The Shumlin Administration has unveiled the framework of a plan that will completely change how health care providers are paid in Vermont.
Gov. Peter Shumlin says the new system is designed to help contain health care costs while providing better outcomes for patients.
The concept of what's known as the “all payer” plan is pretty basic. The goal is to shift away from the current system, known as fee-for-service – which reimburses providers for treating people when they get sick – and move towards a model that pays providers to help keep their patients healthy.
“Instead of paying for every test, every procedure, doctors and hospitals would receive a set of payments for frankly keeping us alive and healthy and feeling good,” Shumlin said Monday.
The concept might be simple, but the implementation of the plan is complicated. It requires a waiver from the federal government because it involves Medicaid, Medicare and the private insurance companies. There are a lot of details to be worked out over the coming months, including how the new payment system will be structured for primary care doctors, specialists and the hospitals.
"It's important to note that none of this is set in stone, that it can all be changed,” Shumlin says. “And that what we wish for is a transparent, thoughtful process where we invite everybody to help us make this even better.”
Shumlin says the goal is to limit the annual growth of health care spending in Vermont to roughly 4 percent in each of the next five years.
“Cost containment is clearly the most important part of the puzzle, because without cost containment nothing goes well for us. Businesses struggle, Vermonters struggle, we all lose,” he said.
Dr. Craig Jones is the director of the state's Blueprint for Health, a program that emphasizes the use of preventive care for people with chronic illnesses. These illnesses account for 86 percent of all health care spending in Vermont.
Under the new system, Jones says primary care doctors will receive a set amount of money for each of their patients. Jones says the change will allow the doctors to spend more time with their patients with the goal of improving their health outcomes.
“It's structured so that you know up front, you have a certain amount of money every month for the population you're supposed to care for, and you have quality measures you're supposed to meet,” Jones says. “Then you can change how your practice operates. It no longer has to just cycle people through make sure the revenue is in at the end of the month.”
The Green Mountain Care Board will begin its public review of the all payer model later this week. State officials hope to win federal approval for the final plan by the end of this year.