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For the week ending February 13, 2004
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Political Overview The possibility of gridlock on some of the major issues facing the General Assembly this session is real as both parties jockey for position for the upcoming fall elections. The Democrats know they have to articulate alternatives to Republican Governor Jim Douglas's proposals if they want to get any traction in the fall elections. This week the Democrats offered an alternative for how to spend the revenue the state will generate by the Governor's proposed elimination of the 40 percent exemption for the capital gains tax. The Governor wants to use the revenue to reduce income tax rates. This week the House Democrats proposed to use the funds to reduce property taxes by returning approximately $15 million through a municipal revenue sharing proposal, allowing each town to receive approximately $25 per resident. The political challenge at this time is for lawmakers to put aside politics and see if common ground can be found on this and other issues. This is tough to do with a two year election cycle and it remains to be seen whether it can be done this session.
It is also worth noting that this week the advocates for community mental health programs pulled off one of the largest turnouts for a rally and day of lobbying at the State House by any advocacy group in recent memory. Arriving by coach, school bus and van, hundreds of mental health clients, workers and families came to Montpelier to protest the Douglas administration's proposed appropriation for community mental health programs that serve 35,000 Vermonters. The administration proposed a 1 percent increase in FY05, which would bring funding to $104 million. Mental health advocates say a 5 percent increase -- roughly $5 million -- is the bare minimum needed this year by the 10 nonprofit, community mental health agencies across the state. The sheer number of people involved in this effort certainly caught the attention of lawmakers.
VAHHS Issues
FY 05 Medicaid Budget Commissioner John Michael Hall of the Department of Prevention, Assistance, Transition and Health Access (PATH) presented the FY05 Medicaid budget to the House Appropriations Committee on Friday. Hall presented a proposed $580 million Medicaid budget for FY05, up from $538 million in FY04. Commissioner Hall told the committee that the proposed budget did not contain cuts in Medicaid programs and that most programs were level funded. Significantly for hospitals, the federal Medicare law that was recently enacted by Congress allows Vermont to raise the cap on Disproportionate Share Payments (DSH) to hospitals by 16 percent. As a result, the state plans to draw down an additional $4.3 million in federal funds. This will likely mean an increase in the hospital provider tax but there is no specific proposal on the table at this point to increase the tax. With regard to funding increases for hospitals, nursing homes and home health providers, the written materials Hall provided to the committee contained the following increases:
We note that the written materials were confusing and appeared to conflict in certain areas so these figures are only early estimates. We will meet with agency officials and will provide a more detailed report on the FY05 Medicaid budget and how it will affect hospitals and nursing homes next week.
Hospital Licensing Fees/X Ray Equipment Fees Bea Grause testified on behalf of VAHHS in the House Ways and Means Committee in opposition to the new hospital licensing fees the Department of Health (DOH) is proposing as part of the Douglas Administration's miscellaneous fee bill. The proposal is to increase the hospital licensing fee from a $10 application fee (established in 1949) to a $7,250 base fee, plus impose a new fee of $25 per hospital bed. A hospital can reduce the base fee to $4,250 if it is accredited by the Joint Commission on Accreditation of Health Care Organizations. These fees are estimated to generate an additional $120,825 per year, which the DOH proposes to use to cover the cost of staff that handles the licensure process. Bea opposed these fees increases because they were too high and suggested that the fees be reduced by half. The committee asked representatives from VAHHS and the DOH to meet and work out an agreement on the fees and come back and present it to the committee. The committee is scheduled to take up the issue again on Friday, February 20th.
Agency of Human Services Reorganization On Monday, February 9th, Agency of Human Services Secretary Charlie Smith presented a draft reorganization plan to the State Advisory Group. The final plan will be presented to a legislative oversight committee on February 17. The proposal is to reorganize the current six departments and two offices within the agency into four departments and one office. The four departments are: The Department of Health, the Department of Children and Family Services, the Department of Aging and Independent Living and the Department of Corrections. The Office of Vermont Health Access will continue to exist as well. Here is a link to the draft plan as well as organizational charts outlining these new departments from the Agency of Human Services webpage. https://www.ahsnet.ahs.state.vt.us/council/Docs/reorgplan020904.cfm Secretary Smith will also present the final reorganization plan on Friday, February 20, 2004 in Room 11 at the State House from 12 Noon to 1:30 p.m. After that presentation we will provide an analysis of how the reorganization will affect hospitals and nursing homes.
