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For the week ending April 1, 2005
Political Overview
The big political battle this week continues to be the Administration’s strong opposition to the draft health care reform bill unveiled by the House Health Care committee.
The Governor received a big win today on the veto override on the state’s pension funds. With 144 House members present, the House democrats were only able to capture 87 votes of the 92 needed and the override was defeated. The vote was to occur on Tuesday, but after counting votes the democrats realized that they were short approximately eight votes.
On non-health care matters, it appears that the Agency of Natural Resources (ANR) is up for re-organization to improve its efficiency and effectiveness. ANR will begin the process of reorganizing much like the process taken with the Agency of Human Services reorganization. There is agreement that the three departments within the agency aren’t well integrated, agency policies aren’t carried out in a consistent or coordinated manner, and policies within the agency sometimes conflict with environmental policies in other state agencies. Newly appointed Secretary Tom Torti will lead the effort.
VAHHS Issues
Medicaid:
The Douglas Administration received notification late Thursday from the Centers for Medicare and Medicaid Services (CMS) that they generally approve of the global commitment concept proposed by the Administration. CMS specifically stated that the letter should not be interpreted as an approval of the global commitment. According to Secretary of Human Services Michael Smith, the agreement will eliminate the $80 million Medicaid deficit, but the details of how this deficit would be resolved remains a mystery. The global commitment apparently will provide the state with “unprecedented flexibility” but again, details and clarity remain elusive. The Administration will reveal its tentative Medicaid agreement with the public on Monday.
The House/Senate Medicaid working group met this week and tension is increasing as time ticks away. The work group is demanding clarity from the Administration related to the global commitment. That “clarity” came yesterday when representatives of the working group were called to meet with the Administration about the tentative global commitment agreement reached with CMS. The productivity of the working group will likely increase beginning next week.
Rep. O’Donnell and Rep. Mark Larsen did a review of the restraints and modifications proposed by the Administration and presented their recommendations. Although the committee did not formally agree to accept these recommendations, it is the first “real” recommendation offered. If accepted the savings would be $4.8 million.
The House Appropriations committee will begin working on the Medicaid budget as early as next week. The goal is to report the Medicaid budget on the House floor by the last week of April.
Health Care Reform
The House Health Care committee “walked” through of their draft bill and took testimony on reactions to the bill. VAHHS weighed in at every opportunity. Hospital testimony included: Bea Grause, President of VAHHS, Peter Hofstetter, CEO at Northwestern Medical Center, Meg O’Donnell, Director of Government Relations at Fletcher Allen Health Care, John K. Evans and Kim Kalajainen of Vermont Information Technology Leaders (VAHHS-sponsored initiative), Greg Farnum of VAHHS, and Steve Moss, CFO at Central Vermont Hospital. Grause, Hofstetter and O’Donnell commended the committee for the work done to date, but stated that the devils are in the details. All stated they support universal access to care for Vermonters and thanked the committee for including a mechanism for bridge funding and health information technology. Areas needing further clarification include: governance structure, benefits plans, budget process and the unrealistic timelines. Evans and Kalajainen discussed VAHHS’ HIT vision and goals to inform clinical practice by utilizing electronic health records, developing an infrastructure to interconnect clinicians, personalize care by providing information to patients and families while protecting privacy, and improve the health of the population. The committee asked that Evans and Kalajainen draft language to include their draft bill related to health information technology. Farnum and Moss did a general overview of the Health Information Portability and Accountability Act (HIPAA) and focused their discussion on the transactions, code sets and identifiers section of the Act.
The committee also weathered the Administration’s harsh criticism of their bill. Secretary of Administration Charlie Smith stated that the Administration supports the concept of universal access, but feels that we are turning the entire system "upside down" to address the 10% of Vermonters that are uninsured. The Administration is opposed to a single payer, tax financed, rationed health care system. The administration feels that the draft bill is silent on many large issues and that there needs to be clear positions on policy issues.
Four areas of specific concern addressed by Secretary Smith include:
The committee also heard from Deputy Commissioner of Banking, Insurance, Securities and Health Care Administration Paulette Thabault. Thabault’s remarks focused on the Governor's health reform plan including: the Global Commitment, Vermont Blueprint For Health and employee sponsored initiative. Thabault discussed Act 53 and the pieces involved in that including: the HRAP, community needs assessments and reports cards and how useful these tools are. Thabault stated that there are many good things occurring and we need to continue to focus on those initiatives. She also stated that the governance section of the proposal calls for another layer of state agencies over an existing layer. The governance structure proposed will increase costs significantly because you will need the current staff in addition to what is proposed in the bill. Hospitals are already highly regulated and instituting a Public Service Board model is not needed. Thabault urged the committee to be thoughtful, work slow and concentrate on the Medicaid deficit.
This week was a reality check for the committee and politics is definitely driving the process. The Administration and the committee remain at opposite ends of the health reform spectrum. The committee appears resolved however, to forge ahead.
What the committee will likely adopt for now is a new regulatory scheme, including a Department of Health Care Administration that would have an office of quality and divisions of regulation, purchasing and planning and analysis. They would like to adopt a Health Care Regulatory Board, much like the Public Service Board for utilities, which would be responsible for provider and beneficiary appeals, hospital budget approvals, CON approvals, reimbursement mechanisms and rate approvals. Expect significant changes in this draft bill as the House Health Care committee prepares to report this bill out. From there, this bill’s future remains unclear, since parts of this bill may need to be taken up by other committees.
