3-8-16 – Any Way You Slice It, Healthcare Reform Is A Mess

by Matthew Strong

In his press conference about the Medicare “waiver” in January, Governor Shumlin said “we really are inventing a new way to pay for health care.” Apparently, there has been a lot of “inventing” over the past five years.

Shumlin signed H. 202 into law in May, 2011, the first single-payer legislation in the country. It was supposed to save Vermont $500 million in the first year of single-payer implementation. Former Governor Howard Dean (and former physician) had high praise; “There’s a lot of smart things the governor’s doing,” Dean said. “The smartest thing of all is that he’s saying, ‘We’re not going to come up with funding mechanism until we change the payment system.’” The following events have unfortunately proved Dean wrong.

  • Vermont Health Connect was and still is a disaster.
  • They had to fire the development vendor, CGI.
  • The cost for the exchange is approaching $300 million.
  • Shumlin stalled on releasing his single payer plans, Cynthia Browning (a representative in his own party) sued him to release information about it.
  • Jonathan Gruber was scandalous… enough said.
  • Shumlin ultimately had to kill the single payer plan.
  • Dartmouth-Hitchcock Hospital has now sued the state of Vermont over Medicaid payment policy.
  • 48.5% of Vermont’s population is now on Medicare or Medicaid (186,000 on Medicaid, 117,000 on Medicare), both of which dramatically underpay doctors and hospitals. In 2016 Medicare is budgeted to underpay by $190,902,198, and Medicaid is budgeted to underpay by $176,505,430. This data is found on Page 9 of GMCB’s own annual report.
  • The third party biller for Vermont Health Connect (located in Nebraska), which has caused so much trouble for Vermonters, was sold to a larger multi-national company, and no one knew about it until a House Committee meeting in February.
  • On March 1st, the Supreme Court sided against the GMCB in a blow to their long held plans for healthcare data collection from self-insured companies (companies who provide employees in-house health care coverage). Taking a suit all the way to the Supreme Court undoubtedly cost Vermont taxpayers a pretty penny. “Self-insured companies account for the largest number of Vermonters who pay for doctor visits with commercial insurance.” Many companies were already voluntarily submitting claim data and now are safe if they choose not to continue. The lawsuit was over 137 employee’s healthcare data.

Now, Shumlin and the Green Mountain Care Board (GMCB) have set their sights on a waiver from Medicare to “invent a new way to pay for health care.” After the debacle with Vermont Health Connect, which is far from over, the disjointed approach to the Medicare waiver is not inspiring confidence.

