Wednesday, December 10, 2014

Looking Ahead: Health Care in the News

For the next several weeks before the new legislative session begins, we are likely to see a great deal of media attention and public reaction to developments in Vermont’s efforts at universal health care planning.

Two major announcements are due out: what the administration will propose as a benefit package (what gets covered and what percentage of costs are covered), and then, how it will propose to shift financing from privately paid premiums to a tax-based system.

Neither of those will be the last word, since they must receive the sign-off of the Green Mountain Care Board and/or the legislature before moving forward to next steps, but they will certainly set the tone for the discussion.

What is notable is how many critical issues are not even in the public eye at all. I would like touch on a few of those lesser-highlighted subjects.

On a recent Mark Johnson radio program, a caller asked about how long term care would be integrated into the universal access plan, including the option of home health supports in lieu of nursing home care. The guest on the show did not know.

The answer: it won’t be, apart from our existing Medicaid program. Although our need for long term care will be increasing significantly as our population ages, this is not considered as part of current “health care” coverage. It isn’t covered by private health plans or Medicare.

Unless you are one of the few who has purchased a separate long term care insurance policy, you will learn the hard way, as many families do, that you must spend down most of your life savings before becoming eligible for coverage under Medicaid. Act 48 told the Green Mountain Care Board to look at including long term care, but this would be a cost massively beyond all current conversation and not eligible for any federal support.

There are current advertisements promoting a universal plan on the basis that it will eliminate insurance companies from meddling with what doctors think is best for patients, and that it will mean “everybody is in,” in a fully equitable system.

Actually, the current insurance company role of managing care will simply be assumed by a different body, just as it is now for the state-run managed care entity that manages Medicaid (the Department of Vermont Health Access.) Although in theory any benefit revisions will be determined by the GMC board, those decisions will be controlled by the money available, which will be determined by the legislature in setting the annual budget.

The degree to which “everybody is in” will impact whether the plan will be legally, politically and fiscally viable, because some groups can’t be forced in, and others won’t want to be. Large companies that self-insure (about 20% of the Vermont market) can’t be, under federal law (ERISA); Medicare beneficiaries who buy their own secondary coverage (“Medigap”) may not want to have that coverage taken over by GMC; unions won’t want to lose the current level of benefits; and the list goes on.

Obviously those who do not want Green Mountain Care coverage will not want to pay a tax to finance it.

The most recent data (2012) provides this breakdown of insurance categories among Vermonters: Medicare, 16%; Medicaid, 18%; public employee plans, 13%; private insurance, 44%; military coverage, 2% and uninsured, 7%. Public employees are made up primarily by teachers (8%) and state employees (5%); private insurance purchasers are divided among large employers (29%), small employers (11%) and individuals (4%).

Everyone has acknowledged that “there will be winners and there will be losers” under any major change. Most agree that there is a need for greater equity, but that does not necessarily mean a willingness to sacrifice to achieve it. Thus once the dust settles, a key question will be whether there are more winners or more losers, and what their respective political strength is.

 A recent comment to a VT Digger article suggested considering coverage based on how “the VSEA and the state of Vermont worked together to design the current state employees’ health plan. It’s a very high actuarial value plan and…it’s been the best plan out there.”

What is its relative cost? The administration has presented a profile that shows three scenarios for the current cost of coverage for a single parent with two kids. If one includes the average out-of-pocket costs for each in order to compare the theoretical full cost of the actuarially-equivalent product, then that coverage is about $13,000 if purchased on the exchange; $19,000 for a company with just a few more than 50 employees (small pool); and $27,000 for state employees.

That would not be remotely sustainable as the Green Mountain Care product. Will the VSEA surrender its plan in order that all residents in a Vermont-universal plan will be receiving the same coverage, based upon ability to pay? If not, how is that a universal program in which “everyone is in” and treated equitably? No group will be required to be limited to Green Mountain Care; anyone will be able to buy supplemental coverage as long as they are willing to pay extra.

Note that plans with a high actuarial value drive costs because they fail to promote responsible use – one of the reasons the administration gave me for why the VSEA plan costs the state so much.

