VAHHS Legislative Report

For the week ending January 20, 2006

Political Overview
On Tuesday, January 17, 2006, the Governor presented his annual budget address to the General Assembly. In keeping with his agenda of affordability, the Governor focused on key topics addressed in his State of the State that included health care reform, education, youth outreach, investment in technology and supporting economic growth. The $4.5 billion budget represents a 6% increase in state spending.

The Governor cited the Global Commitment and stressed his support for a consensus health care plan.

A total of $29 million annually in health care reforms were proposed for the FY 2007. Allocations include: $6.4 million for premium assistance and other subsidies, a $4 million annual increase for Medicaid reimbursements to family practice, internal medicine and pediatric physicians; $700,000 for Electronic Medical Records; $500,000 for other technology projects including Common Claims administration, Consumer Price and Quality Information, and multi-payer data collection; $300,000 for my Fit and Health Kids program; and $100,000 for healthy aging. The Governor stressed that all funding work within the limits of the Global Commitment and can be implemented without new taxes.

Within the area of human services, the Governor is proposing several capital investments including: $1.3 million for site and design work for a new state hospital and $750,000 for the second phase of new prison work camp, and $9 million to acquire a new site for health and forensic lab facilities.

VAHHS Issues

Health Reform

The House Health Care Committee heard testimony by Jim Hester, MVP Healthcare on the Williston Group Proposal. An overview of MVP’s activities in Pay for Performance and establishing best practice guidelines in chronic care management were provided. He highlighted that the methodology of administering pay for performance initiatives is not obvious or easily determined. Questions from the committee followed on subjects such as provider involvement in care management processes, ensuring adequate reimbursement to cover cost of care and how the care management processes at MVP have affected the cost of care.

On Thursday the committee began to look at what they would like to see in their reform bill. The overall goal/vision is that everybody will be covered and focus on the uninsured, everybody pays as they are able and bending the cost curve. Ways to accomplish the goal include: information technology for physicians, chronic care, addressing the cost shift and “tracking” the savings, increasing provider capacity and hospital pilot programs for Medicaid global budgets. The committee plans to draft a bill that is leaner than last year’s, straight forward and uncomplicated.

Bea Grause and Mike Del Trecco testified on Thursday with BCBS and CIGNA scheduled to testify on Friday afternoon. The committee is focused on determining how these proposed sections will help create system-wide improvements. They plan on marking-up these sections of the bill within two weeks.

Prescription Drug Monitoring

The Senate passed S. 90, the prescription drug monitoring bill. This bill has been referred to the House Human Services Committee.

S. 198, Act Relating to Reporting Medical Errors and Establishing a Sorry Works Program

Senate Judiciary heard extensive testimony from the attorney trade groups, Vermont Department of Health, VAHHS and BISHCA. There was general support for the concepts of safe apology and Sorry Works among all those who testified, but there was some disagreement on the details. Trade groups representing attorneys wanted to insure that the safe apology protections did not extend to the complete medical record. They also wanted access to the root cause analysis materials referenced in the Sorry Works section of the bill. The committee heard consistent testimony that the safe apology language as drafted did not cover a wide enough scope of practitioners and did not apply to hospitals. VAHHS supported the language from Colorado already under consideration by the committee. Senator Sears said that the language proposed in the bill and the Colorado language represented two ends of the spectrum in terms of breadth of protection. The Committee also heard consistent testimony that the section requiring notifying patients of errors did not contain protection against disclosure. The committee also spent a lot of time discussing which pieces of S. 198 are more related to the concept of an adverse event reporting system and which are relevant to Sorry Works. They are considering removing those sections of the bill and considering adverse event reporting in Senate Health and Welfare. VAHHS, BISHCA and VDH all supported working through those issues separately. The committee will be accepting draft language from the various interested parties and will take up the bill again on January 31 and February 1. Jill Olson from VAHHS testified in support of the Colorado safe apology language, against the requirement to notify patients of errors in writing and in support of a voluntary Sorry Works program. She also testified that the adverse event components of the bill should be removed because they are separate issues.

Staffing Ratios
House Human services took up staffing ratios on Friday afternoon. The committee took testimony from Jennifer Henry and Susan Lucas, representing “Justice for Health Care Workers,” Linda Minsinger, CNO at Gifford Medical Center, Mary Shriver from the Vermont Health Care Association and Jill Olson from VAHHS. Testimony centered on a new draft bill circulated by Representative Donahue. The new draft did not substantially change the section directing BISHCA to consider staffing levels as part of the Act 53 report. The daily posting by shift by unit was changed to require posting of “maximum patient census” and nurse FTEs rather than that ratios required by version of the bill previously under consideration. Advocates for the bill testified in favor of the change and said it represented an effort to reduce the burden on hospitals. Linda Minsinger testified about her continued concerns about the administrative burden on staff and talked about how concerns raised about staffing by patients and families are handled at Gifford Medical Center. She also questioned how the information would be useful to patients. Mary Shriver described the reporting system already used by the nursing home system as administratively burdensome and complex. Jill Olson of VAHHS testified against the bill, saying that even the new draft still inappropriately placed emphasis on staffing numbers as a measure of quality of care, even though they are not. She said she could not see that the administrative burden of reporting would have any meaningful result.

