VAHHS Legislative Report

For the week ending February 3, 2006

Political Overview
The House and Senate leadership today responded to newly-released details of the Governor’s 2007 budget, saying the budget amounts to a significant property tax increase on working Vermonters and a huge shift of health care costs to employers who already provide health care to their employees. House Speaker Gaye Symington pointed out that under the Governor's proposed budget, property taxes will increase on working Vermonters by $22 million. Analysis by the leadership indicates that approximately 66,000 Vermonters will pay an average of $335 more each in school property taxes. In addition, the Governor's health care proposal will shift $45 million in health care costs to Vermont employers who already provide health care for their employees. Symington stated the challenge is to balance our budget without raising property taxes on Vermonters and health care premiums on Vermont employers. See below for more details.

At the Governor’s weekly press conference this week, the issue of illegal aliens working on Vermont's dairy farms took center stage along with the Governors proposed scholarship program. The Governor stated that the 2000 illegal immigrants (mostly Mexicans) who work on Vermont dairy farms solve a serious labor shortage. The state is faced with the dilemma of breaking federal law by allowing Vermont farms to employee illegal immigrants or to put Vermont farms out of business. Governor Douglas acknowledged that checking their paperwork has not been a high priority for law enforcement and yet federal authorities plan to be more aggressive. The Mexican government issued government identification cards hoping that it would solve the problem, but that has not been the case.

The other hot topic is the Governor’s proposed scholarship program that would give Vermont high school graduates $1,000 per year toward the cost of attending college in the state, providing they promise to stay in Vermont for three years after receiving their degrees. The controversy stems from how the Governor plans to fund this initiative. The $13 million per year funding will be from the state's share of a national settlement against tobacco companies. Some legislators have suggested that the money would better be used to fund the troubled Medicaid programs. Douglas stated that the $13 million per year is a drop in the bucket to help ease the Medicaid deficit. Douglas stated that the scholarship program will have a bigger impact on Vermont's coming labor shortage than it would on an $800-million-per-year Medicaid program.

VAHHS Issues

Health Care Reform
House Health Care spent a large majority of the week discussing their draft health reform bill. Additional testimony regarding provider capacity and patient registries was heard from Paul Harrington of the Vermont Medical Society. Content of the bill focuses on chronic care infrastructure and management, Medicaid reimbursement as related to the cost shift and development of a health benefit plan (currently referred to as “X Health”) with financing through the Global Commitment. The benefit plan for “X Health” outlines a basic benefits package that would include a basic benefit package in addition to wellness and pay for performance initiatives. In addition, the bill calls for issuing of an RFP for chronic disease management services to be provided to Medicaid, VHAP, Dr. Dynasaur and “X Health” recipients that would provide management service to recipients with a variety of chronic conditions. Such services would be integrated with the larger Chronic Care Initiative, but would provide an opportunity to target patients in a shorter timeframe than the services provided through the statewide Chronic Care Initiative. The bill outlines a timeline to expedite the Chronic Care Initiative planning and implementation process and has identified milestones and dates including implementation of the patient registry and deadline for voluntary stakeholder participation in addition to annual status/progress reporting requirements to the general assembly. The bill also includes language describing the cost shift and the intent to raise Medicaid rates to reduce the shift and then pass on such savings to consumers.

The committee also took testimony on the Administration’s plan. Frustration was at an all time high when the committee began discussions on the basic benefit plan and the cost of the employer sponsored insurance. Last week the Administration stated that the cost to employers would be $14 million and this week the amount increased to $35 million, not including administrative costs. The House Health Care Committee estimated the amount to be anywhere from $50-60 million. Late Friday the Administration came back with a cost to employers of approximately $44 million.

Bea Grause , President of VAHHS, testified on the possibility of capitated budget pilot projects and how they would work. Grause stressed the importance of financial stability for any new pilot project and believed that if properly constructed, several hospitals would “step up to the plate.” Specific areas to be addressed include: identifying the service, population and covered lives to be managed. This could be accomplished during the negotiation process between the Office of Vermont Health Access and the hospital service area. Grause stressed that clarity on the parameters is essential. Grause also stated that the pilot should include a method for covering expenses related to disasters or catastrophic events. Assuming a multi-year pilot it should also anticipate an annual increased calculated on actual cost increases such as: labor and technology.

The committee will continue to work on the draft bill next week and hopes to vote out a bill by Thursday of next week.

The Senate Health and Welfare Committee continued taking testimony on issues related to the Common Sense Initiatives ( CSI) addressed in their bill including the Vermont Department of Health’s fit and healthy kids initiative and loan forgiveness program. Next week the committee will focus on adverse event reporting.