  • February, 2014 – Even though the GMCB knew Medicare and Medicaid were the lynch pins of the yet-to-be-halted single-payer plan, no one had actual conversations with CMS (the federal organization who oversees Medicare and Medicaid) about it. Since the “all-payer waiver” is the next best thing to their failed single-payer plans, those conversations would still be meaningful, even though they could not be implemented until Jan 1, 2017 due to Obamacare timetables.
  • December 2014 – Al Gobeille quoted by VPR, saying he is optimistic Vermont will be granted the waiver, and that they plan to keep the cost of growth to less than 3% per year.
  • June 2015 – Shumlin says “Officials with CMS will visit Vermont in the next couple of weeks to work with state officials on its application (for the Medicare waiver). …Shumlin said his administration will have the document completed by the end of June, and the state should have an idea this fall whether the project is feasible.”
  • June 2015 – Gobeille tells Vermont Watchdog “The Board (GMCB) has “not told the federal government anything we would do yet,”’ regarding details of the terms of the waiver in response to concerns about rationed care.
  • September 2015 – VT Digger article “For months state officials have said they are close to knowing what terms the federal government would impose for the leeway to operate an all encompassing all-payer model in Vermont. Richard Slusky (Director of Payment Reform GMCB) said Tuesday he “expects it will be several more months before the state has an answer.””
  • September 2015 – Slusky, quoted in the Burlington Free Press; “No one knows what will happen to ACOs when federal funding expires in 2016. Vermont hopes to combine the state’s three remaining ACOs and incorporate the ACO structure into a Medicare all-payer waiver, said Richard Slusky, director of reform at the Green Mountain Care Board. The state hopes to receive approval of the waiver from the federal government by the end of the fall, Slusky said.”
  • November 2015 – VT Digger: “Al Gobeille, the chair of the GMCB, told the House Health Care Committee on Monday that he expects to have the terms for an all-payer model agreement with the federal government in December. Once the state has the contract terms sheet, Gobeille said his staff would work with key individuals in the industry to set up a more complete all-payer model by May 2016. The all-payer system could then be implemented by Jan. 1, 2017.
  • January 13, 2016 – VT Digger article “Al Gobeille said the Green Mountain Care Board is still “very close” to a deal with the U.S. Centers for Medicare and Medicaid Services to set up an all-payer system. In December, he had planned to present a “terms sheet” or agreement describing the deal in the first two weeks of this month (January). By November, the state of Vermont and the Centers for Medicare and Medicaid Services had agreed on the first term for the deal: that Vermont should limit health care spending growth to 3.5 percent per year for non-Medicare patients. On a cumulative basis, that means such spending would grow by about 36 percent over the next 10 years; without that kind of cap, Gobeille said, health care costs are likely to double.”
  • January 25, 2016 – First lines from Vermont All-Payer Model Term Sheet – “Note: This term sheet contains general concepts and proposed principles, but does not constitute a commitment by any party to undertake any particular action. This term sheet is subject to change, and both the State and CMS acknowledge that any agreement arising from the terms discussed herein is subject to the approval of relevant federal and state officials.”
  • January 25, 2016 – Seven Days Article – “Monday’s briefing, featuring Gov. Peter Shumlin and Al Gobeille, chair of the Green Mountain Care Board, coincided with the state’s submission of preliminary terms and conditions for the waiver from federal regulations that Vermont seeks. The board, the Shumlin administration, and the Centers for Medicare and Medicaid Services have been talking about the so-called “all-payer waiver” for a year. The target to start operating under the new system is next January, which would require an agreement by late spring.”
  • January 25, 2016 – VT Press Bureau article – “Vermont has taken the first step toward a radical change in the way health care providers are paid for their services. On Monday, state officials submitted a proposal to the federal government that would see doctors paid for the health outcomes of their patients, rather than for the services they provide.”

Has the Shumlin administration and the GMCB just started the process with CMS, or are they almost done? Will CMS grant Shumlin and the GMCB the authority to turn Vermont’s healthcare payment system upside down? Will it be done in time to implement within the next 10 months (January 1, 2017)? What happens when there is a new Governor and Speaker of the House in November? Is this rush healthy for any part of our healthcare system or its patients? These are hard questions every Vermonter should be asking.

{ 4 comments… read them below or add one }

Anne Audette March 8, 2016 at 6:37 pm

What does the Vermont AARP think about this?


Katherine Silta March 8, 2016 at 7:22 pm

Good article and the public needs to wake up and smell the coffee as they say.


Mark Donka March 8, 2016 at 7:50 pm

As has been the case in Montpelier for the last 6 years, the public has not been informed as to what it happening with the supposed”Healthcare Reform”. For a administration that has promised transparency we have been kept in the dark by the Democrats super majority. It is time we the people had a say as to what is happening in Montpelier and not just fed sound bites on what they are allegedly doing.
We have that power,it is in the voting booth lets take control of our future and our Children’s future in November.


Clayton Kip March 8, 2016 at 9:29 pm

I opted to pay the penalty until this whole disaster collapsed under it’s own weight. I’m relatively healthy other than cataract surgery last year which I saved up for and paid out of pocket before the procedure. Seems my ophthalmologist really liked pre-pay, cash in hand no 60-90 day wait for his money. Plus the procedure wouldn’t have exceeded my co-pay. Who is really the stupid one here Mr. Gruber?


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