Designing Vermont's pay-for-population health system

Vermont is developing a health care system that could offer a unique opportunity to test a new model for improving population health. Four lines of development converged for the system: 1) a published challenge to create a pay-for-population health system, 2) comprehensive state health reform legislation, 3) the Institute for Healthcare Improvement Triple Aim project, and 4) the concept of the accountable care organization (ACO). In phase 1 of pilot testing, 3 communities serving 10% of the population are using the system, which is based on the enhanced medical home model. Planning is under way for phase 2 of the pilot, ACOs that use incentives based on the Triple Aim goals. Vermont has created a conceptual framework for a community health system and identified some of the practical issues involved in implementing this framework. This article summarizes the design and implementation of the enhanced medical home pilots and the results of a feasibility study for the ACO pilots. It describes how one state is using a systematic approach to health care reform to overcome some of the implementation barriers to a pay-for-population health system. Vermont will continue to provide a statewide laboratory for a pay-for-population health system.