Medicaid has an actuarial value of 99%. The VSEA plan is at 94%. A “platinum plan” on the health exchange is about 87%, and a “gold plan” is 80%. Slightly more than half of Vermonters currently have a 90% or better plan, while slightly under a third have a less than 80% value plan.

So how many win, and how many lose, if Green Mountain Care is at 80%, as Act 48 requires as a minimum? Or at 87%, which Act 48 describes as its intent?

Another critical aspect receiving little attention is the federal tax for such high-value health plans, a cost which must be considered in developing the Green Mountain Care package and financing. It is part of the federal Affordable Care Act’s mechanism to help pay for its costs.

Here are excerpts from the December Joint Fiscal report (available on line on the Joint Fiscal site) on this subject:

“The ‘Cadillac tax’ is a federal excise tax on high-value health insurance plans beginning in 2018. The 40-percent excise tax applies to the value of health benefits over a certain threshold... JFO estimates that many Vermonters, and most State employees, have insurance plans that will be subject to the tax in 2018. Some employers will likely modify their plans or shift the tax to their employees in order to prevent their costs from increasing substantially…

 “JFO estimates that the aggregate excise tax bill in Vermont could be about $9 million in 2018 and about $40 million in 2023. All individual and family plans offered to State employees in 2015 are projected to be subject to the tax in 2018, imposing a new tax of about $6.8 million on the State government or its employees in the absence of changes in plan choice and design.”

Another missing part of the discussion is that there are other aspects of any potential proposal that are completely controlled by the Affordable Care Act itself. In order to get a waiver from the law (which must happen, otherwise we would lose all of the federal money that our entire health system depends upon), a number of conditions must be met.

These include the fact that there can be no reductions from the scope of the benefits required on the health care exchange, and that there can be no negative impact on the federal budget… in other words, it can’t draw any more federal money than what we get under the ACA.

It is the influence and constraints of federal law and money that has convinced me from the start that no state can succeed with a “go-it-alone” plan for completely reshaping health care delivery and creating government financing mechanisms. Even if Vermonters developed a common vision of what comprehensive reform might look like, we can’t fly it ourselves.

That’s regrettable, because waiting for national consensus on any significant change will be a very long wait. But it means we should be focusing our energy on those things we can change, such as payment reform, and accepting those we cannot change.

As that old ditty says, what we need most is the wisdom to know the difference.

I will be resuming my regular bi-weekly updates in January. It will be a legislative session with many pressures and controversies, and it isn’t possible to report on all of them, so please feel free to contact me and ask questions about issues of concern to you. You can leave a message any time at 485-6431 or and I will get back to you as soon as I am able.



Thursday, May 29, 2014

Legislative Wrap-Up 2014

Rep. Anne B. Donahue

Legislative Update: 2014 Wrap-Up


A Review of 2014

The vast majority of bills that come to the House floor are passed on a voice vote, usually unanimously or nearly so. They reflect necessary statutory updates or policy steps, but rarely have a major impact on the direction of the state.

Some significant ones this year included the battery recycling program, child product toxic chemical monitoring, criminal court diversion for drug treatment, and banning smoking in a vehicle with a young child.

The tough issues most often have to do with money, both in amounts and in priorities.

This year, the governor told school boards that they needed to keep their budgets below a three percent increase, but our general fund increase was 3.8 percent. That was greater than our revenues, so the difference was made up in discrete areas of new taxes.

We also maintained the structural deficit that means the state will begin the 2016 fiscal year budget already $72 million in the red, according to the nonpartisan Joint Fiscal Office.

Translation: we are not creating sustainable budgets.

Property taxes also took a hit. We’d like to blame that all on local spending, but we actually added to future school budgets in two ways. One was requiring access to pre-kindergarten for all 3- and 4-year-olds. The other was adding an assessment that starts at $1,072 next year for every new teacher hired, as a component for bringing retirement benefits into balance.

While the retirement pension issue was critical to address, it didn’t need that particular assessment to begin this year, and I believe it was bad timing to start it before we have done a comprehensive overhaul of education funding.

