VAHHS Legislative Report

For the week ending January 26, 2007

Political Overview
On Tuesday, January 23, the Governor presented his annual budget address to the General Assembly. In keeping with his agenda of Vermont Way Forward, the Governor focused on key topics addressed in his State of the State that included the growing burden of property tax, affordable housing, affordable health care, education, job creation, environmental leadership, improvement of the foster care system, and Vermont becoming the nation’s first “e-state”. The $4.7 billion budget represents a 3.16% increase in general funds and a transportation budget increase of 2.6%. The Governor’s recommendations limit the increase to inflation plus population growth with a proposal that the legislature enact a cap on future budget growth.

Democratic leadership voiced concerns regarding lack of details on a strategy to deal with the challenges with roads & bridges, school construction and projected Medicaid deficit. The other controversial area was centered on the “waterfall” section of in the budget. These surplus revenues are often used as a wish list for lawmakers. Douglas proposed investing excess funds in a reserve account for construction of a new Vermont state hospital.

The Governor’s proposed SFY 2008 budget indicated an increase of $7.3 million in funding for hospitals and doctors. The $7.3 million is accounting for changes made in SFY 2007 that will carry forward into SFY 2008 plus the proposed changes for SFY 2008. For hospitals effective SFY 2008 (July 1, 2007) there is $2.0 million in proposed new money for hospital rate increases. Recognizing that starting on July 1, 2007 (SFY 2008) hospitals will also receive the full 12-month benefit of the SFY 2007 rate increase that was put into effect on January 1, 2007. The SFY 2007 increase from January 1, 2007 – June 30, 2007 equaled approximately $1 million to hospitals. On a go forward basis, the 12 month benefit of this increase is $2.0 million. The combined effect of the SFY 2007 and the proposed SFY 2008 increases equal a total of $3 million in higher reimbursement from current SFY 2007 levels. The Governor also included $4.7 million for Outreach and Enrollment for Catamount Health, continued funding for the Blueprint for Health, and oral health initiatives totaling $815,000.

Health Care Reform
Dr. Ken Thorpe, consultant to the Health Care Commission, testified in a joint hearing of the House Health Care and Senate Health & Welfare committees. Dr. Thorpe stated that he has never worked on anything that actually passed. Thorpe stated that lawmakers need to look at the Blueprint Implementation Plan to be sure that the timelines are being met and that it is meeting legislative intent. Doug Racine, Chair of the Senate Health & Welfare, asked if there needed to be aggressive oversight by the legislature on implementation of Catamount Health to which Dr. Thorpe responded yes. There also needs to be a clear and articulated plan on how enrollment will be done. (Governor has allocated $4.7 million for Outreach and Enrollment efforts as stated above and a report has been submitted to the General Assembly with recommendations on how to move forward with this). Representative Patty O’Donnell (R-Vernon), stated that there are a lot of individuals that are eligible for public assistance that do not sign up because of the stigma of being on public assistance. She stated there needs to be an effort to disconnect Catamount Health from VHAP and Dr. Dynasaur.

Dr. Thorpe stated to help primary care physicians get on board they need to be helped financially through the state budget. There also needs to be a change in the way they are paid for services, bundling of like patients (pool care) and financial assistance for technology.

Senator Kevin Mullin (R – Rutland) stated that the $7.3 million for funding to providers in the Governor’s budget address amounted to less than two and half percent, not even an inflationary increase. Senator Mullin challenged the chairs of both committees to have Joint Fiscal do an analysis of the budgeting, whether it meets the intent of the legislation passed and actually does anything to reduce the cost shift.

The House Health Care Committee took additional testimony on seasonal workers as defined under the employer assessment provision of Act 191. The first reporting period for the assessment begins in April 2007. The Committee is working to balance the need for revenue, with the hardships that will be borne by businesses that employ seasonal workers. The Committee has looked at three alternatives: 1) completely exclude all short-term employees from the employer contribution, which would create an estimated revenue loss of $1.1 million. 2) Include all short-term employees in the employer contribution and therefore not lose any revenue. 3) Include short-term employees but also have an opt-out provision for seasonal workers who have private insurance elsewhere, which would create an estimated revenue loss of $400,000. The committee is leaning towards option 2 as recommended by the workgroup.

