by Teresa A Fama, MD MS It’s time for the Green Mountain Care Board (GMCB) to develop different methods to control health care spending in Vermont. The GMCB uses blunt measures based on price and volume, two main tenets of an old fee-for-service financing system dating back to the 1980s – or even earlier – that ignore the escalating healthcare needs of an aging population and do not capture the impact of the innovative tools we are using to care for patients.
Price and volume are crude metrics that do not tell the story of current health care delivery. Care today includes staffing shortages, high turnover rates, more temporary (and costly) workers, more hospital workers being unionized and offered higher wages, and increasing pharmaceutical costs.
Since the pandemic, we are seeing longer wait times for our patients to obtain primary and specialty care. With these mounting pressures, there is a growing sentiment among clinicians (physicians and advanced practice providers) that these forces are fueling burn-out, driving some to retire early and increasing recruitment costs to maintain an ample supply of clinicians.
The prices hospitals charge commercial insurance companies like Blue Cross are regulated by the GMCB. Hospitals are paid by three main types of insurers – private insurance companies, Medicare and Medicaid, with the latter two run by the state and federal governments. Hospitals have no control over the “price” they can charge those public payers, which reimburse hospitals at a much lower rate than private insurers. A report to the GMCB in 2020 showed the ratio of payment to costs by payer was around 72% for Medicaid, 78% for Medicare and 150% for commercial payers. Since 2000, the percentage of Vermonters with private insurance has decreased from 60% to 49% as of 2021, with the balance mostly covered by Medicare and Medicaid.
In addition to regulating prices charged to commercial insurers, the GMCB imposes a cap on “net patient revenue,” which limits how much money hospitals can be paid for providing care. This isn’t margin or profit, but simply the dollars coming in from providing care. The only option for hospitals to cover increasing expenses is to charge higher prices or to increase volume, but both must be below certain amounts, otherwise Vermont hospitals get penalized for providing too much care. And yet, the GMCB has implored the University of Vermont Health Network (UVMHN) to improve access to care and facilitate patients being seen sooner. The GMCB’s budget order also indicates that UVMHN physician productivity is low. This translates into a curious message from the GMCB to physicians: work harder but not too hard.
We are employing innovative tools, such as electronic consults and enhanced referrals that support primary care clinicians, even though this work is not captured in any GMCB metrics.
The GMCB has done great harm to clinicians by criticizing productivity, without recognizing the limitations of how we’re currently measured. How we historically have measured productivity is outdated – based only on a “face-to-face" visit. Today patients are looking to access to care in ways that don’t entail a traditional office visit such as with electronic consults, MyChart messages, and care coordination activities. Clinicians do not get credit for these activities. Last year primary care clinicians at Central Vermont Medical Center received over 78,000 MyChart messages, an increase of 270% compared with 2020. Clinicians respond to these messages outside of the time scheduled to see patients, including after hours. A colleague makes an analogy to what we are experiencing to that of measuring a bank’s productivity only by the number of customers who visited the bank in-person to do a transaction (withdraw or deposit money, apply for a loan), as we did in the past. If measured this way, then banking productivity would have significantly decreased over the past decade because it didn’t include access to ATMs, online banking, direct deposit, and applications such as Venmo.
The GMCB continues to base its cost containment framework on metrics of the past that are founded in a model where price and volume are the key levers of cost containment and fail to recognize care delivery innovations not captured in these traditional metrics. Until we give hospitals and clinicians an infrastructure to change fundamentally how we provide care to all residents in our state that strives to improve patient outcomes, hospitals will struggle, services will be cut, and patients, their clinicians and hospital staff will bear the brunt of these decisions.
Teresa A Fama, MD MS, is a rheumatologist at the University of Vermont Health Network (UVMHN)-Central Vermont Medical Center. Dr. Fama is Vice Chair of the UVMHN Medical Group Board. She is also a manager of OneCare Vermont’s Board of Managers.