Federal officials have selected Vermont as one of three states to participate in the AHEAD program, a new health care reform initiative, the state announced Tuesday.
It’s not clear exactly what the effort will mean for Vermont, as state and federal governments have yet to finalize the details of the program.
But AHEAD, which stands for “State Advancing All-Payer Health Equity Approaches and Development,” aims to reduce health care costs, increase investment in primary health care and change the way hospitals are reimbursed for the care they provide.
Vermont Department of Human Services Commissioner Jenny Samuelson welcomed the development in a press release Tuesday. The decision to choose Vermont is an acknowledgement of “the department’s efforts to advance new flexible payment and delivery approaches that make health care more affordable, accessible and high-quality for Vermonters, hospitals and primary care providers,” Samuelson said.
The federal government has also selected the states of Connecticut and Maryland to participate in the model. Participating states will be eligible to receive up to $12 million in federal funding to implement the program.
Vermont officials say it will be a rare opportunity to negotiate with the federal government over how the state spends its Medicare funds. About a quarter of the state’s population gets health insurance through Medicare, but the funding comes with strict strings attached.
Vermont hospitals that join AHEAD will also change the way they are paid for providing care. Hospitals are not required to participate, but Vermont must have at least one participating hospital to be part of the program.
For certain programs or patient populations, such as Medicaid patients, hospitals would receive a recurring payment of a predetermined amount rather than billing a separate amount for each individual procedure.
The goal is to provide hospitals with a steady source of revenue and discourage unnecessary procedures.
“The (federal Centers for Medicare & Medicaid Services) selecting Vermont to begin the detailed process of negotiating and structuring an AHEAD model agreement is an important step in determining whether the program is well-suited to support the delivery of high-quality, equitable care to patients,” Sunny Eapen, president and CEO of the University of Vermont Health Network, said in a press release.
Eapen wrote letters in support of the AHEAD model, as did Judy Fox, president and CEO of Rutland Regional Medical Center, but those letters are not binding and the hospital has not yet formally agreed to participate.
AHEAD also would direct more funding to participating primary care clinics and require Vermont to develop a “health equity plan” to reduce health care disparities across the state, subject to program standards.
According to a program fact sheet, the investments in primary care aim to “increase overall capacity for care coordination and connection to community resources, improve quality, deliver patient-centered care, and minimize burden on health care providers.”
If Vermont decides to move forward with AHEAD, the program would begin in 2026 and run through 2034.