Vermont has received tentative approval from the Obama administration to establish an all-payer reimbursement system for healthcare providers in the state starting in January.
Maryland has long had an all-payer system, but it covers only hospitals. Vermont plans to use an accountable care organization-type structure that would cover all providers. All-payer systems require all insurers, whether private or governmental, to pay similar rates for services.
Vermont says its goal is to provide higher-quality care and reduce cost growth. “I'm incredibly optimistic that we can move to (an) outcomes-based payment system with cooperation from the federal government that will allow us to contain costs and to put money in Vermonters' pockets,” Vermont's Democratic Gov. Peter Shumlin said.
The approval of Vermont's Section 1115 waiver request comes nearly three weeks after Shumlin traveled to Washington to negotiate a deal with HHS Secretary Sylvia Mathews Burwell.
Under the proposal, modeled on Medicare ACOs, providers would be paid global rates determined by patient populations and health outcomes. Fee-for-service payments would be scrapped. Some experts say more states should consider such a system to speed the shift to value-based payment.
Vermont's demonstration waiver is being reviewed by HHS and the state, according to Robin Lunge, Vermont's director of healthcare reform. If finalized, the five-year demo would begin Jan. 1, 2017, and end Dec. 31, 2021.