S. 198 – An Act Relating to Reporting Medical Errors and Establishing a Sorry Works Program
The Senate Judiciary Committee took some additional testimony on Wednesday and reviewed new drafts on Wednesday and Thursday. The new draft removes those provisions of the bill as introduced that relate to internal error reporting and adverse event reporting. Adverse event reporting will be taken up by the Senate Health and Welfare Committee. The new draft extends the timeframe for a safe apology to 30 days and specifically includes health care facilities as a covered entity. The new draft has consistent definitions; most notably it uses the Veterans Affairs definition for adverse event, although in the context of this draft, the committee did agree to limit that provision to adverse events that cause death or serious disability. The new draft preserves the requirement to notify patients who have been harmed in writing, a provision which VAHHS opposes. The new draft also preserves the creation of a voluntary so-called sorry works program. So far, medical malpractice carriers have been unwilling to testify on the bill, but Senator Sears renewed his efforts to include them in the process.

On Wednesday, Dr. Robert Pezzulich of Southwestern Vermont Medical Center testified in support of the concept of the bill, but stressed that he agreed with the concerns raised by VAHHS. He also suggested that the section on notifying patients of adverse events in writing might be better debated as part of the adverse event reporting bill being developed by VAHHS, the Vermont Medical Society, Vermont Department of Health, Banking, Insurance, Securities and Health Care Administration (BISHCA) and Jeanne Keller. VAHHS and VMS argued that that provision should be debated by the Health and Welfare Committee as part of the adverse event bill in part because of concerns about jurisdiction for rule making. S. 198 would place that authority under BISHCA. Peter Taylor of the Vermont State Dental Society testified that dentists would like to be covered by the safe apology provisions of the bill. Representatives for trial attorneys suggested that the notification requirement be accompanied by a required form on which the disclosure should be made.

H. 644, An Act Relating to the Continuation of the Mental Health Oversight Committee The Senate Finance committee reviewed and referred H. 644 to the Senate Health & Welfare committee for their review . The committee recommended adding a section to the bill that will requires the mental health oversight committee to provide a progress report to each of the committees represented on the oversight committee by January 15 of each year. The bill continues the Mental Health Oversight Committee until July 1, 2011.

2005 Budget Adjustment
The Senate Appropriations passed the FY2005 budget adjustments on Tuesday. The committee concurred that psychiatric hospitals would be exempt from the reductions in the Medicaid reimbursement rate with an adjustment in FY2006 to compensate for the reduction. The full Senate passed the budget adjustment on Friday and the bill as been sent back to the House. If the House concurs with the Senate changes the bill will go to the Governor for his signature. If the House does not concur, a conference committee will be appointed.

Capital Bill - Vermont State Hospital
The House Institutions Committee took up the Vermont State Hospital portion of the Capital Bill on Friday. Tasha Wallis, Commissioner of the Department of Buildings & General Services, stated that they are seeking $1,350,000 for permitting, legal and architectural fees to get the project moving forward. Meg O’Donnell, Director of Government Relations and Assistant General Counsel at Fletcher Allen Health Care (FAHC), stated that Fletcher Allen leaders met with Beth Tanzman and a team from the Vermont Department of Health and Tasha Wallis's team on January 10 to begin a discussion about locating new inpatient psychiatry units on or near the Fletcher Allen campus. It was a very good discussion with two primary outcomes. First, it was an opportunity to introduce key people at FAHC, the Division of Mental Health, and Buildings and General Services to each other. Second, it provided an opportunity to outline the issues and tasks ahead of us in the planning process. There was an extensive discussion of the constraints on any new building projects on the FAHC campus, such as zoning and city regulations. FAHC has identified a core team within that brings architectural, space planning, program, and regulatory expertise to the process. Tanzman has also identified a core team from the state that has corresponding expertise. FAHC has also established a Burlington Futures Group to help facilitate communication with local partners and neighbors. The state will lead this process overall. All processes will be conducted with community input. The committee will continue to take testimony on this issue.

Staffing Ratios

The House passed H. 227 on the floor last week. This bill has been referred to the Senate Health & Welfare Committee.

H. 258, An Act Relating to the Disclosure of Rates of Hospital-Acquired Infections

The Committee on Human Services took testimony this week on S 258. They heard testimony from Pat Jones, director of quality assurance and consumer protection at the Vermont Department of Banking, Insurance, Securities and Health Care Administration (BISHCA). She led a committee of stakeholders that produced a recommendation letter to the Committee on Human Services at the request of Representative Ann Pugh. She described the process the Act 53 special subcommittee went through to arrive at its recommendations, including seeking input from the Vermont Program for Quality in Health Care (VPQHC), the Centers for Disease Control (CDC) and other states that are working on infection reporting. She also described the key recommendations of the committee, including the importance of not listing specific measures in statute and the need for a funded coordinating body. Jill Olson of VAHHS testified in support of the Act 53 subcommittee’s recommendations, as did Gene Cenci, a consumer. Margaret Luce of the Vermont State Nurses Association and Gail Zatz representing Justice for Health Care Workers were asked to comment from their seats. Both supported the recommendations of the letter and the work of the special Act 53 subcommittee.

