VT – ACO Pilot Project Announced

February 2017 ~

On February 8, Governor Phil Scott and Human Services Secretary Al Gobeille, joined by several doctors and health care providers, announced a pilot Medicaid program intended to change the current fee-for-service system.

Designed to provide better care, better health and lower costs for consumers as well as the State, Vermont has entered into a one year agreement with OneCare to launch an accountable care organization (ACO) pilot program serving 30,000 Medicaid beneficiaries.

Governor Scott says the program is another step in his efforts to reduce health care costs and save Vermonters money while improving care.  “Last year the state put out a Request for Proposal to accountable care organizations to pilot a payment model that makes advance payments for Medicaid patients. As a result we have now entered into a one year agreement with OneCare. As an Accountable Care Organization OneCare will contract with the Department of Vermont Health Access, or DVHA, to provide services to 30,000 Medicaid beneficiaries on a perspective payment schedule. This agreement allows us to gauge the impacts of an all-payer model designed to reward value, meaning low cost and high quality care, rather than volume under a one year pilot program.”

The ACO will receive prospective rather than fee-for-service payments. Four hospitals, federally qualified health centers, independent practices, skilled nursing agencies, and home health providers will work with the state on the pilot.

The pilot program could determine whether the state adopts an all-payer system, in which health care providers are paid based on the quality of care they provide rather than the quantity of services. If the pilot meets its goal to save $93 million by the end of the year, the state will expand the initiative.

Gobeille said that while ACOs have been operating in the state for some time, this pilot project marks the first time one has agreed to risk losing money if it fails to provide care within the limits set by the program.

“At the end of this pilot, if it’s effective, we’ll expand it,” Governor Scott said at a press conference. “If it’s not meeting these goals and we cannot address operational concerns, we will not move forward.”

In addition to changing the way care is paid for, the new system encourages health care providers to work with patients on a regular basis to stay healthy.

“It will allow providers to dedicate more time and energy to patients by eliminating some of the time doctors and administrators spend on claims,” stated Governor Scott.

The program’s rollout will be slow, according to officials, with a plan to be active in approximately 40% of care services by the program’s second year and hit about 70% by year six. If successful, the program’s designers are confident that it could become a national model for similar payment reform.

Source(s): WAMC, February 2017; GMC Board, February 2017; Rutland Herald, February 2017;