Political Overview

During the past month, the House of Representatives has established its own identity as an arm of government, separate from the governor's office. During the same period, the Vermont Senate has been nearly invisible as a political force due to the frequent absences of President Pro Tem Peter Welch, D-Windsor, due to personal matters that he had to deal with.

Eight major House committees have completed work on major bills, sometimes advancing the agenda of Governor Jim Douglas, but sometimes going their own way as well. The Appropriations Committee has completed its work on the FY 04 budget and passed it through the full House with little change to the committee's work. Several of the committee's decisions go contrary to administration proposals. The Institutions Committee has completed work on the FY 04 Capital Bill, sticking with the $39 million bonding cap supported by the administration. The Ways and Means Committee has approved a bill making dramatic changes to the way education is funded. The Commerce Committee has approved a renewable energy bill. The Judiciary Committee has approved a bill calling for tougher sentences for drug offenders but failing to endorse a so-called "Megan's law" for drug offenders, one of Governor Douglas' most visible campaign promises. The Transportation Committee has completed work on the so-called Transportation Capital bill, which determines in detail how roughly $300 million state and federal dollars will be spent out of the Transportation Fund. The Health and Welfare Committee has approved a bill making modest changes in the way that hospitals are regulated and passed it through the full House. The House Natural Resources Committee has approved a very complicated bill changing the process for obtaining development permits in Vermont. The bill is very similar to the recommendation unveiled by Governor Douglas early in the session.

With the exception of the Act 60 bill, which was approved on a 7-4 vote in the Ways and Means Committee, all of these major pieces of legislation received unanimous or near unanimous support in their committee of origin. This is the dynamic that established the House as a distinct political entity with real power in this legislative session. House committees are divided nearly evenly between Democrats and Republicans, with a Republican chair and Democratic vice chair on each committee. When a group of eleven very diverse people work for five or six weeks on a complex subject and reach near unanimous agreement on a solution, that solution has real political power through the rest of the process. Committee loyalty becomes the most powerful emotion felt by many members. Speaker Walt Freed, R-Dorset, deserves considerable credit for establishing this committee structure.

The Senate, on the other hand, has been essentially dead in the water since moving its Act 60 bill early in the session. S.57, the renewable energy bill, did pass the Senate this week, but it is basically the same bill passed by the Senate a year ago. The Senate also passed a few other less complex bills, such as S.144, the anesthesiologist assistant bill. The natural flow of the money bills, starting in the House and moving next to the Senate, is partly responsible for this apparent lack of activity in the Senate. It is nonetheless true that nothing approaching the cohesiveness that has been achieved in the House is present in the upper body.

If the House continues to mature as a political force while the Senate flounders, the House will have the clear upper hand when the determinative conference committee negotiations begin in about four weeks.

Issues of interest to VAHHS the General Assembly addressed this week include:

 -Certificate of Need (H.128), Whistleblower Protections (H.470)

H.128, a comprehensive certificate of need reform bill, passed the House on April 2nd. VAHHS lobbied hard on this bill and made significant progress on key issues, including hospital report cards and community assessments.

There was only one amendment that provoked any controversy on the House floor. That amendment, offered by Rep. Steve Hingtgen, P-Burlington, proposed to mandate hospital board membership, including requiring 40 percent of the board to represent consumers, 10 percent businesses, legislative representation and conflict of interest provisions that would bar any hospital employee including physicians from serving on the board, among other things. The House Health and Welfare Committee opposed this amendment. Chair Tom Koch, R-Barre, responded by stating that in 13 of the 14 hospitals, nobody seems to think that board structure is a problem. Koch went on to say that in most Vermont hospitals there are large groups of members that choose the hospital trustees in a democratic and open process. Koch said he'd like to see changes in the governance structure at Fletcher Allen and believes that the new leaders will make some positive changes. Koch also explained that a merger of four organizations created FAHC by contract and that the Constitution forbids the legislature from impairing contracts. "We don't have the power to do this," Koch stated. Rep. Anne Donahue, R-Northfield, made similar comments. Ironically, our harshest critic became our greatest defender on the House floor. The Hingtgen amendment failed 28-118. This overwhelming vote against a governance mandate will help us fend off this issue in the Senate.