Our business community had a bad year with the legislature, and that won’t help with economic recovery or future tax revenues. Businesses picked up some of the biggest tax impacts, making up for part of the revenue shortfall through an increased health care assessment, and receiving a disproportionate share of the property tax increase.

The tax bill also reduced the tax credit for innovative, start-up businesses that we’ve been trying to foster.

The more conservative Senate Democrats and House Republicans were able to push back on a minimum wage increase that would have hit small businesses particularly hard by lumping it in a single year beginning in January of 2015. Instead, it will end up at a higher point ($10.50), but it will transition over four years.

Even without the new taxes, the 2014 ALEC-Laffer State Economic Competitiveness Index ranked Vermont 49th among the 50 states in its economic outlook, based upon state policy variables. We were listed number 48 in property tax burden, and 44 in the number of state employees per population.

By its own measures, we may do better than the outlook predicts. We’ve been 49th or 50th for the past six years, but our actual performance rank for last year was 36, with a rank of 40 for the cumulative growth of the state gross domestic product between 2002 and 2012. Better, but that is still in the bottom fifth.

The Structural Deficit

For years now, the Joint Fiscal Office has been trying to educate us about the fact that our budgets are not sustainable under current revenues. We may appear to end each year with a balanced budget, but in fact simply pass the deficit buck(s) on to the next year.

We did nothing to change that this year.

I’ve gone into considerable detail on how this works in a companion article that is too long for the purposes of this column, but is available on my blog at

Briefly, it uses two examples: the $7 million in “new” resources that we included to combat opioid addiction, and an example from Reach Up on the way “savings” are sometimes manipulated.

The money for substance abuse treatment actually comes almost all from hypothetical savings to be achieved through better service delivery. That is a terrific way to do it, if it works, but the evidence that it will work is fairly weak.

When it falls short, the cost overrun will show up in next year’s midyear budget adjustment and next year’s new base budget. So we didn’t actually budget for the money intended to be spent this year and it will be part of the new deficit next year.

On the other hand, my committee attempted an initiative to help families succeed in getting off Reach Up assistance benefits in a way that was truly budget-neutral. A reduction in everyone’s cash grant by $4 per week created the ability to increase the income disregard (the amount a person can earn and keep without losing the same amount in the grant) for those working, from $200 to $300.

That is a work incentive that helps a family get off of public benefits.

The Senate instead decided to fund it by making it contingent on projected savings next year, assuming the Reach Up caseload continues to drop in a recovering economy. That makes it sound as though it is another net-neutral funding mechanism.

The reality is that if those savings are not used to fund this new benefit, they would be used to balance other existing budget pressures.

Just last week, the governor announced that he was authorizing 16 new social work positions for the Department of Children and Families in the wake of Vermont’s second child abuse toddler death. He said it will have no budget impact, because it will be paid for by higher-than-anticipated savings from further reductions in this year’s Reach Up caseload.

No budget impact?

That money would be going somewhere else instead, and furthermore, those added positions will be in next year’s base budget, as a new piece of the increased costs of simply maintaining “what we already have.”

This is not to argue the merits of any of these. The point is only that we can’t pretend they come for free, and when we add costs, we have to increase revenues.

A Big Ticket Item

When it comes to under-estimating costs, the new Vermont Psychiatric Care Hospital in Berlin budget ranks high. Two years ago, in the governor’s proposal to reform the public mental health care system, the estimated operating cost for a smaller state-run hospital was about $1,460 per bed per year. Now it is opening at a cost of $2,250 per bed (other hospital units in Vermont providing equivalent care are operating at about $1,450 per bed apiece.)

That translates into bad news for the overall vision of shifting more care (and money) from hospital to community services. We have suspended some of the intended new community programs, because the money isn’t available.

The community expansions were supposed to be net neutral to the general fund because of federal matching funds that were not available to the old state hospital.

Instead, as of now, we’re spending $1.6 million in additional state funds.

Other Budget Pressures

Another route to becoming “locked in” to budget numbers is when we abdicate responsibility to set budget priorities. Last year, we authorized independent home care providers to form a union in order to negotiate for higher wages from… us. The contract came in at 1.8 million more than the administration projected in its budget, and that was one of this year’s last-minute budget pressures.