International Emergency Management Assistance Compact (S.290) This week the Senate Government Operations took testimony on S.290, the International Emergency Management Assistance Compact. This bill will allow Vermont hospitals to share human resources, equipment, supplies and pharmaceuticals with our Canadian partners in the event of a disaster. VAHHS submitted a letter of support for Section 2 of this bill. Vermont is already a signatory to the Emergency Management Assistance Compact.
Health Insurance Reform (H.713) This week the House Health and Welfare Committee took testimony on H.713, the Governor's health insurance reform bill. The testimony included very detailed information about health insurance markets and rates. The committee will take a break from this bill next week in order to take testimony and mark up a bill related to advanced directives and palliative care on Feb. 17 and 18th.
Two senate committees divvied up portions of S.288, the prescription drug bill, to work on. The Senate Finance Committee will tackle the portions of the bill related to disclosure of retail prices, regulation of pharmacy benefit managers (PBM's), audits of PBM contracts and coverage for prescription drugs purchased from pharmacies outside of country. The Senate Health and Welfare Committee will focus on making changes to the Healthy Vermonters Program. This is an existing pharmaceutical assistance program that provides drugs at the Medicaid rate to elderly and disabled individuals with incomes up to 400 percent of the federal poverty level and others with incomes up to 300 percent of the federal poverty level. The committee is considering making changes to allow more Vermonters to qualify for coverage under the Healthy Vermonters program. Both committees will continue taking testimony on these issues next week. H.737, a bill related to long term care insurance and the Vermont Partnership for Long Term Care, passed the House this week. This bill brings Vermont law in line with the National Association of Insurance Commissioners (NAIC) model law on long term care insurance. The more controversial provision in the bill, the so-called "nest egg provision," was challenged by the House Democrats who tried but failed to strike it out of the bill on the House floor. The nest egg provision is a proposal to allow Vermonters to be able to keep their assets if they purchase long term care insurance to cover at least the first three years of long term care services. http://www.leg.state.vt.us/docs/legdoc.cfm?URL=/docs/2004/bills/intro/H-737.HTM
Insurance Parity for Naturopathic Physicians (S.184) This week the Senate Finance Committee voted 5-0-2 to advance S.184, a bill that requires insurance companies to cover services provided by naturopathic physicians. It is unclear at this time if the bill will be sent to another committee. Here is a link to the text of the bill from the Senate Calendar for February 17, 2004. http://www.leg.state.vt.us/docs/legdoc.cfm?URL=/docs/2004/calendar/sc040217.htm
Legislative Committee on Administrative Rules The Legislative Committee on Administrative Rules (LCAR) met on Thursday, February 12th, and approved two health-related rules. The first rule relates to the Board of Nursing. The rule requires that all nursing faculty have a master's degree in nursing. The Vermont Organization of Nurse Leaders (VONL) and the Department of Health (DOH) expressed concern over the requirement. VONL met with the Board of Nursing and an agreement was reached that nursing degree programs (Baccalaureate and Associate) may use clinical instructors who do not hold the educational qualifications but who have clinical experience relevant to the area of responsibility. The Board agreed that it is appropriate to allow clinical instructors to have a degree in a related field if they are teaching the clinical aspects of nursing only. The second rule is a DOH rule to add Severe Acute Respiratory Syndrome (SARS) to the list of diseases required to be reported to the DOH by physicians, health care providers and others mandated to report by statute. It also requires pharmacists to report certain sales or requests that may be evidence of an outbreak or bioterrorism event.
The House and Senate Health and Welfare Committees will jointly hold a public hearing regarding "End of Life Care: Choices and Challenges," on Thursday, February 26, 2004, at 7 pm in Room 11 of the State House.
Public Hearing on FY05 Budget The House Appropriations Committee will be taking testimony from the public and advocates on the FY 2005 Budget. The testimony will be taken on Thursday, February 19, 2004 from 9:00 a.m.-12:00 noon and 1:00-2:00 p.m. in Room 11 at the State House. VAHHS will testify on the Medicaid portion of the budget and will ask for an inflation increase for providers. |