Vermont developing plan for running dual health programs for elderly poor

05/29/09 1:22PM By Ross Sneyd
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(Host) Even as Congress and the White House draft a national health reform plan, Vermont and six other states will try to fix a key area of the system on their own.

The states have been recruited to come up with a plan for running the federal government's two big health care entitlement programs themselves.

VPR's Ross Sneyd has more.

(Sneyd) The programs are Medicaid and Medicare.

They were signed into law in 1965, at the height of President Lyndon Johnson's "war on poverty."

Medicaid serves the poor. It's run jointly by each state in partnership with the federal government.

Medicare is for the elderly and it's the sole responsibility of the federal government.

Some elderly poor are covered by both systems. But their needs are sometimes lost in the tension between the federal and state regulators who run the programs.

Patrick Flood of Vermont's Human Service Agency explains.

(Flood) "So it's very confusing sometimes for certainly the person, the individual who's in both programs, what they're eligible for, what pays for what. But it's also difficult for the providers, a doctor, for example, who has to figure out what to bill, what to bill to Medicare, what to bill to Medicaid, etc."

(Sneyd) So Vermont and six other states will spend the next year or so devising a way to take care of all the people who are eligible for Medicare and Medicaid in a single system. It would be administered by each state.

Flood says it would give Vermont flexibility to relax some of the arcane rules. If a person needed care, he or she would get it. And the combined Medicare-Medicaid system would pay for it.

Flood says this initiative is a key part of the national health reform debate.

(Flood) "Anybody who's interested in health care reform, from the governor right down to the doctors, knows that to get real health care reform, we need to have more control over the Medicare expenditures."

(Sneyd) Many in the medical community think it makes sense to merge Medicaid and Medicare for patients who are both poor and elderly.

That's because, although they make up just 18 percent of Medicaid beneficiaries, they account for 46 percent of the costs.

But Paul Harrington of the Vermont Medical Society says that's also what gives doctors pause. The Douglas administration has proposed a 20 percent cut in what it pays physicians for Medicaid patients.

(Harrington) "So it's going to be hard to work with the Douglas administration on an approved care model for these patients while simultaneously they're seeking to cut the payment for these patients who typically have multiple chronic conditions and require a large amount of care. So the left hand doesn't really seem to know what the right hand is doing here."

(Sneyd) Still, Harrington says doctors will work with the state on the pilot project because it holds real promise.

The state says it'll probably take at least a year to come up with a proposal. It might be two years before it could be put into place.

For VPR News, I'm Ross Sneyd.


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