This year we authorized home child care businesses to unionize to negotiate higher child care subsidy rates from… us. The Joint Fiscal Office estimate of cost next year ranges from $1 to $2.5 million.

A Sleight of Appearance

One of the last bills of the session addressed education funding, and it looked good. The House had passed a six cent property tax increase to pay this year’s school budgets and the Senate cut it to four.

So less of a property tax increase? Not quite. The bill also reduced the state payment per pupil, leaving more to be paid by the local share of the property tax. You’ll pay the same; it will just be out of your other pocket.

One theoretical effort to address cost containment barely passed the House and failed to win Senate support: that was the school consolidation bill. Although I could see some benefits to the plan, it was misguided to assume this would have addressed our cost crisis.

A Lost Priority

I did have one priority for a budget item: to have the state repay the federal government for the processing errors we made in food stamp benefits, instead of leaving recipients to pay. Regrettably, my committee’s bill did not make it past the Appropriations Committee.

These were all folks who had no way of knowing they were receiving more than they should have. If they don’t have financial resources, they are now being “billed” for repayment through a reduction in current food stamps.

As our committee chair, Ann Pugh, told VT Digger, “The vast majority of Vermonters who rely on 3SquaresVT are children, elders and people with disabilities. They’re not squirreling away their food stamps.”

Lost Budget Language

The session ended on one sour note for me. In 2005, we passed a law that required that persons in a psychiatric crisis be restrained only to the degree necessary to protect safety when being transported to a hospital, and never in prison shackles (medical restraints are available if needed.)

There are only a few counties where sheriff’s departments are out of compliance and still routinely shackle every patient they transport. At my request, the House Appropriations Committee included budget language that permitted the Department of Mental Health to contract for transportation services only with departments that comply with the law.

The Senate struck the section, and it ended up as a request for a report.

One wouldn’t think telling folks to follow the law would be controversial.

I want to extend my thanks to all those who have stayed connected with our state legislature’s actions this year through my Northfield News columns, my email list, Front Porch Forum, and through your direct contacts and inquiries. This connection with constituents really helps make me feel that I can be effective as your advocate and representative. Remember that I’m your representative off-session, as well! Contact me any time with questions or comments, at 485-6431 or

I will be running again for the 2015-16 session, and I thank all of you who signed the petition to place my name on the ballot. As long as I feel able to make a productive impact -- and hopefully never for beyond that! -- I will continue the effort to achieve a responsive, transparent state government that meets the needs of its citizens, creates a sustainable budget, and promotes economic vitality.

Have a great summer.

Rep. Anne B. Donahue


All in a Day's Work? Budget Follies

What’s In a Day’s Work… and the Budget?

During the debate on the minimum wage this spring, I shared my belief that there is something wrong with the economics in our society if a full week’s work doesn’t pay enough to keep a family out of poverty.

Raising the minimum wage isn’t necessarily the answer to this dilemma. Economics is more complex than a governmentally-imposed wage solution. But straight-out subsidies certainly are not the best way to support families, and I often hear complaints that we are too generous in that regard.

Legislators received an excellent graphic this spring that illustrated the earnings and net income inclusive of all wages and benefits for a hypothetical single parent with one child. The dynamics change with every family make-up, but it gives at least one portrait.

What it shows is that in our efforts to help, we often shoot ourselves in the foot. Beyond that, the efforts my committee made to try to increase work incentives reveal some disturbing trends about how we squeeze budgets out each year.

We never actually pass balanced budgets in the long term. They just start out appearing to be balanced. We hide the imbalance and pay for it the next year. Both Reach Up and our opioid addiction investments (explained later) provide excellent examples.

Here is what happened with Reach Up:

The color-coded chart we saw for the two-person family showed that if the parent is earning an annualized rate of $6 per hour – about $13,700 – he or she is not eligible for a Reach Up grant, although still earning below the federal poverty line ( $15,730). The family does net about $3,000 from the federal earned income tax credit, and another $1,000 from the Vermont EIC.

