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Sunday, July 24, 2011

Moving Towards a Single Payer in Vermont

If you're interested in Vermont's plan for a single payer system, you'll want to look at an article in this week's New England Journal of Medicine.

According to Anya Rader Wallack, Ph.D., special assistant for health reform to Governor Shumlin, the Vermont program will include "a global budget for health care expenditures, guaranteed coverage that is not linked to employment, and a single system of provider payments and administrative rules."

The health system will be overseen by a new public entity - the Green Mountain Care Board. Here's how Dr. Wallack describes the powers of the board:
The board can wield traditional tools such as fee-for-service rate setting, controls on the acquisition of technology, and reviews of both health insurers’ rates and hospitals’ budgets. However, the law also provides explicit direction to the board to create a global budget for health care spending and develop new payment models that create incentives for providers to stay within the budget.... The board is charged with implementing payment methods that encourage high quality and efficiency and provide the impetus for fundamental changes in the structure of the delivery system. It will apply these methods across all payers, private and public (we will seek permission from the federal government to include Medicare), and will monitor the effects of payment changes on both cost growth and quality indicators. (emphasis added)
The beleaguered Independent Payment Advisory Board (IPAB), created by the federal health reform law, has much less power than the Green Mountain Care Board, but it's under attack as a socialist monstrosity. It's at best touch and go as to whether the IPAB will ever see the light of day.

Our federal paralysis is why states are the most important laboratories for health reform in the U.S.

Vermont is small (625,000), by U.S. standards has a remarkably civilized form of political debate, is the first state to allow same-sex civil unions, and has the only "out" socialist legislator in Washington - Senator Bernie Sanders. It's hardly typical of the current U.S. mainstream.

But Saskatchewan wasn't typical of Canada in 1946, when it passed the first provincial single payer legislation in Canada. It took 38 years to move from the Saskatchewan Hospitalization Act to the Canadian Health Act in 1984. It's easy to pontificate about ethics and policy, but change on the ground takes a long time, huge amounts of work, an iterative political process, and a public learning curve.

A lot of the future of the U.S. health system is riding on the Vermont experiment. If Vermont succeeds, open-minded conservatives (despite what we're currently seeing in debt limit "debate," they do exist!) will kick the tires of Green Mountain Care and conclude that a single payer system doesn't destroy health and human liberty. Vermont represents only 0.2% of the U.S. population, but it may turn out to be the mouse that roared for health system change!

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