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For the week ending March 25, 2005

As we move into the last third of this session, the committees are beginning to narrow their focus on a few key issues. The Appropriations committees are in full swing as they work through next year’s budget and the legislative leadership and the Administration have begun to focus on the end-game.

This week the Senate’s veto over-ride of S. 74, An Act Relating to the Allocation of the Assets of the State Teachers’ Retirement System of Vermont, the Vermont State Employees’ Retirement System, and the Vermont Municipal Employees’ Retirement System, took center stage this week. Governor Douglas vetoed this bill on Thursday, March 17, claiming the "super board" that oversees the combined fund would be selected in an undemocratic manner. Next week, the House is expected to take up this veto-override effort, but given the expected party line vote on this issue, the override effort will likely fail. The House debating and passed the FY06 budget bill today. Not included in the budget is Medicaid. Medicaid, however, still crept into the debate in the form of multiple amendments. Some of the Republican-offered Medicaid amendments included parts of the Governor’s budget proposal and none of those proposals passed. The House retained the $250,000 appropriation for nursing loan forgiveness and removed the sunset date. Not included was the $100,000 appropriation for loan forgives for nursing faculty.

VAHHS Issues
Medicaid: Both the Administration and the House/Senate Medicaid working group met this week without much progress. In the Administration meeting, Commissioner Crowley again emphatically stated their “cuts, no-cost-shifting” stance. The Administration did admit however, that they would need to pass legislation that would allow them to prevent cost-shifting. This requirement will make it that much harder for the Administration to succeed on this issue. The remainder of the discussion focused on whether hospitals would prefer cuts to begin in July or October and whether hospitals would prefer a cash payment at the beginning of the month with reconciliation at the end of the month.

In the House/Senate Medicaid working group, the discussion focused on prescription drugs again, with Josh Slen walking through suggestions developed by the committee in the previous week. This Committee would like to begin a hospital discussion next Tuesday evening at 6pm (March 29th). We have asked Senator Bartlett for an agenda. Once the committee begins to focus on hospital issues, this focus will likely last for weeks. These are the meetings where we believe it would be most helpful for hospital CEOs and CFOs to participate.

Health Care Reform
The House Health Care Committee unveiled an outline of their systemic reform bill Thursday afternoon and provided a draft bill on Friday afternoon (see outline and draft bill). The system goals include:

• coordinated care: state-wide system of health care providers and facilities (integrated patient care organized by regions)
• uniform benefits: all essential health care services will be covered
• universal access: available to all Vermonters
• control of spending: fixed annual funding and incentives to emphasize health promotion and prevention and to provide services in a cost-effective manner.

The financing mechanism includes:

• Establish funding for system w/broad based tax (2/3 payroll tax, 1/3 income) in 2005
• low initial rates to provide Medicaid funding bridge to reform, system implementation, and set aside for transition assistance in 2007 to employers currently providing insurance for their employees
• increase tax rates in 2007 to fund implementation
  

Act 53--Hospital & Health Care System Accountability
Representative Anne Donahue, R-Northfield, reviewed for the House Health Care Committee Act 53 which was passed last year. Act 53 is a law designed to improve statewide health planning to better manage issues of health care access, quality and cost. It created tools for payers and consumers via information to compare hospital costs and performance. It increased community-hospital dialogue by requiring community needs assessment and hospital report cards with public involvement. It calls for the creation of a health resource allocation plan to guide appropriate development of facilities and services. It also intended to create a fair and predictable regulatory system.

H. 115 – An Act Relating to Advance Directives
The House Judiciary Committee continues its work on the Advance Directives bill. The committee has dedicated more time into this bill due to the Terri Schiavo case. The committee has changed the definition of resuscitate to include chest compressions and mask ventilation; intubation and ventilation; defibrillation or cardioversion; bag-valve-mask ventilation; and emergency cardiac medications provided according to the guidelines of the American Heart Association’s Advanced Cardiac Life Support program. The committee added the clarification about DNR not affecting other appropriate therapeutic interventions. They deferred discussion on the objection and Ulysses clauses, and did not address the mature minor issues through this bill. The committee is inclined to retain the requirement that a health care provider provide notice of a revocation to the agent, guardian, clinician, any individual designated to receive notice in the advance directive, and the patient's clinician, health care facility, residential care facility, the registry and any individual known to hold a copy of the advance directive.