The committee on Human Services focused on two issues: (1) they would like VAHHS to propose language that would specifically include infection reporting in the Act 53 report without specifying exactly which measures and (2) they would like BISHCA to propose how much funding they need to coordinate the reporting effort.

The committee heard from BISHCA Commissioner John Crowley on Friday regarding funding. Commissioner Crowley stated that BISHCA will not need additional funding for this program and can absorb it within their existing budget and future contract negotiation with the Vermont Program for Quality in Health Care.

VAHHS proposed language to the Act 53 process that states that measures of hospital-acquired infections are valid, reliable, and useful, including comparisons to appropriate industry benchmarks for safety. The committee also added language that a member of the public representing patient interests be added to the Act 53 subcommittee. The bill passed the Human Services committee on an 10-0-1 vote. It will be debated on the House floor next Wednesday.

Program for All Inclusive Care for the Elderly (PACE)

On Thursday afternoon, the Senate Finance committee passed H. 567 that would exempt PACE from Certificate of Need and Health Maintenance Organization requirements. The Senate suspended its rules to take the bill up for immediate consideration and passed the bill. It now goes to the Governor’s office for his signature.

Medicare Part D

The House Human Services will be receiving weekly updates on the Medicare Part D program. State officials stated that Vermont will continue to pay for prescription drugs even if the federal government stops reimbursing the state on February 15. The legislature in January appropriated $7 million to cover the cost. These funds will likely run out before the state is prepared to try and go back to the federal program. There is some good news. A small number of Vermonters are successfully purchasing their drugs through the federal program. Even if things are resolved in two weeks, pharmacists, state officials and consumer advocates will need at least two weeks to transition.

2007 State Budget
The House Appropriations committee will begin its review of the Agency of Human Services and Medicaid budgets next week.

House and Senate Appropriations Committee - Joint Public Hearing on Fiscal Year 2007 Budget on Vermont Interactive Television
Monday, February 13, 2006, 5:00 to 7:30 p.m. – The House and Senate Appropriations Committees will hold a joint public hearing on Vermont Interactive Television (V.I.T.) to give Vermonters throughout the state an opportunity to express their views about the State budget for fiscal year 2007. All V.I.T. sites will be available for the hearing: Bennington, Brattleboro, Castleton, Johnson, Lyndon, Middlebury, Newport, Randolph, Rutland, Springfield, St. Albans, Waterbury, White River Junction, and Williston. The V.I.T. web site has an up-to-date location listing, including driving directions and telephone numbers: www.vitlink.org11-0-0

For further information about the format of this event, call the House Appropriations Committee office at 802/828-2251. Requests for interpreters should be made to the office no later than 4:00 p.m. on Friday, February 3.

Bill of Interest Introduced this Week

H. 750 – AN ACT RELATING TO ADMISSIONS TO DESIGNATED MENTAL HEALTH HOSPITALS (Representatives Donahue of Northfield, Errecart of Shelburne and Pillsbury of Brattleboro): This bill proposes to clarify the ability of children under 14 years of age to consent to voluntary admission into a designated mental health facility, to establish a clear process for voluntary admissions for children under 14, to require release of a patient after a 72‑hour hold if the designated hospital has not sought an involuntary admission, and to require a preliminary hearing after a 72‑hour hold.

H. 752 - AN ACT RELATING TO VULNERABLE ADULTS (Representatives Smith of New Haven, Clark of Vergennes and Houston of Ferrisburgh): This bill proposes to establish that a caregiver can commit the crime of neglect of a vulnerable adult whether or not the caregiver is acting pursuant to the vulnerable adult’s wishes.

H. 764 – AN ACT RELATING TO ESSENTIAL SUPPORT SERVICES FOR INDIVIDUALS WITH DEVELOPMENTAL DISABILITIES (Representatives Klein of East Montpelier, French of Randolph and Pugh of S. Burlington): This bill proposes to ensure that individuals with developmental disabilities have essential support services after completion of high school.

H. 781 - AN ACT RELATING TO THE PERSONAL NEEDS ALLOWANCE FOR LOW INCOME INDIVIDUALS IN NURSING HOMES, RESIDENTIAL CARE HOMES, OR ASSISTED LIVING RESIDENCES (Representatives Kiss of Burlington and Haas of Rochester): This bill proposes to include an annual inflation adjustment for the personal needs allowance received by individuals eligible for Supplemental Security Income or Medicaid and residing in a nursing home, a residential care home, or an assisted living residence.

