MONTPELIER — A bipartisan group of House members are pushing a new proposal to move the state away from Vermont Health Connect, but the consequences remain unclear if the state were to adopt the proposal.
On Thursday, Reps. Patti Komline, R-Dorset, Heidi Scheuermann, R-Stowe, Jim Condon D-Colchester, and Adam Greshin, I-Warren, called for the state to transition from Vermont Health Connect to a Supported State-Based Marketplace Exchange. Oregon and Nevada have adopted the hybrid state-federal model after their state-based exchanges faced significant problems.
Vermont’s exchange, which also experienced significant tech challenges and is still not fully functional, allows some individuals to sign up for insurance plans through the website. But other individuals and all small businesses are enrolling through a paper process. And users cannot currently make changes to their information online in an automated way.
Rep. Patti Komline
Komline said by adopting the model used by other states the state could shed its IT woes while maintaining control of the plans offered, and without losing the ability to provide federal and state subsidies to help make insurance more affordable to Vermont residents.
“We can control the plans that we’re offering, but when it comes to handling the IT, we can call on healthcare.gov to do that,” she said. “The transition costs for Oregon was $7 million. They were able to use the grant money from the feds. It took them six months to make that transition and so far it’s gone very smoothly for them.”
“It’s a viable alternative. We’re not just playing political games with it, but it’s something that we can really do,” Komline added.
Condon said his goal is to provide Vermonters with a fully functioning insurance marketplace.
“Vermonters deserve a functioning insurance portal. They don’t have that yet, but citizens deserve the ability to be able to go online and get their business done and take care of this. It’s just not happening as well as it should be,” he said. “My own personal opinion is that we should have gone the fed way to begin with. I think it would have saved a lot of hassles.”
The federal government is not charging Oregon and Nevada, at least for 2015, for the use of the federal site. But, it could begin charging them 3.5 percent of the cost of premiums as it does for other states that fully use the federal exchange. With Vermont’s $200 million in premium spending, that would mean a $7 million tax for Vermonters in total.
Previous opposition to moving to the federal exchange included the likely scenario that Vermont would not longer be able to provide state-level subsidies, among other reasons. Massachusetts is the only other state to do so, and it is not clear if CMS would allow that to continue.
“A key point is that we keep our subsidies with this,” Komline told reporters Thursday. “The officials in Oregon and New Mexico and in Nevada are all saying that they’re covered. That they’re subsidies are fully covered.
But the Centers for Medicaid and Medicare, which oversees state and federal exchanges, has never before considered whether a state could continue to provide state-level subsidies through the hybrid model.
The state expects to spend about $8 million this year on operating the portion of Vermont Health Connect that deals with exchange plans. That cost would be gone under the proposal released Thursday, according to Komline.
But their plan does not address Medicaid, which also flows through the state exchange. Komline said the state’s Medicaid program would continue to be run by the state. Lawrence Miller, Gov. Peter Shumlin’s chief of health care reform, said Vermont Health Connect would continue to be needed and built out in order for the state to effectively manage the Medicaid program.
There would still be a savings to the state, Komline insisted.
And Scheuermann said state officials would work with the federal government to answer questions that remain unknown.
“These are the questions that we do want answered and we want to work with. But this is relatively new,” Scheuermann said. “We want to work with the feds to do that, both with regard to Medicaid and with regard to the state subsidies.”
Miller acknowledged Thursday that Vermont Health Connect’s “current operations are unacceptable.” But he said many of the functions needed for the state’s Medicaid program are also needed for the part of the exchange the proposal revealed Thursday would jettison to the federal site.
“It’s a viable alternative to the qualified health plan component. The concern, of course, is that Vermont Health Connect is also the Medicaid eligibility and enrollment engine,” Miller said. “It’s a question of how to accomplish multiple goals most effectively. It certainly address the qualified health plan issue, but the exchange is primarily, by volume and users, Medicaid eligibility and enrollment.”
Miller said the administration has already engaged with CMS in discussions of several options and will continue to explore the best path forward for the state.
“We’ve discussed everything with CMS. Nobody’s particular happy with where we are,” he said.
The legislation proposed Thursday calls for the administration to have a transition plan ready by March 31. Miller said the administration will be prepared to offer a formal response if the bill advances.
“We’re not waiting for the Legislature to make a decision about this. If this is passed we would have begun our groundwork well before,” he said.
The so-called change of circumstance function that is still not part of the exchange, which would allow automated changes to be made by users, is on track to be completed in April, according to Miller. He said the state will continue to ask its contractor, Optum, to complete that work. Other recent deadlines have been met by the company, he said.
“I would support continuing to complete the change of circumstance functionality because we need that for the Medicaid … eligibility, anyway. It’s not something we can just stop doing. We don’t have another way of doing Medicaid enrollment or redetermination. That is the path,” Miller said.
Read the proposed legislation below: