Political Overview

For the moment, policy is predominating over politics. In anticipation of Town Meeting Day, Vermont's legislative and executive branch leaders are eschewing political attacks in favor of detailed papers on issues like education funding for use in educating voters attending Town Meeting.

Even with little or no progress on the marquee issues of permit reform and health care cost containment, Governor Douglas has not been critical of the General Assembly for its go-slow approach to these issues. Nor has the democrat controlled Senate attacked the new administration when given the opportunity, such as in the confirmation of Fish and Wildlife Commissioner designate Wayne Laroche. In spite of past evidence of Laroche's extreme rhetoric on some issues, a democratic-controlled committee recommended his confirmation to the full Senate late last week, saying that the new Governor deserved to get his team in place and have a chance to perform.

This civil approach to governing reflects in part the personalities of the state's three top political leaders. Governor James Douglas, House Speaker Walter Freed, R-Dorset, and Senate President Pro Tem Peter Welch, D-Windsor, all are moderate, soft spoken people known more for their thoughtful approach to policy making than for their bomb throwing.

This quiet in the Vermont political arena does not necessarily mean that real progress will be made on the pressing issues of the day. There are real policy and philosophical differences between the House and Senate majorities and real differences between the executive and legislative branches about how to balance the state's budget. Whether or not to further use cost shifting to help balance the Medicaid budget is an example of the latter. With only eight weeks to go before the target adjournment date of April 26th, the likely result is that the tough policy issues will be "studied" over the summer and fall and the money issues will be resolved by tweaking case load estimates and putting the hard decisions off until another day when we have a better picture of where the economy is going.

Meanwhile, those who like political barbs for entertainment will have to look elsewhere. For now, Vermont's politicians have their heads in their policy books, not their poll results.

Specific issues addressed this week by the General Assembly include:

Provider Tax Update

Revisions to the provider tax assessments for hospitals, nursing homes and home health agencies were released this week to the Senate Finance Committee as part of the miscellaneous fee bill. The bill is in draft form and has not been introduced yet. The proposal calls for the following assessments:

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. The rate decreases because the agency of human services expects hospital revenues to increase and they want to keep the amount of tax revenue to remain constant and within limits set by federal law. For a psychiatric facility, the annual assessment for the next two years will be 3.58 percent. According to the agency, this psychiatric facility rate applies only to the Brattleboro Retreat because it is not subject to the disproportionate share cap. The Brattleboro 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.

Under the proposal, all these provider taxes will sunset on July 1, 2005.

Certificate of Need (H.128, S.63)

Both the House and Senate Health and Welfare Committees took testimony this week regarding certificate of need reform.

After a solid month of testimony on H.128, Rep. Tom Koch, R-Barre, the Chair of the House Health and Welfare Committee declared this week "we are in a mess" and that "no single concept" has emerged from the committee's debate. As such, Koch said that the committee would not work on H.128 the week they return from Town Meeting recess. Instead, they will hold a number of joint hearings with the House Government Operations Committee regarding reorganization of the Agency of Human Services. Koch did not say when the committee would return to work on H.128.

Earlier in the week, the House Health and Welfare Committee received a new draft of H.128. Instead of narrowing the issues, the revised 63-page bill is even more burdensome on hospitals than the bill as introduced. The only item the committee reached agreement on this week was to create a 21 member "health planning board" (HPB). The HPB would be charged with writing a 3-year state health plan. The Governor would approve the plan.

In other news, the Senate Health and Welfare Committee started taking testimony on S.63, a CON reform bill that VAHHS supports. Bea Grause testified on behalf of VAHHS, among others. Chair Jim Leddy, D-Chittenden, said he hoped that the House will be able to pass H.128 and, if so, the senate will work from that bill. Until then, however, Leddy intends to move forward with S.63. Leddy believes that passing a CON reform bill will likely take two years.

Susan Gretkowski, Deputy Commissioner of the Division of Health Care Administration, said the Douglas Administration believes S.63 is "a good starting point." The Division supports the main provisions in the bill, including raising the CON thresholds, developing a better health plan to guide CON decisions, allowing an intermediate appeal before the commissioner if a CON is going to be denied and a three-tiered CON review process for major and minor projects, among other things. In fact, the only provisions the division opposes are the requirement that the CON review process commence no later than 60 days after the division issues a notice to the applicant that additional information is required (sec. 4) and a provision related to "material change" of a CON project (sec. 9). Here is a link to S.63 for your reference.

Susan Gretkowski Resigns

Susan Gretkowski announced to both the House and Senate Health and Welfare Committees that she resigned from her position as Deputy Commissioner of the Division of Health Care Administration within BISHCA and has taken a position at Gifford Medical Center as Director of Public Relations and Community Outreach.

FY 2004 Medicaid Budget

Erica McNamara, VAHHS Vice President of Finance/COO, testified before the House Health and Welfare Committee on Tuesday, February 25th, regarding the proposed FY 2004 Medicaid budget. McNamara explained that the cost of providing health services in Vermont is low when benchmarked to national and regional numbers. McNamara also explained that the Douglas Administration's proposal to replace co-pays with tiered deductibles in the Medicaid program would increase the amount of cost sharing for Medicaid beneficiaries. A recent Office of Vermont Health Access report shows that on average 85 percent of cost sharing eventually becomes free care or bad debt. With this average, the current proposal will increase the cost shift for hospitals between $4.3 and $6.2 million. McNamara also testified in opposition to the removal of "elective" inpatient hospital admission coverage from the VHAP program. This cut was part of the FY03 budget rescissions made last summer. The committee understood VAHHS's concerns but there was a general feeling of frustration on how to improve the situation.

S.76, Medical Marijuana

By a vote of 5-1, the Senate Judiciary Committee advanced S.76, a bill that proposes to allow the use of medicinal marijuana under certain circumstances. VAHHS raised a concern privately with the chair of the committee, Senator Dick Sears, D-Bennington, that the bill may allow residents of nursing homes or patients in hospitals to smoke marijuana. The bill prohibits smoking medical marijuana in "public places." Senator Sears believes a hospital or nursing home room is a public place and therefore smoking of medical marijuana would not be allowed under the bill. However, it is still somewhat vague since there is no definition of "public place" in the bill. We plan to clarify this in the House, if and when they decide to take it up. Significantly, Governor Douglas announced this week that he opposes the bill because using medical marijuana would still be illegal under federal law and there are other drugs available to help those suffering from serious medical conditions. The bill is on the Senate Notice Calendar and the Senate is expected to take up the issue when they return from their Town Meeting recess. Here is a link to the Senate Calendar with the text of the bill.

Nursing Ratios and Mandatory Overtime Bills Introduced

Two bills of particular interest to hospitals were introduced this week. First, H.335, a bill that proposes nurse staffing ratios for Vermont's hospitals. Second, H.337, a bill that prohibits mandatory overtime in hospitals. Both bills were referred to the House Health and Welfare Committee.

S.25, Child Passenger Safety Seats

The Senate Transportation Committee took testimony on S.25, a bill that requires booster seats for children up to the age of eight traveling in a motor vehicle, among other things. The committee asked lots of questions and will decide how to proceed once they receive the information they requested. VAHHS supports this bill.