H. 450 – An Act Relating to Certificate of Need
VAHHS President Bea Grause, legal counsel Anne Cramer and Meg O’Donnell of Fletcher Allen Health Care, did a walk through of the VAHHS CON bill for the House Health Care Committee. Grause stated that VAHHS introduced legislation at the suggestion of the Senate leadership. VAHHS met with the Department of Banking, Insurance, Securities and Health Care Administration (BISHCA) to draft the proposed bill. Cramer highlighted which areas the two organizations are in agreement and where we are not. The committee has not indicated whether or not they will move further on this bill.

H. 518 - Capital Bill
The House Institutions passed out the Capital Bill late Wednesday afternoon, but not before a very heated discussion about the appropriation to the Vermont State Hospital. Michael Smith, Secretary of the Agency of Human Services, requested an appropriation of $725,000 for planning such as site inspection and permitting. The Committee was appalled at the lack of a written plan and dropped the appropriation to $25,000. The House leadership immediately went to committee to defend the full amount. In the end, the committee allocated $330,000. Also included in the bill is $150,000 for improvements to the current State Hospital.

S.27 - Safe Haven for Abandoned Babies
The Senate Judiciary took testimony on a bill that proposes to establish a safe haven defense to the crime of abandoning a baby for a person who leaves a baby with a responsible person at a hospital, police station, or fire station. Forty-six states have passed similar legislation that encourages troubled mothers to leave their children in good hands. The committee is discussing what constitutes a safe haven and maximum abandonment age. The draft language currently has the immunity law apply to children under 2 and that hospitals, fire and police stations as safe havens. The committee is contemplating including a two-week “change of heart” clause that would allow parents to reclaim their child without penalty and removing the affirmative defense provision. Once these issues are resolved, the committee plans to vote the bill out. VAHHS supports this bill.

S. 113, An Act Authorizing Nonprofit Hospitals to Convert Charitable Assets
VAHHS legal counsel Anne Cramer testified on the bill Tuesday. As stated previously, VAHHS feels there is no need for the regulations. The bill seeks to add a substantial review process before the Attorney General for the transfer of assets from a nonprofit hospital to another nonprofit or for-profit organization. It is our expectation that the revised bill will be passed out of the committee.

S.147 - An Act Relating to the Vermont Health Care Plan
Senate Finance and Senate Health & Welfare did a walk through of Senator Ed Flanagan’s health reform bill. The bill supports a government-run program that would provide universal access to health care through a system financed with a mix of payroll and income taxes. The proposal would attempt to control costs by imposing a global budget on hospitals. The bill has the support of the majority of the Senate Health & Welfare Committee. The House Health Care Committee has indicated that they may incorporate pieces of the Flanagan plan into their proposal.

Bills of interest introduced this week:

H. 511 – AN ACT RELATING TO MEDICAL DISCOUNT PLANS: This bill proposes to establish standards and consumer remedies relating to medical discount plans and marketers.

H. 512 - AN ACT RELATING TO STATEWIDE HOSPITAL PERFORMANCE REPORTS: This bill proposes to require the commissioner of banking, insurance, securities, and health care administration to prepare a statewide hospital performance report.

H. 516 - AN ACT MAKING APPROPRIATIONS FOR THE SUPPORT OF GOVERNMENT: This bill proposes to make appropriations in support of government for the fiscal year beginning July 1, 2005.

H. 518 - AN ACT RELATING TO CAPITAL CONSTRUCTION AND STATE BONDING: This bill proposes to authorize bonding, appropriate capital funds, and address miscellaneous related issues.

NOTICE OF ADVOCATES HEARINGS
The Senate Appropriations Committee will hold its Fiscal Year 2006 Budget advocates hearings on Tuesday afternoon, April 5 in the Senate Chamber. Advocates wishing to schedule time before the Committee regarding the Fiscal Year 2006 Budget should contact Becky Buck at the Legislative Joint Fiscal Office located at 1 Baldwin Street (phone: 828-5969).