BCBS to step back from Vt. health reform effort

MONTPELIER, Vt. (WCAX) - Vermont health care reform efforts have hit a major hurdle after Blue Cross Blue Shield, the state’s largest private health insurance company, has said it will not work with the organization implementing the state’s all-payer model.

BCBS officials say they’re stepping back from OneCare, the state’s accountable care organization, in the interest of their customers. They cite concerns including a lack of tangible health outcomes, an inability to bring down costs, and problems with data security and privacy.

“They want to see a bending of the cost curve, they want more affordability, they’d like to have their access to their doctors. And so we weren’t able to show those things to our customers and employers that are purchasing insurance,” said BCBS’ Sara Teachout.

Right now, about 250,000 Vermonters are part of the all-payer model -- 54,000 on Blue Cross Blue Shield, 68,000 on Medicare, and 125,000 on Medicaid.

OneCare’s Vicki Loner says BCBS’s announcement caught them flat-footed. “We’ve been relying on insurance companies for decades now and I haven’t seen any evidence that they have been able to improve health care quality and control costs,” she said.

OneCare is the lynchpin to the reform experiment sparked by the Affordable Care Act, where money from Medicaid, Medicare, and private insurance companies like BCBS is pooled. The money then passes through OneCare and is paid in flat rates to providers who sign on with the all-payer model, an attempt to reward outcomes rather than pay for each service.

OneCare has already been under the microscope, facing criticism and questions about transparency, accountability, and whether it improving health outcomes while cutting costs. BCBS pulling out means the doctors who serve those 54,000 Vermonters will no longer be part of the reform experiment.

“It’s been a number of years and I think we all wished that we would be further along in our health reform journey,” Teachout said.

“I think it’s unfortunate that the negotiations fell through,” said Gov. Phil Scott, whose administration has championed the reform efforts.

Scotts says BCBS stepping back does not jeopardize the overall effort, adding that it’s an opportunity for everyone to reset the reform conversation. “We’ll do our part and we need everyone to do their part. We need the Legislature to get involved, the Green Mountain Care Board, the hospitals, the insurance companies -- all of us need to pull in the same direction.”

Loner agrees that the reform project is overdue for a fresh start and a need for all the players to come to the table. “There is a fundamental misunderstanding, misinterpretation of what the role is of an accountable care organization (ACO) compared to the role of the state and federal government and insurance companies, and that needs to get worked out,” she said.

BCBS’ announcement comes just a few weeks after state regulators and the federal government extended the all-payer agreement and a day before state regulators are set to vote on OneCare’s budget.

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