House Health Care had the major health plans (Cigna, MVP and Blue Cross) to update the committee on private insurance efforts to integrate chronic care and Blueprint efforts into benefit plans.

The committee expects to receive the Technical Amendments Bill for Act 191 early next week. Chairman Steve Maier plans to begin reviewing and receiving testimony on Tuesday with the hope of voting out the bill by next Friday, February 2.

Fee Bill
The House Ways and Means Committee continued work on the executive branch fees bill. The committee heard from Sharon Moffat, Interim Commissioner of the Vermont Department of Health, on the their proposed fee increases for x-ray inspections, language to sustain the licensing fees for hospitals and per bed fee, and provider fees for podiatrists, physicians, physician assistants and anesthesiologist assistants.

As was reported last week the nursing home per bed tax is proposed to increase to $4322.90 starting on July 1 to bring the tax to the 6% allowable limit through December 31, 2007. Beginning on January 1, 2008, the per-bed tax will decrease to $3,962.66 to bring the tax to the 5.5% of gross revenues. Vermont Health Care Association Director Mary Shriver asked the committee to defer payment of the first installment until August 07 to allow nursing homes time to fund the additional burden.

Medicaid Deficit Study
Representative Mark Larson of House Appropriations and Steve Kappel of Joint Fiscal presented to the House Health Care Committee the Medicaid Deficit Study authorized under Section 112 of Appropriations bill of last year. The committee recommends developing new ways of looking at Medicaid spending, developing better data systems and reporting mechanisms, focus on cost-control strategies that bend the curve, expedite a statewide plan for chronic care delivery and payment changes, promote strategies to reduce the prevalence of chronic disease, monitor financial pressures within the Medicaid long term care system, increase administration coordination and integration in Medicaid, maximize Medicaid’s reliance on predictable funding sources (minimize use of one-time funds), and dedicate all new revenue under the master settlement agreement to Medicaid.

Vermont State Hospital (VSH)
The Senate Institutions and Health & Welfare committees held a joint hearing on the Vermont State Hospital. The Committee asked that the focus of the testimony center on where we are and where we are going and the link between corrections and VSH. Interim Health Commissioner Sharon Moffat and Project Manager Beth Tanzman gave updates on the Public Oversight Commission recommendations on the conceptual Certificate of Need application, the Department of Justice findings and current negotiations. Many of the committee members present expressed concern that there is a preconceived notion that Fletcher Allen Health Care is the only viable option for a new state hospital and the most costly. The members also expressed dismay that VDH has not been doing work on the planning prior to receiving the conceptual CON (this cannot be done, but clearly was not understood by the committee.) Senator Dick Sears (D-Bennington) stated that with the downsizing of VSH there has been an increase in the number of individuals incarcerated into corrections and he feels the state has made a huge mistake with deinstitutionalization. The members also expressed their concerns on privatizing the state hospital, who will have control over admissions and governance. Discussions will continue on this next week.

Advance Directives
The House Human Services took testimony from the VDH on Friday on advance directives. This was in follow up to last week’s testimony where the committee requested VDH submit in a writing a proposed timeline. The Committee asked that VDH formally announce the registry on Monday, January 29, 2007. The 120 days for which providers need to establish and implement protocols, and train staff, will begin on Monday. VDH recommended that implementation begin with hospitals. The committee asked for a list of hospitals that have started the process. The committee also expects weekly written updates from VDH on implementation and monthly in-person status updates. If there is an issue from the weekly written report that needs further clarification VDH and others will be asked to attend a hearing the following week. VAHHS and the Vermont Medical Society will share their concerns and implementation status to VDH to include in their report. The first report will focus on issues that need to be addressed immediately such as liability concerns, who will need to look at registry, and episode of care. This was not clearly defined in the rule.