Medical Practice
Senate Finance took testimony on the insurance provisions of the medical malpractice report. The committee heard from VAHHS, BISHCA, Vermont Medical Society, Vermont Bar Association and the Vermont Trial Lawyers Association. Bea Grause testified that the VAHHS Board considered the idea of captive insurance at the Association’s June 2005 board meeting. She stated that while the Association is happy to discuss new legislative ideas on captive insurance, the Association was not in a position to independently take on this considerable endeavor.

Tom Sherrer of the Vermont Trial Lawyers emphasized that the committee needs to make decisions according to facts, rather than anecdotes. He pointed to a "major carrier" that was permitted a rate increase by BISHCA, while stating on their website that the high costs of 2004 were an aberration and not a true reflection of rising costs/loss experience. He strongly disagreed with the hospitals' assertion that rising premiums were driving up costs, stating that premiums account for only 1% of health care costs. The problem, he said, is not the civil justice system.

Program for All Inclusive Care for the Elderly (PACE)

The House passed H. 567, An Act Relating to Exemption from certificate of need (CON) and Health Maintenance Organization (HMO) Requirements for PACE. This bill is now in the Senate.

Bill of Interest Introduced

H. 644 - AN ACT RELATING TO THE CONTINUATION OF THE MENTAL HEALTH OVERSIGHT COMMITTEE: This bill proposes to continue the mental health oversight committee until July 1, 2011.

H. 649 - AN ACT RELATING TO HEALTH CARE SYSTEM REFORM: This bill proposes to: (1) assign accountability for the coordination of Vermont’s health care system reform initiatives to the secretary of administration; (2) require greater standardization in claims administration; (3) establish a consumer price and quality information system; (4) enhance the multi-payer data collection project; (5) engage in a Medicaid enrollment initiative; (6) establish a process for reducing the Medicaid cost shift; (7) authorize healthy choices insurance discounts; (8) authorize public health initiatives in the department of health and the department of disabilities, aging, and independent living; (9) provide that an expression of apology by a health care provider does not constitute an admission of liability; and (10) authorize the department of health to establish an adverse event reporting system.

H. 663 - AN ACT RELATING TO CIGARETTE AND TOBACCO PRODUCTS TAX RATE INCREASES: This bill proposes to increase the cigarette and tobacco products tax rates.

H. 674 - AN ACT RELATING TO THE HEALTH ACCESS OVERSIGHT COMMITTEE: This bill proposes to clarify, redefine, and codify the authority and functions of the health access oversight committee.

H. 678 - AN ACT RELATING TO THE DEPARTMENT OF BANKING, INSURANCE, SECURITIES, AND HEALTH CARE ADMINISTRATION: This bill proposes to: (1) specifically require written contracts between reinsurance brokers and insurers; (2) increase financial responsibility requirements of service contract companies; (3) simplify the formation of an association captive by removing the requirement that the association be in business for one year prior to licensing; (4) allow the formation of a sponsored captive insurance company as a nonprofit corporation or a limited liability company; (5) expand the type of companies eligible to sponsor captive insurance companies; (6) standardize the procedure for service of process on HMOs; (7) eliminate redundant filings with the secretary of state by foreign or alien insurers already licensed by the commissioner to do insurance business in the state; and (8) correct errata in the Revised Uniform Securities Act.

H. 680 - AN ACT RELATING TO NURSING HOME REIMBURSEMENT FROM MEDICAID: This bill proposes to create a nursing home reimbursement system which ensures sufficient compensation for nursing homes considering the demographics and population of the location and to create incentives for nursing homes to achieve the appropriate mixture of home- and community‑based services and nursing home services.

S. 287 - AN ACT RELATING TO CIGARETTE AND TOBACCO PRODUCTS TAX RATE INCREASES: This bill proposes to increase the cigarette and tobacco products tax rates.

S. 288 - AN ACT RELATING TO FAIR HOSPITAL RATES FOR VICTIMS OF VIOLENCE: This bill proposes to ensure that the state’s victims’ compensation program pays equivalent hospital rates to those which private insurers pay.

S. 290 - AN ACT RELATING TO EMERGENCY MANAGEMENT AND PUBLIC SAFETY: This bill proposes to improve emergency management procedures in Vermont.

S. 293 - AN ACT RELATING TO ESSENTIAL SUPPORT SERVICES FOR INDIVIDUALS WITH DEVELOPMENTAL DISABILITIES: This bill proposes to ensure that individuals with developmental disabilities have essential support services after completion of high school.

S. 295 - AN ACT RELATING TO NURSING HOME REIMBURSEMENT FROM MEDICAID: This bill proposes to create a nursing home reimbursement system which ensures sufficient compensation for nursing homes, considering the demographics and population of the location and to create incentives for nursing homes to achieve the appropriate mixture of home- and community‑based services and nursing home services.

S. 298 - AN ACT RELATING TO WHISTLEBLOWER PROTECTION FOR VERMONT EMPLOYEES: This bill proposes to provide whistleblower protection to all employees in Vermont.