Title: Catamount Health and Health Care Reform in Vermont
1Catamount Health and Health Care Reform in Vermont
Kenneth E. ThorpeEmory University
2Context for Reform
- High and Rising Cost of Health Care--Growth in
Vermont has exceeded the national average - Without reform, the rise in health care costs
will absorb 25 of the total growth in payroll
over the next 5 years. - Approximately 10 percent of Vermonters 65,000
remain uninsured. - We face gaps in the quality and safety of health
care in the state - Vermonters receive approximately 60 to 70 percent
of clinically recommended health care (e.g. only
half of Vermont diabetics routinely monitor their
blood glucose).
3Context for Health Care Reform in Vermont
- To address these problems health care reform must
transcend a simple debate over insurance! - Reform must by SYSTEMIC, impact all Vermonters
and address - The high and rising cost of health care
- Gap between ideal and actual practice of care,
particularly among the chronically ill - The uninsured
4Context for Health Care Reform Key Facts
- About 80 percent of healthcare spending in
Vermont is traced to patients with a chronic
health condition. This is not an insurance issue
it is a care management, delivery system and
payment issue. - 2. Chronically ill patients in the state do not
receive all, or in many cases most, clinically
recommended care. This includes patients in the
single payer Medicare program, those with private
insurance, Medicaid and the uninsured. This
increases costs and produces substandard medical
outcomes.
5Context for Reform Key Facts of What Really Is
Driving the Rise in Healthcare Spending
- 3. Two-thirds of the rise in the cost of private
health insurance is traced to a rise in the share
of adults and kids treated for chronic illness
and innovations in medical treatmentlargely new
drugs. - 4. About 30 percent of the rise in spending is
associated with the rise in obesity prevalence
over the past 15-20 years
6The urban (and rural)-myth of hospital-
generated increases in health care spending
Health Spending VERMONT VERMONT VERMONT
Health Spending 1980 1990 2000
Hospital 45 38.8 34.9
Physician 20 24.0 25.0
Prescription Drugs 5.7 7.6 11.0
7Continued Dramatic Declines in Hospital Occupancy
Rates Associated with Changing Technology and
Patient Characteristics, Vermont and US, 1970-2003
8Trends in Hospital Capacity, US and Vermont
1970-2003 Beds per 1,000 Resident Population
Impact of Technology and the Rise in Chronic
Illness Continues to Reduce the Overall Share of
Hospital Spending
9Context for ReformAligning Reform with the
Underlying Problems in the System
- Systemic reform of Vermonts health care will
require - A major focus on the chronically ill that account
for 80 percent of health care spending and most
of the growth in spending - A redesigned delivery system to improve quality
and outcomes - Changes in the way physicians are paid to care
for patients
10Context for Reform
- Systemic reform will require
- Efforts to reduce administrative complexity and
reduce excess clinical spending - Investments in information technology, patient
safety and error reduction - Major expansions of coverage with universal
insurance the ultimate target
11Catamount Health
- Will
- Enroll uninsured and eligible VHAP adults,
Medicaid and Dr. Dynasaur children - Provide the ability to purchase comprehensive,
affordable health insurance for all uninsured
Vermonters. Premiums reduced by up to 90. - Have low administrative costsabout 4.
- Improve the quality of care delivered to all
chronically ill patients, and improve the value
of care purchased - Reduce the administrative burdens facing
physicians - Lower health insurance premiums paid by workers
and employers by 4 to 6 percent when the plan is
fully implemented by reducing the cost shift, and
reducing administrative costs and additional
spending linked to medical errors and events.
12Impacts of Catamount Health
- Will reduce the level and growth in health care
spending - Through statewide use of the chronic care model
for all Vermonters - Through reduction in the existing cost shift
built into premiums - Through simplified administration and lower
administrative costs - Common claims forms
- Health information technology initiative (health
record) - Electronic billing
- Administrative costs of Catamount health about
4!
13Catamount Health
- Combination of VHAP policies and Catamount health
initially enroll about 20,000 uninsured - Lowers private health insurance spending through
use of chronic care management, reduction in
medical errors, administrative costs and
reduction in cost shift
14Catamount Health
- Places Vermont as the national leader in
treatment of chronic disease through an
innovative new delivery model, lower
administrative and clinical costs. Improves the
value of the dollar spent on health care.
Provides the state a clear market advantage in
attracting and retaining business. - Provides business community short and long term
answer to high and rising health care spending. - Places Vermont as the national leader in focus on
population health, primary and preventive care
15Private Insurance Spending (Millions of Dollars),
Currently Insured Reform vs. No ReformSpending
Falls by 550 Million Over the Next Ten Years.
16Financing Choices
- Total spending on Catamount health and the
Governors plan are similar. - Approaches for financing the costs of the two
proposals differ however. - The Governors plan is financed by increasing
employer spending on health care by 45 to 50
million. - Catamount health is funded primarily by the
federal government and the GC.
17Conclusions
- Catamount health builds on and expands the
governors chronic care initiative. We cannot
control the growth in spending without a focus on
chronic illness and population health
initiatives, period. - It assures the chronic care infrastructure will
be available to all chronically ill patients in
the state, not just the privately insured - It reduces administrative and clinical costs.
- It reduces substantially the number of uninsured
in the state and provides them affordable
comprehensive insurance - It generates about 550 million in savings to
employers and insured working families over the
next ten years - It will improve the quality of care, and provide
better value for each health care dollar spent.