Week in Review
As the legislature finishes its sixth week of the 2002 legislative session, the stage has been set for debate in the House of Representatives next week on that chamber's reapportionment bill. A purely partisan political process, reapportionment must take place every 10 years to ensure that legislative districts come as close as possible to representing the same number of voters from district to district. In 1990, the House was controlled by the Democrats, who used their power to re-draw legislative districts to favor incumbent Democrats. Republicans cried foul. That was then, this is now. Now, Republicans control the House and are re-drawing legislative districts in their favor. Now it's the Democrats, turn to protest. But, as one GOP lawmaker recently said, "To the victor goes the spoils."

In committee, the House Committee on Health and Welfare has drafted legislation to revamp Vermont's Medicaid program. The Committee on Ways and Means continued its deliberations over how best to re-write Vermont income tax law and has begun work on the annual Miscellaneous Fee Bill, legislation that makes adjustments to administrative fees. The Committee on Appropriations continued to dig into the FY03 general fund budget, hearing again from a variety of agency and department heads on their upcoming budget needs.

In the Senate, the Committee on Finance considered legislation to allow small businesses to buy into the Vermont Health Access Plan (VHAP) for health insurance coverage. That bill has already been voted out of the Committee on Health and Welfare. The Committee on Appropriations began to put its mark on the FY02 Budget Adjustment Act, while the Committee on Health and Welfare continued to review legislation to change the certificate of need (CON) process, a regulatory process hospitals must undergo prior to undertaking major capital improvements.

On the political front, former Agency of Human Services Secretary Con Hogan announced this week that he would bow out of the Republican primary for Governor and would instead run as an Independent. While well respected within government circles, Hogan suffers from a lack of name recognition, and was widely viewed as the underdog in the GOP race against State Treasurer Jim Douglas. His announcement sets the stage for at least a three-way race for the Governor's office, a race that could turn four-way if Anthony Pollina or someone else from the Progressive Coalition steps into the race. So what happens if no one receives 50% of the vote in November? The candidates then compete in an election held by a Joint Assembly of the General Assembly next January. Should the race for Governor be sent to the General Assembly, any edge given to the Republicans or Democrats in either the House or Senate through the reapportionment process becomes even more significant.

Medicaid Reform
Chair of the House Health and Welfare Committee, Rep. Tom Koch (D-Barre Town) introduced a proposal to redesign the Medicaid program making it financially sustainable. The new plan would continue to provide a safety net and benefit plans to recipients while also implementing cost sharing guidelines, health care vouchers and a cost containment strategy. Under this proposal the legislature would annually approve a Medicaid budget with an annual financial plan, a five-year plan and a spending cap no greater than the share of state spending in FY02. The process would require annual adjustments to benefit plans, cost sharing, utilization controls, and reimbursements to align Medicaid expenditures with the spending cap. This proposal would require annual rule changes and federal waivers.

The eligibility criteria in the proposal would allow existing Medicaid beneficiaries to continue as recipients -including those enrolled in Vermont's mandatory and optional Medicaid populations, VHAP and CHIP. The commissioner would have the authority to limit enrollment and create waiting lists for the optional VHAP, CHIP and Vscript programs in order to meet the spending cap. Other provisions in the proposal include the following:

• Benefit Plans - All mandatory Medicaid population shall continue to receive benefits in the Vermont Medicaid state plan including those eligible for long term care (nursing homes and community based services) through a benefit plan administered by OVHA. The optional Medicaid population, VHAP, CHIP, and VScript shall be offered acute care coverage through such options as enrollment in a choice of comprehensive health benefit plans, Medicare wrap-around benefit plan, or a premium subsidy of the beneficiary employee share of an employer-based plan. The state employees health benefit plan is recommended as a model. The bill proposes an annual deductible of $2250 for an individual and $4800 for a household. Plan Premiums would be subsidized on a sliding scale based on income.
  
• Vouchers - Each Medicaid beneficiary in a comprehensive health benefit plan, Medicare wrap-around plan, or an employer based plan would be offered a voucher redeemable for out of pocket health expenses and could, under certain conditions be used toward payment of the deductible.
  
• Health Benefit Plan - These plans would be offered by a health insurer regulated by the state. The Medicare wrap-around plan would be self insured by the state. The comprehensive health benefit plan would be a non-group plan and would use a Medicaid community rating method without premium deviation.
  The bill includes a reinsurance plan and cost sharing methods which have caps tied to household income. The final section of the bill, Medicaid system health care accountability, requires a report to the Legislature on the impact of the act on beneficiaries, health care providers and the Vermont Health care system. The outcome of this proposal is far from certain at this point.

CON Regulation
The Senate Health and Welfare Committee continued to hear testimony this week on S.286, the comprehensive bill aimed at reforming the hospital budget and Certificate of Need process. The committee chair, Sen. Nancy Chard (D-Windham) has suggested that the bill needs to be amended to address health care policy goals. She was not specific in her comments but that some of the more onerous initiatives outlined in the bill could be negotiated.

The Association is hopeful a mutually agreeable compromise will be reached. If a compromise is not reached, VAHHS will actively oppose S.286.

VHAP Buy In
The Senate Finance Committee heard testimony this week from a variety of witness regarding S.254, the proposal to allow businesses and individuals to buy into the Vermont Health Access Plan. With the strong support from the Dean Administration and a comprehensive actuarial analysis that estimates the plan to be offered at a premium of $200 per month per person, the committee is poised to approve this measure even with several committee members voicing opposition.

The current version of S.254 would allow individuals or businesses with less than 20 employees to buy into the state-run Vermont Health Access Plan (VHAP). Qualified businesses must not have offered health insurance to their employees for at least 12 months and a minimum of 75% of the employees must enroll. Additionally, the employer must pay 50% of the premium.

VAHHS has submitted testimony opposing S.254. The Association believes the Medicaid program should be on sound financial footing before adding new programs and populations.

No Action On…
Gross Negligence
S.258 Open Meeting Law
H.416 Medical Record Confidentiality
Medicaid Reimbursement

On the Agenda This Week
House Appropriations Committee - The committee does not have any health care issues scheduled this week.

House Health and Welfare Committee - The committee will be discussing the Medicaid budget on Friday.

Senate Health and Welfare Committee - The committee will continue their hearings on S.286, the CON bill with testimony from Daria Mason, CEO, Central Vermont Medical Center, Health South and others.

House Government Operations Committee - The committee will re-visit the language on Medical Practice Board and gross negligence on Thursday.