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ACT 48: AN ACT CREATING A UNIVERSAL AND UNIFIED HEALTH CARE SYSTEM- UPDATE 2012 Harry Chen, MD, Commissioner of Health.

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Presentation on theme: "ACT 48: AN ACT CREATING A UNIVERSAL AND UNIFIED HEALTH CARE SYSTEM- UPDATE 2012 Harry Chen, MD, Commissioner of Health."— Presentation transcript:

1 ACT 48: AN ACT CREATING A UNIVERSAL AND UNIFIED HEALTH CARE SYSTEM- UPDATE 2012 Harry Chen, MD, Commissioner of Health

2 Why our health care system is broken  It’s too costly and contains no mechanism for cost control.  It is funded in a manner which is unfair, inefficient and inequitable.  Too many people are uncovered (47,000) and underinsured (160,000)  And it doesn’t provide Vermonters with the best value for the health care dollars we spend.

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4 We spend almost 20 cents of every dollar we earn on health care, more than the national average

5 The Opportunity of Health Care Reform  Cover all Vermonters regardless of age income, or employment status  Preserve quality and patient choice  Separate health care from employment  Lower health care spending  Improve health  Create jobs and economic opportunities

6 Goals  A sustainable budget for health care in Vermont  Achieve and maintain a reasonable rate of growth in overall spending closer to economic growth  Quality maintained or improved and health improved  Changes in health care payment and delivery that are necessary to support these goals

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8 What did Act 48 do?  Green Mountain Care Board  Cost containment  Payment reform  Workforce development  Oversight of almost all aspects of health policy  Vermont Health Benefit Exchange  Reorganizes purchasing of health insurance  Allows many uninsured Vermonters to get tax credits for coverage  Detailed Planning for Green Mountain Care (single payer)  Operational planning  Financing plan

9 H.202 Timeline CMS: Earliest approval of exchange waiver SFY 2013 July 12-June13 Admin delivers Financing Plan to General Assembly Board: draft recommendations on GMC benefits for financing plan Board: approves exchange benefits General Assembly: Enact financing plan Admin: Seek Exchange waiver to establish GMC Green Mountain Care begins (earliest possible) Board sets provider rates & system budgets Board approves insurance rate increases & CON SFY 2014 July 13-June14 General Assembly: Enact GMC budget Board: Proposes GMC budget SFY Possible waiver approval of GMC 2015 or 2017 General Assembly: Enacts legislation creating board, creating Health Insurance Exchange and outlines Green Mountain Care SFY 2011 Jul 10-Jun11 Hsiao report to legislature Administration: Develop medical malpractice proposal Green Mountain Care Board established General Assembly: Pass legislation finalizing implementation and other issues from strategic plan SFY 2012 Jul 11-Jun12 Board: Approve GMC benefit package

10 Health Care Reform Timeline 10

11 Green Mountain Care Board: Who are they? 11 5 members, appointed by the Governor with advice and consent of the Senate  Chairwoman Anya Rader Wallack, Ph.D. of Calais  Al Gobeille, of Shelburne  Karen Hein, M.D. of Jacksonville  Con Hogan of Plainfield  Allan Ramsay, M.D. of Essex Junction

12 5/3/ Data analysis Benefits standards Data analysis Benefits standards Can planning, policy and regulation be coherent and coordinated?

13 More steps along the way …  2014 – Vermont Health Benefit Exchange  Provides new federal tax credits to cover uninsured Vermonters  Administrative structure for the single payer  Upon availability of federal waiver (2017 at latest)  Vermont implements single payer

14 “Health Benefit Exchange” 14  A mechanism for purchasing health insurance  Simplifies shopping – like Expedia  Standardizes insurance options  “Qualifies” health plans  Administers new federal tax credits  Provides guidance and quality ratings to people shopping  If state doesn’t develop, feds will

15 15 Who is eligible to buy insurance in the Exchange?  Open to all citizens and legal immigrants who live in Vermont (except those in prison)  Open to small employers that offer coverage to all full-time employees Small employer = up to 50 employees in 2014; 100 employees in 2016 In 2017, states may choose to include large employers, too.