Bills of interest that were introduced this week:
H. 92 – AN ACT RELATING TO CONFIDENTIALITY OF PRESCRIPTION INFORMATION: This bill proposes to ensure confidentiality of patient prescription records and prevent the use of this information for commercial purposes.

H. 110 – AN ACT RELATING TO COMPLAINTS BEFORE THE VERMONT STATE BOARD OF NURSING: This bill proposes to improve the process whereby the Vermont state board of nursing investigates complaints by requiring the board to: (1) give due consideration to the testimony of the complainant; (2) provide the complainant an opportunity to refute the testimony of the respondent; (3) provide the complainant a list of all persons interviewed by an investigator; and (4) provide the complainant with a copy of any recommended stipulation and consent agreement.

H. 112 – AN ACT RELATING TO PROTECTION OF HEALTH CARE AND PUBLIC SAFETY PERSONNEL FROM COMMUNICABLE DISEASE: This bill proposes to require informed consent in order to test for communicable and infectious diseases except in the case in which health care workers or public safety personnel have been significantly exposed to the bodily fluids of an individual suspected of possible disease infection.

H. 113 – AN ACT RELATING TO ALL-AGE ACCESS FOR TOBACCO CESSATION PROGRAMS: This bill proposes to allow youth to access and consent to state smoking cessation programs.

H. 137 – AN ACT RELATING TO THE RESTORATION OF A DEPARTMENT OF MENTAL HEALTH AND A COMMISSIONER OF MENTAL HEALTH: This bill proposes to reestablish a department of mental health and a commissioner of mental health.

H. 142 – AN ACT RELATING TO ASSAULTS ON EMERGENCY MEDICAL PERSONNEL: This bill proposes to provide enhanced criminal penalties for assaulting emergency medical personnel.

H. 153 - AN ACT RELATING TO ELIMINATION OF THE RULE PROHIBITING SMALL BUSINESSES FROM BUYING HEALTH INSURANCE UNLESS 75 percent OF EMPLOYEES ENROLL: This bill proposes to allow small businesses that offer health insurance to all full-time and part-time employees to purchase small group insurance even if less than 75 percent of the employees enroll in the employer’s plan.

S. 50 – AN ACT RELATING TO CHIROPRACTIC COVERAGE IN MEDICAID AND VHAP: This bill proposes to reinstate chiropractic coverage under the Medicaid and VHAP programs.

S. 58 – AN ACT RELATING TO THE RESTORATION OF A DEPARTMENT OF MENTAL HEALTH AND A COMMISSIONER OF MENTAL HEALTH: This bill proposes to reestablish a department of mental health and a commissioner of mental health.

Public Hearing: Fiscal Year 2008 state budget by Vermont Interactive Television Monday, February 5, 2007 from 4:15 p.m. – 5:45 p.m.

Legislative Appointments:
The Speaker announced Legislative appointments to committees and commissions as follows:

Commission on Health Care Reform
Rep. Steve Maier of Middlebury
Rep. Harry Chen of Mendon
Rep. Mark Larson of Burlington
Rep. Topper McFaun of Barre Town

Health Access Oversight Committee
Rep. Ann Pugh of South Burlington
Rep. Peter Hunt of Essex Junction
Rep. Bill Frank of Underhill
Rep. Lucy Leriche of Hardwick
Rep. Patty O’Donnell of Vernon

Mental Health Oversight Committee
Rep. Michael Fisher of Lincoln
Rep. Anne Donahue of Northfield
Rep. Mitzi Johnson of South Hero
Rep. Tom Koch of Barre City

Joint Rules Committee
Rep. Gaye Symington of Jericho
Rep. Steve Adams of Hartland
Rep. Floyd Nease of Johnson
Rep. Carolyn Partridge of Windham

Joint Fiscal Committee
Rep. Martha Heath of Westford
Rep. Don Bostic of St. Johnsbury
Rep. Michael Obuchowski of Rockingham
Rep. Shap Smith of Morristown
Rep. Richard Westman of Cambridge

Emergency Board
Rep. Martha Heath of Westford
Rep. Michael Obuchowski of Rockingham