OneCare Vermont

The Vermont State House, in Montpelier, the nation’s smallest state capital.

VTDigger reports that the federal government and Vermont have drafted a preliminary agreement to implement an “all-payer” healthcare payment system.

Under the model, payments to physicians from commercial insurers, Medicare and Medicaid would be based on monthly fees instead of  fee-for-service. Physicians would operate under an Accountable Care Organization — either OneCare Vermont or Vermont Care Organization — which would accept the payments. The ACO would then pay physicians based on quality of care.

The deal would make Vermont the first state to implement an all-payer system for all providers. Maryland now has the only U.S. all-payer system, but  just for hospital services.

The Vermont model aims to keep certain costs paid by Medicare, Medicaid and commercial insurance from growing more than 3.5 percent a year for five years,  starting in 2018.

The state aims to have about 30 percent of primary-care providers under the model by Jan. 1, 2018, with 80 percent  over a five-year period. If OneCare ACO decides to join the all-payer model, the state would reach the initial 30 percent goal.

The Green Mountain Care Board would regulate the ACO. Gov. Peter Shumlin said the all-payer model could save Vermont about $10 billion over  10 years.

To read the VTDigger story, please hit this link.