Federal approval of reform plan shines national spotlight on Vermont

UVM Medical Center helps shape bold new approach

Vermont officials and the U.S. Department of Health and Human Services reached a landmark agreement in October that gives the state regulatory flexibility to build a system in which providers will be paid based on their efforts to keep patients healthy, rather than the current approach which pays based on the number of tests and procedures they perform.

In this so-called “all-payer model,” every insurer – Medicaid, Medicare and commercial health plans – will pay a set amount of money for each person they cover to an organization of providers who have agreed to share responsibility for the cost and quality of care. By setting limits on total spending at levels designed for cost-effective and affordable health care, the setup motivates coordination of care and reduction of unnecessary treatments, such as duplicate tests. The system is built on rigorous quality measures to ensure that patients get the treatment they need.

A coordinated system of care focused on keeping people healthy is the most effective way to improve quality, maintain access for all Vermonters and control costs – goals we enthusiastically share with state and federal policymakers, and the public.

John Brumsted, MD

The new approach is voluntary and will be run by local providers – doctors, nurses, home care providers, social service workers and others. Health care decisions will still be made by patients working with the providers they choose, and the model does not affect health plan benefits for anyone, including Medicare beneficiaries

John Brumsted, MD, president and CEO of The University of Vermont Health Network and CEO of the UVM Medical Center, cited the approach’s potential to improve health care in Vermont.

“A coordinated system of care focused on keeping people healthy is the most effective way to improve quality, maintain access for all Vermonters and control costs – goals we enthusiastically share with state and federal policymakers, and the public,” he said.

Vermont’s all-payer model will evolve gradually, starting with a limited number of Medicaid patients served by several hospitals and their communities in 2017, and expanding to some Medicare and commercial health plan patients in 2018.