Board Approves Vt. Hospital Budgets

Valley News Staff Writer
Published: 9/29/2017 11:45:13 PM

White River Junction — The Green Mountain Care Board this month completed one of its primary responsibilities in Vermont’s effort to curb the growth of health care spending by approving hospital budgets for the 2018 fiscal year, which begins on Sunday.

In the budgets, the board held the state’s 14 hospitals to a 3 percent increase in net patient revenue over those approved for the 2017 fiscal year. Net patient revenue — which includes health care payments from patients and insurers, but does not include other hospital revenue such as food service or philanthropy — is a key indicator of changes in health care spending.

“I was pleased to see that many of the hospitals’ budget submissions were below our requested net patient revenue cap, while also making investments that will improve the quality of care for patients,” the board’s chairman, Kevin Mullin, said in a news release earlier this month.

The board reviews hospital budgets according to state statute with an eye toward improving the health of the population, reducing per capita rate growth in health care spending, maintaining access to care and a high quality of care, employing high quality providers and simplifying administrative services, according to the budget orders the board filed this week.

In the Upper Valley, the board approved net patient revenue increases of about 3 percent for Gifford Medical Center in Randolph, 2 percent for Mt. Ascutney Hospital and Health Center in Windsor and 0.4 percent for Springfield (Vt.) Hospital.

The board also approved total spending of $59.8 million for Springfield, up about 1 percent from 2017; $59 million for Gifford, up about 2 percent; and $52.9 million for Mt. Ascutney, also up about 2 percent.

In terms of operating margins, Gifford anticipates ending fiscal year 2018 with a 2.2 percent gain, while Springfield anticipates a 1.7 percent gain and Mt. Ascutney, a Dartmouth-Hitchcock affiliate, anticipates a 2.3 percent loss.

Gifford’s anticipated positive operating margin is expected to come following a loss in 2017, which resulted from surgical vacancies, the hospital’s chief executive Dan Bennett told the board at an August hearing.

In the meantime, Mt. Ascutney officials told the board that they expect their loss in 2018 to be balanced by a “system allocation” from Dartmouth-Hitchcock.

All three hospitals anticipate reductions in Medicaid “disproportionate share hospital” (DSH) payments, which are intended to offset uncompensated costs such as those associated with serving uninsured patients or the shortfall of costs not paid by the Department of Vermont Health Access or the Centers for Medicare and Medicaid Services. This is a result of a change the Vermont Legislature made last session because the free care that hospitals provide has been reduced through the Affordable Care Act and Medicaid expansion.

In the August presentations to the board, Upper Valley hospital officials also addressed the board’s questions relating to health care quality and access issues, describing a range of efforts in areas such as mental health, oral health, substance use, transportation, housing and food.

The release makes clear that the board’s work to curb health care spending, access and quality continues.

“While this year’s increases continue the trend of historically low growth, I believe there is much still to do to make health care more affordable and accessible for Vermonters, and to continue to improve the quality of care Vermonters receive at our hospitals,” Mullin said in the board’s release.

The board’s efforts to control costs also include adjusting commercial insurance rate increases to reflect the slowed growth of hospital budgets, according to the release.

In August, the board approved rate increases for MVP and Blue Cross Blue Shield of Vermont plans offered through Vermont Health Connect, the state’s exchange, well below the rates requested by the insurers.

Blue Cross Blue Shield, which insures more than 70,000 Vermonters through the exchange, requested a 12.7 percent average annual rate increase beginning Jan. 1, 2018, but the board granted an increase of 9.2 percent. And, MVP, which insures more than 10,000 Vermonters through the exchange, had requested an increase of 6.7 percent for those plans, but the board granted an increase of 3.5 percent.

These premium increases, the board noted in its release, are “well below the double-digit rate growth many other states are facing.”

Nora Doyle-Burr can be reached at or 603-727-3213.

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