The two largest benefits are subsidies for health care insurance (about $9,000) and child care ($7,000), followed by food stamps ($3,500), renter’s rebate ($1,500) and $1,000 each in the child tax credit and fuel assistance.

When all is said and done, a two-person family moves from a net of $31,000 in benefits with no earnings to just under $40,000 at the $6 per hour annualized income. That increases only very gradually to $44,000 once making $9.62 an hour ($20,000 per year), because earnings only slightly outpace benefits being lost.

Between $9.62 and $16.83 per hour, every increase in wages represents a loss in family net income until it drops back down to $42,000. That is what we call the “benefits cliff”: working to do better for oneself actually creates a loss in income.

Not until reaching $20.43 per hour does the family equal the net income that was coming in at $9.62 per hour. After that point, the climb becomes relatively steady, except for one blip when Dr. Dynasaur is lost for the child at the $30/hour earnings level.

What about someone earning below $13,700 per year? Since $6 per hour is below minimum wage, this means they are not employed full time. If a person is only working enough to earn $5,000 a year, the Reach Up grant is $3,000, for a net of $9,000. (At zero earnings, the grant is a little over $6,000.)

Between earnings of $5,000 and $9,500, as the Reach Up grant declines, actual net income only climbs from $9,000 to $10,500. In other words, increasing work hours by almost double only increases cash income by about 11.5%. That’s not exactly a work incentive.

This is the issue my committee’s Reach Up bill attempted to address this spring.

The challenge in addressing the benefits cliff is that it costs a lot more money if we try to help people keep more of their earnings until they are higher up on the pay scale. Our solution was to transfer money instead: to take a tiny bit from all Reach-Up grants, about $4 per week, in order to increase the initial income disregard from $200 to $300 per month, and extend the “slope” to keep 50% instead of 25% of further earnings for those who work, until leaving Reach Up.

The income disregard is the amount that is not counted against a reduction in the Reach Up grant. So it would have helped poverty-level families keep a little bit more of the income earned before losing Reach Up.

The Senate, however, could not tolerate the $4 per week reduction (barely more than $200 for a full year) in the Reach Up cash benefit. It also wanted to see the increase in benefits go into a higher child care subsidy, to be provided further up the income scale.

The bill as finally passed does increase the income disregard starting a year from this July, but only by $50 with no increase in the additional percentage retained. The rest of the new incentive goes to families already earning more than that, and for child care, not cash in the pocket.

The bigger problem, in my estimation, is where the money will come from. All of a sudden, instead of the trade-off in where the support was targeted, the Senate took it all from future “savings” in the Reach Up program.

As the economy improves, the Reach Up caseload has been going down. Fewer families are seeking assistance. When it goes down faster than we project, we have savings in the budget that were not anticipated: “extra” money.

The Senate made the benefit contingent. If we have savings in the year ahead, that will be invested in these enhanced benefits next year. That sounds pretty innocent, from a budget-neutral point of view.

But here’s the catch. Assuming those savings do emerge, and assuming we had not created this new benefit, that money would be budgeted somewhere else that it was needed. If it goes to the new benefit, that “somewhere else” will still have to be paid for.

Precisely because we budget every year based upon money that is not part of our anticipated revenues, we start each new budget year in a big hole in order to maintain the same level of (increased) spending.

As of the budget passed in May, we will begin our next budget year $72 million in the red. This is the “structural gap” that our Joint Fiscal Office reminds us of every fall. We spend more in the budget than our revenues, and then desperately look for band-aids every year. The new, one-time spending becomes part of the base budget for that next year.

When we say we need to raise a certain amount of revenue “just to stay even,” that is what we mean. Often, a part of that new revenue comes from squeezing some new federal money out of match rates. It works in the short term, but is high-risk revenue. Every time the federal budget is cut, or our match rate decreases, we have another big hole “just to stay even.”

This year, we passed a budget that was a 3.8 percent increase over what we project that we will spend by the end of this year, which is above the rate of economic growth – and above the rate the governor told school boards they should stay within.