There were only two substantive amendments to H.128 that succeeded on the House floor. First, requiring that a public notice regarding an applicant's CON be posted in the town clerk's office in the town in which the facility is located. Second, the removal of the whistleblower protection provisions for health care workers. At the strong urging of VAHHS, the House agreed to remove the whistleblower provisions to allow the House Judiciary Committee time to consider this new cause of action without holding up H.128. The whistleblower provisions were introduced as H.470 by the House Health and Welfare Committee and referred to the House Judiciary Committee. The House Judiciary Committee scheduled a hearing on H.470 on Tuesday, April 8, at 8:30 am. Text of H.470.

H.128 was referred to the Senate Health and Welfare Committee. That committee will be taking testimony on Weds. 4/9 and Thursday, 4/10. H.128 as it passed the House.

 - Anesthesiologist Assistants (S.144)

The Senate passed S.144, a bill that proposes to establish a system for certifying Anesthesiologist Assistants (AAs) in Vermont on April 3rd. VAHHS strongly supports this bill because it will help alleviate the severe nursing shortage faced by Vermont's hospitals. VAHHS will now shift its focus and urge the House to pass the bill. The bill was referred to the House Government Operations Committee. A hearing is scheduled for April 16th. Here is a link to the Text of the bill as it passed the Senate.

 - FY04 Medicaid Budget (H.464)

The FY 04 budget bill passed the House on April 2nd. Only a few minor amendments were made to this lengthy bill on the House floor. Significantly, the House agreed to replace the existing co-payment requirement for Medicaid recipients with premiums based on a recipient's household income. This proposal has the potential to increase costs for families with incomes of $40,000-50,000 with children enrolled in the Medicaid program, and decrease costs for older, sicker Vermonters with chronic conditions. VAHHS supports this proposal for a number of reasons including the fact that the state will collect the premiums, rather than the current system where the hospitals are responsible for collecting the co-payments. While there are still a lot of unknowns about this proposal, it may decrease the cost shift.

The House also agreed to cut in half Governor Douglas's proposal to impose a 5 percent coinsurance requirement for hospital inpatient and outpatient services with a $100 annual cap for adult Medicaid beneficiaries enrolled in PC-Plus (managed care) and those enrolled in fee-for-service. The House-approved budget reduces this coinsurance requirement to 2.5 percent with a $50 annual cap. This change to the coinsurance requirement will cost the state $400,000 in total state and federal funds. In turn, it has the potential to save hospitals up to $400,000 (assuming they were unable to collect any of the payments from the patients).

The House didn't make any changes to the budget relative to nursing homes. The budget contains $3.1 million to fund a 3.8 percent inflation factor for nursing homes. Funding for half of the inflation factor will come from an increase in the nursing home bed tax and the other half will be paid for with state general fund dollars.

Here is a link to the FY04 budget bill as it passed the House. Medicaid is section 147.

 - Provider Taxes (H.472, Miscellaneous Fee bill)

This week the House Ways and Means Committee advanced H.472, a bill that proposes to revise various executive branch fees, including the provider tax. The revisions to provider taxes contained in the bill are the same as reported a few weeks ago:

Hospitals - Effective July 1, 2003 to July 1, 2004, the hospital tax will be reduced from 3.60 to 3.25 percent of net patient revenues (less chronic, skilled and swing bed revenues). From July 1, 2004, to July 1, 2005, the hospital tax will be reduced again from 3.25 to 3.04 percent. For a psychiatric facility (the Brattleboro Retreat), the annual assessment for the next two years will be 3.58 percent. The Retreat's rate is different because it is not subject to the disproportionate share cap. The Retreat will only be taxed if the state is able to obtain a waiver from the federal government.

Nursing Homes - From July 1, 2003, to July 1, 2005, the nursing home bed tax is proposed to increase by $221.96 (from $3,166.29 to $3,388.25).

Home Health Agencies - Beginning July 1, 2003, the bill proposes to increase the assessment on home health agencies from 12.9 to 15.0 percent of their net operating revenues from core home health services.

These provider taxes will sunset on July 1, 2005.

Here is a link to the text of the bill. The provider taxes are listed in sections 24-31.

S.25, Child Passenger Safety Seats

The Senate passed S.25, a bill that requires booster seats for children up to the age of eight traveling in a motor vehicle, among other things. VAHHS supports this bill. Text of the bill as it passed the Senate.

S. 159, Birth Information Network

This week the Senate passed S.159, a bill that proposes to create a birth information network for the purpose of identifying and enrolling in services infants whose health and welfare would benefit from early medical intervention and health and social supports. Text of the bill as it passed the Senate.