Lawmakers, regulators debate how to strengthen primary care without weakening hospitals

At a joint meeting of the Vermont Senate Health and Welfare and House Healthcare committees, lawmakers and regulators discussed how to expand community-based primary care while keeping hospitals financially sustainable after presentations from the Milbank Foundation and Dartmouth researcher Elliot Fisher.

Committee members said the state’s long-standing Blueprint for Health and payment reforms such as all-payer and ACO-based population payments could support primary care delivery — if the state can trace and, when needed, condition how funds flow from payers through hospitals and provider systems to the clinicians who deliver care.

Why it matters: Primary care is central to cost, access and quality. Committee members and presenters warned that without clearer accountability for where primary care dollars end up, policy changes intended to shift care into the community may fail to produce the promised improvements in access or affordability.

Elliot Fisher of Dartmouth, who presented with the Milbank Foundation, said states must design payments so the dollars reach practices. “You have to think about how the money flows to the practice preferably attached to a patient,” Fisher said. He urged a community-based approach that keeps primary care organized around geographic catchments and explicit funding tied to patients.

Owen Foster, chair of the Green Mountain Care Board, said the board has tried to track where population health management and ACO payments end up. “When the ACO back to the hospital, did the money at the hospital get to the primary care providers? Did it go to support primary care? And, the truth is we weren't able to get that level of granularity and we required it as a board condition to certify that the money was actually getting the primary care,” Foster said, summarizing regulatory limits the board has encountered.

Board members and presenters described two different channels of funding: (1) targeted payments tied to Blueprint or ACO initiatives, which the state or AHS can and does track more closely; and (2) general hospital rate increases and facility budgets, where the board typically approves aggregate budgets but does not direct how hospitals internally allocate funds across clinical services. A Green Mountain Care Board speaker noted that hospitals historically have discretion in how rate increases are applied across services.

Several participants proposed measuring primary care spending as a concrete indicator. A Milbank presenter said primary care spend is a “measure of progress” that can focus accountability and target incentives. The presenter noted states such as Rhode Island have tracked primary care spending closely and adjusted measurement over time, including denominator choices and out-of-state care considerations.

Legislators raised workforce and practice-management barriers to non-hospital primary care. Multiple lawmakers and presenters noted it is often administratively easier for clinicians to be employed by health systems, and that supports for independent practices and federally qualified health centers (FQHCs) will be necessary to move more care out of hospitals without impairing access.

The panel also discussed the Blueprint for Health as a delivery platform: participants said the Blueprint’s community health team approach can function as an engine for integrated primary care and behavioral health if funding and data flows are tied clearly to community-based practices.

What’s next: Committee members said they will carry primary care finance and Blueprint issues into bill drafting and follow-up hearings. Several speakers encouraged building metrics and auditing capacity to track primary care dollars and measure whether policy changes increase community-based capacity over time.