16 16 What are they buying? Qualified health plans:  Provide “ essential health benefits ”  Are certified by the Exchange as meeting certain standards and requirements  Are offered by Vermont-licensed insurers who agree to offer at least gold and silver level plans

17 17  Uninsured individuals with income under 400% FPL (and no access to an employer plan) are eligible for premium tax credits for enrolling in plans through the Exchange  Tax credit amounts are based on income  Individuals under 250% also receive reductions in cost-sharing (including deductibles and co-pays) Why buy in the Exchange? Tax Credits and Cost-Sharing Subsidies

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19 Why do we need an Exchange ?  Individual tax credits are available only through the Exchange  Funds to design and build the Exchange and revamp our eligibility, enrollment and claims processing for Medicaid to serve a larger population  Reduced complexity of insurance purchasing  Federal limitations on waiver  Potential for single claims processing mechanism 19

20 Exchange Internal Timeline/Activities  Summer-Fall 2012  Finalize outreach & education plan and Navigator Program  Present GMCB with Essential Health Benefits and Plan Design recommendations  Develop scope of work and contract for IT system integrator (SI)  Develop informational Exchange website (shell)  Explore and finalize wellness offerings through Exchange -- offerings and quality measures in line with Healthy Vermonters 2020 and Blueprint for Health  Begin CMS Design Reviews (federal requirements & oversight)  Winter-Spring 2013 o Submit sustainability and transition plans to state legislature o Lay the groundwork for outreach, Navigator program, and internal/external training o SI work ongoing Vermont Health Benefit Exchange

21 HIX Internal Timeline  Summer 2013 o Full-scale launch of outreach campaign o System testing o Train Navigators, call-center staff, state support staff, and grass-roots advocates  October-January 2013 o Open Enrollment on Exchange website o Navigators providing enrollment assistance in the field o Call-center up and running  January 1, 2014 o Exchange health coverage active Vermont Health Benefit Exchange

22 New: Proposed Visual Identity Vermont Health Benefit Exchange The visual identity of the Exchange will be a public face of health reform in Vermont. A range of possible names, taglines, logos, color schemes and images were developed. Then, focus groups of Vermonters – including both individuals and small business owners – were asked to give feedback and discuss their reactions. This is the result.

23 Green Mountain Care (single payer) 23  Occurs after Affordable Care Act waiver and other requirements are met  All Vermonters covered by virtue of residency  Legislative concerns re: in-migration of people for benefits  Penalties for falsifying residency  De-coupled from employment

24 Green Mountain Care (single payer)  Minimum benefits set by board Covered services & cost-sharing Statute provides broad parameters & considerations Must cover broad spectrum of care, with emphasis on prevention Benefit package recommended to the board by AHS Medicare remains intact, as does Medicaid  Choice of providers Vermont networks aren’t very limited usually 24

25 What about the financing?  Report to the legislature in 2013 two financing plans:  one with continued private premiums  one with all public financing  Maximize federal funds and spread costs fairly  Many issues to be resolved:  What will the overall costs/savings be?  How much federal $ will we get?  How do we deal with cross-border issues?  How are public and private coverage integrated?  How do we incorporate self-insured employers? 25

26 December 14, 2011 HEALTH CARE REFORM FINANCING: LISTENING SESSION

27 Listening Session’s Purpose  Legislature Passed Act 48, An Act Relating to a Universal and Unified Health System  Act 48 requires financing plans to be presented in 2013  Public input is important & necessary to inform the financing plans o “The state must ensure public participation in the design, implementation, evaluation, and accountability mechanisms of the health care system.” – ACT 48  Listening sessions provide an opportunity to express preferences for the type of principles and funding sources that will help shape the financing plans due in

28 Organization of the Session  Principles of a Health Care Finance System  What are principles and why are they important?  Discuss in small groups  Express preferences  Potential Funding Sources  Funding generally  Payers and funding sources  Health care expenditures and state revenues  Small group exercise 28

29 Examples of Principles for a Financing System  Example principle: Equity  Revenue system should take into account ability to pay o Example, progressive federal & state income tax  Example principle: Exportability  Taxes should be paid by non-residents when possible o Example, Alaska receives 83% revenue from oil royalties  Example principle: Stability  Relies on a balanced variety of revenue sources o Example, Vermont’s revenue mix is among most balanced in Nation 29

30 Funding Sources: Who Pays Now? Source: BISHCA, JFO, MEPS Data 30

31 Potential Funding for Health Care Financing System  Individuals: beneficiary premiums  Individuals: out of pocket spending for services  General tax on businesses  Payroll tax, both businesses and individuals  Income tax  Property tax  Consumption taxes 31

32 Benefits Listening Sessions May – June 2012 GREEN MOUNTAIN CARE: VERMONT’S HEALTH CARE REFORM

33 Listening Session’s Purpose  Public input is important and necessary to inform the design of the benefits  “The state must ensure public participation in the design, implementation, evaluation, and accountability mechanisms of the health care system.” –ACT 48  Listening sessions provide an opportunity to express preferences that will help shape the benefits for Green Mountain Care 33

34 GMC Benefits: focus for today 34

35 35 Leading Causes of Hospitalization – For Chronic Disease  Leading causes of chronic disease hospitalization:  osteoarthritis  mental health or substance abuse  cardiovascular disease-related  Although osteoarthritis is the leading cause at 4% of all hospitalizations in Vermont:  the 3 rd – 6th highest causes are related to cardiovascular disease & together, make up 9% of all hospitalizations.  Mental health and substance abuse is indicated as the cause of 3% of hospitalizations Hospital Discharge Data Cardiovascular disease-related = 9%

36 36 Chronic Disease Prevalence 2010 BRFSS  Arthritis is the most common chronic disease in Vermont, followed closely by hypertension.  Asthma impacts approximately 1in 10 Vermonters.  Slightly fewer Vermonters have CVD, diabetes, or cancer. COPD effects 3% of the adult population.

37 Coverage and Cost are Connected  In a universal system, everyone is covered and everyone pays into the system  What are our priorities as a community? How do we decide what care to pay for?  While ensuring people get what they need  Promoting health and wellness 37

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40 Shift the Emphasis of Care  In the US health care system there is not enough focus on and utilization of preventative medicine and chronic disease management, which improve health outcomes and curb escalating health costs  Studies have shown that prevention can:  prevent chronic diseases (such as type II diabetes)  Chronic disease management can:  prevent avoidable Emergency Dept visits,  improve outcomes,  prevent the need for invasive surgeries,  and save lives 40

41 Factors Influencing Health Status 41 Adapted from Schroeder, SA. We can do better-Improving the health of the American people. NEJM 2007;357:1221-8

42 Act 171: 2012 Health Reform Bill  Insurance market reforms compliant with the federal Affordable Care Act  Integration of Medicaid with the Exchange: Global Commitment, Dual-Eligibles, and other waivers  Creation of a viable and dynamic exchange that supports Vermont's health care reform goals  Refinement of the functions of the Green Mountain Care Board- CON, hospital budgets, rate review  Malpractice Reform

43 Exchange/Insurance Compliance with ACA  Employers in the Vermont Health Benefit Exchange  2014: 50 or fewer  2016: 100 or fewer  Allows bronze plans and dental plans to be sold with QHPs. Merges individual and small group  Provides parameters about Navigators and Brokers  GMCB must approve a full range of cost-sharing structures in the Exchange for each actuarial value and allow insurers to offer wellness rewards and discounts  “

44 Malpractice Reform Certificate of Merit Pre-suit mediation Medical malpractice reform report 44 Begins Feb. 2013

45 Health Reform: Building on a Strong Base  Blueprint for Health  Vermont Information Technology Leaders  Medicaid Global Commitment Waiver  Coverage Expansion  “MCO Investments”  Federally Qualified Health Centers

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47 Practices and Populations with Access to Team-Based Services Thru June 2012

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49 49 Current Payment Systems Do Not Support High Quality Cost Effective Patient Care  Volume based – (FFS, DRG’s, Per diems)  Encourages visits and procedures  Does not encourage efficiency, quality, coordination or value.  New payment methods must be balanced to address utilization, cost, quality and patient experience (value)

50 The Vermont Blueprint for Health Central to Payment and Delivery System Reform Success of all depends on primary care capacity, quality and coordination BLUEPRINT FOR HEALTH

51 Payment reform goals

52 52 Shared Interests: PCPs, Specialists, Hospitals, Community-Based Services  Intense Focus on high risk/high cost patients  Better coordination of care  Mental Health and Substance Abuse Services, Home Health, SNFs/NHs  Four dimensions of performance (balanced)  Reduce growth of total cost of care  Reduce avoidable utilization  Improve adherence to standards of care (condition specific)  Measure patient experience

53 What about Washington?  Supreme Court Decision  Individual mandate survived as a tax.  Medicaid expansion is optional.  Are we done with court challenges?  2012 Elections  Congress could repeal ACA.  New President could ???  ACA Waiver for Green Mountain Care  2017 is earliest date in law.  Anything sooner would require legislation.

54 The Logic of Health Reform: Where is Population Health?

55 The Best Opportunity To Maximize Health Leverage the Far Larger Personal Health System to Achieve Population Health Goals NOT TO SCALE

56 Increasing Individual Effort Required Increasing Population Impact Source: Adapted from Frieden TR. A Framework for Public Health Action: The Health Impact Pyramid. Am J Pub Health. 2010;100(4): Opportunities for Public Health

57 The finish line  Health care is a right – all Vermonters are covered  Health care costs are sustainable – closer to our rate of economic growth  Providers are paid fairly  Everybody pays their fair share  Vermont is the best place to do business  Vermont is the best place to practice medicine  Vermont is the healthiest place to live

58 Summary  Act 48 creates a responsible plan for health care reform that includes opportunities for Vermonters to participate. We are making progress toward that goal.  Without reform, costs will grow faster and system will continue to erode.  With reform, we can cover all Vermonters, achieve substantial cost savings and improve overall health.

59 — Dr. Martin Luther King Jr., 1966 "Of all the forms of inequality, injustice in health care is the most shocking and inhumane."


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