Delivery of Care

The strength of the single payer vaccine plan in RI

Will the Affordable Care Act eventually eliminate Rhode Island's state mandate for insurers to help pay for vaccines?

Photograph courtesy of Peter Simon's Facebook page

Dr. Peter Simon at the recent 2015 Health Equity Summit

By Peter Simon
Posted 5/18/15
Rhode Island has one of the most effective vaccination programs in the nation, funded in pat through a state mandate on commercial insurance plans, creating a cost-effective, single-payer plan that saves $5 million a year in health costs every year.
Are there other opportunities to expand the business model used for vaccines and bulk purchasing through the Centers for Disease Control and Prevention and apply it to new costly drugs, such as those that treat and cure Hep C and other potential new vaccines as they are developed? Are there ways to integrate the cutting-edge work being done by EpiVax to make vaccines more effective into a competitive advantage for Rhode Island’s biomedical industry?
In a new report recently released by the Centers for Disease Control and Prevention, entitled “Educational Interventions for Children Affected by Lead,” the executive summary begins on a somber note. Despite the body of evidence that demonstrates the effects that low-level lead exposure has on the brain’s learning systems – including overall intellectual ability, speech and language, hearing, visual-spatial skills, attention, executive functions, social behavior and gross motor skills – there are “no studies that specifically examine the impact of early childhood educational interventions on cognitive or behavioral outcomes for children who have been exposed to lead.”
There are, the report continues, studies of educational interventions improving developmental outcomes for children who have conditions other than lead. That research demonstrates the importance of early intervention. The question is: who among the early childhood advocates, the public health researchers, the hospitals, the universities, the academic research centers, will step up and consider making Rhode Island a hub of such interventions for children who have been exposed to lead?

PROVIDENCE – Many people may not know this, but Rhode Island’s vaccine program for children managed by the R.I. Department of Health is actually a cost-effective, single-payer plan.

A while back, ConvergenceRI cited the former R.I. Health Insurance Commissioner Christopher F. Koller, who pointed out that Rhode Island was an early adopter in the 1990s of this small, innovative “single-payer system” for childhood immunizations.

It is the kind of proven, evidence-based health intervention that has yielded enormous benefits: high rates of coverage that prevent transmission of measles, influenza and other infectious epidemics that can only be stopped by maintaining what’s known as “high herd” immunity. [See link below to a ConvergenceRI story about the R.I. Department of Health’s recent intervention in response to an outbreak of meningitis at Providence College.]

Yes, I know, it is hard to believe, but Rhode Island’s universal immunization program [we pay for any vaccine approved by the Advisory Committee for Immunization Practice at the Centers for Disease Control and Prevention] has purchased and distributed vaccines for all children in Rhode Island for the last 20 years.

This is how Rhode Island achieves its top ranking for childhood vaccination in the U.S.

Saving $5 million a year
Using funds from the federal government, which is supplemented by a tariff on insurance premiums, the program has been able to save about $5 million a year purchasing all vaccines at prices negotiated with vaccine manufacturers through competitive bidding managed by the CDC.

Imagine, for instance, what we could save through this implementing approach for Medicare Part D medications.

That is the good news; the not so good news is that this nationally recognized approach to prevent vaccine preventable diseases may not last much longer.

In January of 2016, a new law will take effect. It was introduced at the request of Blue Cross & Blue Shield of RI and enacted during the last legislative session. The new law will spread the cost of vaccine purchase and distribution system over all insurers who sell health insurance defined the way the Affordable Care Act does. No longer will there be a large group of self-insured policies who were exempted from this state mandate.

In the tradition of full transparency and disclosure, before I tell you more about how Rhode Island has been paying for all its vaccines for children and some vaccines for all adults, I need to tell you that I believe that vaccines are the most important health innovation of the last 200 years. 

I cannot think of any other technology that has done more to prevent disease, disability and premature death.

I feel so strongly about this that when I encountered parents who questioned the importance of vaccination, I had to tell them to find another pediatrician. I hope I did it in a way that provoked some thought about changing their minds, but even short of that, I felt I could not be the best I could for their child without their trust to vaccinate according to the advice of medical experts at the Centers for Disease Control and Prevention.

I also need to tell you that Rhode Island has consistently been at the top of the list of states for vaccine coverage. Not only do we have an effective program, we are purchasing, distributing and safeguarding vaccines in a way that has been saving all of us taxpayers millions of dollars every year.

If you have children and go to a medical office in Rhode Island, you will never be billed for the biological vaccines required by law for school entry.

You will see only a charge for the administration of the vaccines, covering the cost of syringes, nursing time, etc.

Even if you bring your child to a provider in Rhode Island who does not participate [I do not know for sure how many there might be; I never knew of any while working at the R.I. Department of Health], the doctors will not be reimbursed by Rhode Island insurers for the cost of the vaccine.

Last time I did the math, Rhode Island was saving about $5 million annually for each birth cohort entering the program.

Rhode Island stands alone
Rhode Island alone persists with this program’s financing model.

In order to spread the cost over as many “covered lives” as possible, the new legislation put forward by Blue Cross, which serves as a third-party administrator for the bulk of self-insured plans in Rhode Island, will make two types of changes: who pays into the assessment; and how the cost to each plan will be calculated. 

Along with all licensed health insurers who do business in the state, entities that administer self-funded plans (third-party administrators) will also be required to pay to cover the vaccine cost for self-insured firms.

Instead of paying a percentage of their policy premiums under the formula that is currently in place, beginning July 1, the amount paid to cover the assessment for vaccines will be based on the number of contribution enrollees for both children and adults. 

Here's how it will work: the immunization program will develop a budget to determine how much is needed to cover the cost of all child and adult vaccines for insured population and the operation of the program. Then, the total number of contribution enrollees will be divided by that budget number, to produce the cost per contribution enrollee. This cost will then be applied across the board.

Thanks to Blue Cross, we have an equitable formula for continuing this universal purchasing and distribution system. The question remaining, and it's a big one, is this: what happens in 2018 when the feds have the option to discontinue its reimbursement to Rhode Island for the cost of state-mandated benefits included in health insurance products qualified under the Affordable Care Act?

Dr. Peter Simon is a pediatrician who retired from the R.I. Department of Health in 2013. He still sees pediatric patients at a number of clinics.


No comments on this story | Please log in to comment by clicking here
Please log in or register to add your comment

© | subscribe | contact us | report problem | About | Advertise

powered by creative circle media solutions

Join the conversation

Want to get ConvergenceRI
in your inbox every Monday?

Type of subscription (choose one):

We will contact you with subscription details.

Thank you for subscribing!

We will contact you shortly with subscription details.