Program of All-Inclusive Care for the Elderly (PACE)
The House Health Care committee received an overview of the PACE program from Betsy Davis, PACE coordinator for Vermont (Betsy is also a FAHC trustee and VAHHS Board member). PACE combines the services of an adult day program, primary care clinic and rehabilitation services in one location. PACE is distinct from other home and community-based services because all levels of care are managed across all settings. Research has shown that PACE participants have few hospital and nursing home admissions, utilize few medications and high satisfaction. Two projects are slated to begin in Rutland and Chittenden counties. The Governor supports PACE and has earmarked funds in the OVHA budget for 2006. PACE receives funding from several other different sources as well.
Mental Health
The House Human Services took testimony on the H. 404, An Act Relating to Access to Mental Health and Substance Abuse Providers and H. 411, An Act Relating to Mental Health Parity. These bills address access to treatment for mental health and substance abuse treatment. The bill expands the network of providers that would be covered under a health benefit plan as long as the provider is willing to meet the conditions of participation established by the health insurer. The insurance industry testified that the expansion will increase health care costs at a time when we are trying to constrain costs. BISHCA also testified in opposition of the bill.
This week the Department of Corrections announced that they will seek news bids on the contract to provide mental health services in Vermont’s prisons. Concerns have been raised on the quality and costs of the services being provided currently. A draft of the request will be sent out for public comment by the end of April.
H. 163 - An Act Relating To Criminal Abuse, Neglect, and Exploitation of Vulnerable Adults
The House Judiciary Committee is finalizing its work on H. 163. One last area to be addressed is the notice provisions. The committee decided to include the entire neglect definition from Title 33 in the bill.
H. 241 – An Act Relating to Prohibition of Smoking in all Public Places
The House General, Housing and Military Affairs committee voted 7-1 to ban smoking in restaurants, bars and private clubs. There is wide support among lawmakers as a way to protect the health of workers who work in those settings. The bill will be reviewed by the House Human Services Committee and will go to the House floor early next week.
H. 518 - Capital Construction Bill
The House passed the Capital Construction Bill this week. Areas of specific important to VAHHS include the $330,000 requested by the Agency of Human Services for planning for a new 28-bed psychiatric facility with the eventual closure of the Vermont State Hospital. The Administration had requested $725,000, but the House Institutions committee lowered the amount because of the lack of a written plan. 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 passed S. 27, An Act Relating to a Safe Haven Defense to the Crime of Abandoning a Baby, on a vote of 6-0-0. The intent of the bill is to provide a procedure which ensures the safety and well-being of newborns and infants. A person who abandons or exposes a child under the age of two years, whereby the life or health of such child is endangered, shall be imprisoned not more than ten years or fined not more than $1,000.00, or both. A person will not be in violation if the person voluntarily delivers a child not more than 30 days of age to: an employee, staff member, or volunteer at a health care facility; an employee, staff member, or volunteer at a fire station, police station, or church which is being attended by a person; or to a 911 emergency responder at a location where the responder and the person have agreed to transfer the child. The committee mirrored New Hampshire’s law, which included the 911 emergency responder provision. This bill is on the notice calendar for next week.
S. 113, An Act Authorizing Nonprofit Hospitals to Convert Charitable Assets
The Senate Finance Committee finished its work on S. 113, An Act Authorizing Nonprofit Hospitals to Convert Charitable Assets, and reported the bill on the floor. The bill, as amended by the Senate Finance Committee, will require that a nonprofit hospital seek the approval of the Attorney General and the Commissioner of Banking, Insurance, Securities and Health Care Administration prior to a transfer of control of its operations to a for profit entity or a transfer of 40% or more of its assets, if valued over $1 million dollars, to a for profit entity. The bill also requires that the Attorney General be provided 20 days prior notice of any like transfer by a nonprofit hospital to a nonprofit entity. Extensive application criteria and standards for approval are established in order to ensure that charitable assets are not sold for less than fair market value or used for inappropriate private purposes. The Attorney General would also be authorized to investigate transfers of lesser amounts of assets by a nonprofit hospital to a for profit entity to consider whether these transfers met the public benefit related standards. The bill includes remedies and penalties for noncompliance.
Bills of interest introduced this week:
H. 522 – AN ACT RELATING TO NURSING PRACTICE AT THE VERMONT STATE HOSPITAL: This bill proposes to require nurses in the Vermont state hospital to meet the same standards as nurses in other facilities by repealing 26 V.S.A. § 1583(6), which exempts the work and duties of psychiatric technicians and other care attendants employed at the Vermont state hospital from the regulation of nursing practice.
S. 161 – AN ACT RELATING TO WELL CHILD CHECKUPS: This bill proposes to require health insurers to cover well child checkups consistent with a statutorily defined schedule of visits.
S. 162 - AN ACT RELATING TO COMPULSORY LICENSING OF PHARMACEUTICAL DRUGS: This bill proposes to allow the state to offer to residents pharmaceutical drugs at lower prices through the exercise of eminent domain powers.
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).