H. 792 - AN ACT RELATING TO THE PROTECTION OF PERSONAL INFORMATION (Representatives Atkins of Winooski and Marcotte of Coventry): This bill proposes to require any data collector of personal information of a Vermont resident to disclose to an individual if there was an unauthorized acquisition or access to the individual’s personal information that the collector owns or is using. Notice would not be required if the data collector establishes that the misuse of the personal information is not reasonably possible and the data collector so notifies the attorney general or the department of banking, insurance, securities, and health care administration. The bill would exempt certain financial institutions subject to existing guidance from the notice requirements. The attorney general would have authority to investigate and prosecute violations. The bill would also prohibit business or state agency use of an individual’s Social Security number, but would allow several exemptions for specific uses. In addition, the bill would require any business in the state that maintains or otherwise possesses personal information of Vermont residents to take all reasonable measures to destroy or arrange for the destruction of a customer’s records containing personal information.

H. 796 - AN ACT RELATING TO LEGISLATIVE APPROVAL OF AND OVERSIGHT OVER MEDICAID WAIVERS (Representative Pugh of S. Burlington): This bill proposes to codify the existing requirements for legislative approval of and oversight over Medicaid waivers.

H. 797 - AN ACT RELATING TO A HEALTH CARE EDUCATION PROGRAM (Representative Masland of Thetford): This bill proposes to establish a Vermont health care education program within the department of health to coordinate state and private health education programs.

H. 799 - AN ACT RELATING TO RESPITE CARE FOR CHILDREN WITH SPECIAL HEALTH CARE NEEDS (Representatives Pugh of S. Burlington, Frank of Underhill, French of Randolph and Klein of East Montpelier): This bill proposes to increase the funding for the department of health’s respite care program for children with special health care needs to allow respite care payment amounts at a level equivalent to those paid through the flexible family program provided by the department of disabilities, aging, and independent living.

H. 800 - AN ACT RELATING TO PHARMACEUTICAL DRUGS FOR USE BY FREE HEALTH CARE CLINICS (Representative Chen of Mendon): This bill proposes to create a pharmaceutical drug program for free health clinics to provide prescriptions funded by a fee on pharmaceutical marketers.

H. 805 - AN ACT RELATING TO HEALTH INSURANCE AFFORDABILITY (Representatives Koch of Barre Town, Keogh of Burlington and McFaun of Barre Town): This bill proposes to (1) develop a loan fund for health care information technology; (2) require insurance carriers to reward consumers for finding billing errors; (3) mandate individual health insurance, proof of which must be shown to obtain a driver’s license, state tax refund, or hunting or fishing license; (4) require the development of an affordable, basic benefit plan; (5) provide premium assistance for individuals who are eligible for VHAP or Dr. Dynasaur to purchase health insurance in the private market; (6) establish a tax credit for small businesses that begin providing employee health insurance; (7) raise Medicaid provider payment to the level of Medicare payment; (8) establish state funding to reinsure a band of chronic care costs; (9) make compliance with evidence-based practice an affirmative defense to medical malpractice and require arbitration in medical malpractice cases; (10) provide seed money for establishment of primary care clinics in the proximity of hospital emergency rooms to operate 24 hours a day and reduce nonemergency care in hospitals; (11) require one-half of all punitive damages in medical malpractice claims to be deposited into the health access trust fund; (12) tax beer, candy, and soft drinks; (13) increase the cigarette tax to $2.00 per pack; and (14) make appropriations for these programs.

H. 827- AN ACT RELATING TO A SCREENING PANEL FOR MEDICAL INJURY CLAIMS (Chen of Mendon): This bill would establish screening panels for medical injury claims.

H. 835 - AN ACT RELATING TO IMPROVIDENT TRANSFERS OF PROPERTY BY A VULNERABLE ADULT (Obuchowski of Rockingham): This bill proposes to create a civil action for the improvident transfer of property by a vulnerable adult.

H. 837 - AN ACT RELATING TO THE PRACTICE OF ACUPUNCTURE (Representative Milkey of Brattleboro): This bill proposes to require professionals who practice acupuncture to demonstrate a certain level of training.

H. 842 - AN ACT RELATING TO TRANSPARENCY IN HOSPITAL RATES (Representatives Condon of Colchester, Canfield of Fair Haven, McFaun of Barre Town, Reese of Pomfret and Shand of Weathersfield): This bill proposes to require hospitals to post the average rates charged to private insurers, Medicare, and the uninsured for the 20 most common procedures and dispensed medications.