentive to choose one customer over another, based on payment rates.
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Vermont has draft agreement with feds for all-payer health care model Public forums to present draft All-Payer Model: Burlington Oct 6, Rutland Oct 11 |
This could potentially help independent practices who have struggled in Vermont because of reimbursement discrepancy. In the old fee-for-service health care system, hospitals were able to negotiate higher reimbursement rates because of their growing monopolies of the health care system. Now that payments go directly to the ACO, there is potential for small, independent practices to be reimbursed at similar rates as larger hospital systems.
Gobeille assured the audience of health care practitioners, legislators and seniors that under the new system a provider will not be punished for poor population health. It is unclear whether the ACO will actually have the ability to keep costs down if providers have no incentive to stay in budget.
The ACO is proposed as a “risk-bearing” organization, meaning it will absorb the deficits of providers. Even if the ACO absorbs deficits, said Gobeille, the ACO can still profit through the overall savings of the system.
If reducing costs proves harder than anticipated in the new “test,” the ACO will likely have to impose penalties on providers who go over budget. This could lead to potential restrictions in care.
However, no providers are being forced into the system. While the ACO needs a critical mass of providers who represent 30 percent of the population, Vermonters will likely have the choice to see doctors and other providers who have opted to remain in the old system.
Providers and individuals can easily give feedback on the new system by choosing where they practice and receive health care, said Gobeille. “Vote with your feet.”
Contact Emma Lamberton at [email protected]. Vermont Watchdog October 4, 2016