Sunday, March 6, 2016

March 6, 2016 Legislative Update

Legislative Update

Rep. Anne Donahue

March 6, 2016


The pace will begin to speed up as we near the end of the first half of the second year of this legislative session. This Friday is “crossover” – the deadline for bills to be voted out of a policy committee if a House bill is even to be considered by the Senate, and vice-versa.

So, what to expect from the House Health Care Committee, where I sit?

I have drafted a bill that we are taking up this week to set parameters for any agreement with the federal government about an alignment between Medicare, Medicaid and private insurers.

Most important of all is this language:

“The Green Mountain Care Board and the Agency of Administration shall only enter into an agreement with the Centers for Medicare and Medicaid Services if the agreement… continues to provide payments from Medicare directly to health care providers without conversion, appropriation, aggregation, or any other involvement by the State of Vermont.”

The talk about Vermont entering into an “all payer” model has worrisome overtones.  I have heard unequivocally from Vermonters: “hands off our Medicare.”

The administration has said that no such agreement would involve the state controlling Medicare money.

There is no state law, however, preventing Vermont from doing that, and I think we should put it into law: no agreement permitted unless the agreement itself guarantees that the state doesn’t touch Medicare money.

It isn’t just about the money, either. So the bill includes other requirements. The agreement would be allowed only if it:

-- preserves all existing the consumer protections (including not reducing Medicare covered services, not increasing Medicare patient cost sharing, and not altering Medicare appeals processes), and

--  allows Medicare patients to choose their providers.

The federal government is already deeply involved in pushing for health care reform through new ways of paying for Medicare. One route is through contracting with organizations made up of health care providers that agree to be accountable for all services for its patients for a single lump sum.

These groups of providers are called Accountable Care Organizations, and there are three that already operate in Vermont. A Medicare patient who sees a primary care doctor who is a part of an ACO is “attributed” to that ACO. The ACO coordinates all of the patient’s care.

If you are on Medicare, you may already be attributed to an ACO. Apart from having received a letter about it two or three years ago, you wouldn’t notice anything different, and your doctors have not been paid any differently.

The coming change from Medicare is through paying via that agreed-upon lump sum, instead of paying through the traditional fees for each service you receive.

The biggest difference in the arrangement that Vermont is proposing to the federal government is that we make it possible for our Medicaid program and private insurance plans in the state to align into the same model.

All the major payers in Vermont (thus, the “all payer model”) could establish contracts with an ACO, creating a unified method of payment. Having more payers involved creates economies of scale, both in administrative costs and in managing good coordination of care.

A participating doctor wouldn’t need to worry about which insurance you had or how much each particular procedure costs, and could concentrate on best care.

But if the ACO does not meet its target for costs, it is the ACO that loses money. Perhaps the biggest fear for many is, how can we be assured that the ACO won’t scrimp on care in order to meet its budget targets?

In addition, for an ACO to function successfully and survive financially under the new lump-sum model, it must be made up of a very large network of providers, including hospital and physician services. As a result, the three Vermont ACOs are planning to fold into one.

That brings other worrisome features. If there is only one ACO, will it create too much of a monopoly? How do we ensure that the big hospital partners don’t control the decisions, and keep most of the money?

That brings us to other parts of the oversight bill my committee is working on.

Although Medicare allows ACOs to operate fairly independently as long as they meet budget and quality of care targets, we want stronger oversight of what will be Vermont’s single ACO.

The bill would require that the all-payer model allow providers to choose whether to participate in an ACO or remain independent. The ACO would be required to contract with non-ACO members to ensure their patients can access the providers they need and choose.

The ACO would be required to invest in primary care and other parts of the health care system that help prevent expensive hospital use. It would also require shared decision-making between doctors and their patients.

Under the bill, the Green Mountain Care Board would monitor quality of care and patient protections, including the right to appeal denials of care. It would require that the ACO governing body represents its participants equitably.

The ACO would not be permitted to “diminish access to any health care service for the population and area it serves.”

The Board would also review and approve the ACO’s annual budget, in the same way it currently reviews hospital budgets.

I think this oversight is crucial if this new model of payment is to be successful in helping to make the most efficient use of health care resources while also protecting the highest quality of care.

The “all payer model” is intended to help make the system pay greater attention to the full spectrum of patient health care needs instead of separate pieces, through changing the way providers are paid.

That alone is not going to radically alter the trajectory of increases in health care costs. But it may “bend the curve” of increases, and that bending is a necessity if we are to keep health care even remotely accessible.

What must come next? Greater equity in access.

Right now, if you are very low income, your access to health care is well protected. If you have a good health care plan through your job, your access to health care is also well protected; it is affordable mostly because the costs are hidden through the employer contribution.

Neither of those routes is sustainable. We are seeing that now in a state budget that is being crushed by the expansion of Medicaid access, and employers are seeing it in the impact on the costs of doing business. It only takes looking at the effect on school budgets this year to know that we can’t keep on this course.

But those in the worst situation are those who are not covered by their jobs, yet are over the limit for state-sponsored Medicaid coverage. Insurance on the health care exchange still leaves health care inaccessible for many: the cost-sharing on top of high premiums is too expensive.

We have to do better.

The all-payer model, if done right, is likely a good step, but it is only a baby step in the big picture of achieving access to quality health care.


Thanks for the honor of representing you! You can contact me or Rep. Patti Lewis by email ( for me; for Patti) or by leaving a message at the statehouse at 828-2228. We welcome your feedback and input.


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