Unanticipated expenses that arise and are paid for in the mid-year budget adjustment act are sometimes just another way of adding onto the budget bottom line. Administration officials sometimes slip up in testimony when asked about a probable funding need that isn’t in the budget, and admit the plan is to pay for it in the budget adjustment. That’s not exactly “unanticipated” need, but it avoids counting it in the budget being presented.

The projected Reach Up savings make for an excellent case-in-point regarding our budget. If we gain those Reach Up savings in the next year, they ought to be going towards that hole, instead of funding a new benefit – even as positive as that benefit may be.

But it has already gone well beyond that. In the midst of the crisis in our Child and Family Services Division, with two toddlers dead in the past six months, the governor has announced the creation of 16 new social work positions out of “extra money.” This extra comes only a month after we passed the budget, including the increase in some taxes to balance it!

The governor says it won’t cost anything in the budget, because it will come from unanticipated savings in… Reach Up. Not next year’s (which is targeted for the new benefits), but a greater caseload reduction than even already expected for the current year when the administration was building the budget.

I gave another example of budget games in my main session wrap-up this week, and I’ll go into a bit more detail in this analysis on the artificial investment into treatment for opioid addiction. That’s the $7 million into new treatment resources the governor committed to in his state-of-the-state address, and which the news media all reported as being achieved in the budget we passed.

The $7 million is in the budget, but where does it come from?

Almost $5 million comes from projected savings that it is hoped will result from more efficient delivery of services. Using money more efficiently rather than spending new money is a very good thing, of course.

However, it is deceptive to suggest that we are creating new resources, and those savings that are being projected are very tenuous. The administration took a small pilot in Burlington and found some significant savings over the course of a few months that came from better coordination of addiction treatment.

It extrapolated those savings statewide and year-round. The transferred money will go to the “Care Alliance for Opioid Addiction,” which has qualified as a “health home” (not to be confused as a “medical home”) under the federal Affordable Care Act.

The reductions include almost $1 million in residential treatment, $1m plus in physician services, and $2.8 in other outpatient services. (Another $3.6 in savings is projected to come in changing the independent lab used for drug monitoring.)

The House and Senate Appropriations Committees were skeptical that there was a sound basis to project this level of savings to fund the new services, but didn’t go so far as dismissing them. They added budget language demanding accounting to show the money trail:

“… the Secretary of Administration and the Chief of Health Care Reform are authorized to transfer Global Commitment funds from the Department of Vermont Health Access (DVHA) to the Office of Alcohol and Drug Abuse Programs for the Care Alliance for Opioid Addiction. A written notification shall be submitted to the Joint Fiscal Committee for funds transferred under this subdivision and shall include a description of the specific use of funds within the Care Alliance for Opioid Addiction … Anticipated or identified savings in DVHA or other departments of the Agency of Human Services identified as a result of the increase expenditures through the Care Alliance for Opioid Addiction shall be included in the notification set forth in subdivision (1) of this subsection.”

What happens if the savings in the Medicaid program do not match the increased spending in the new program? That “unexpected expense” will likely show up as an increase that needs to be funded in the mid-year budget adjustment next January.

So in fact, we may well end up spending new money instead of simply using money more efficiently, and the investment description won’t have been deceptive. However, that means that the budget we just passed won’t have actually been a balanced budget.

This is what sometimes gets called “smoke and mirrors.” More charitably, it might be called budgeting on “a wing and a prayer.”

Either way, it is another example of the structural problem that our Joint Fiscal experts keep warning us about. Our annual deficits will not go away. That means that in each new budget year, it does become impossible to avoid budget increases beyond the rate of economic growth without serious cuts. However, the reason is that the actual budget increases came in hidden places the year before, when we didn’t actually pass a balanced budget.

The other behind-the-scenes piece that will bite us in the future is the fact that the Alliance is an Affordable Care Act health home. This means it has been approved for a highly enhanced federal match rate (90/10) for three years. In theory, the new model will be so efficient that after three years, when the match rate goes back to the 50-50 range, the state won’t be paying any greater amount for those same services.

And I have a bridge in Brooklyn to sell you, for cheap…

Saturday, May 3, 2014

Legislative Update May 3, 2014

This week I’ll give a summary of votes I’ve cast on some of the significant bills that have come through in the past two weeks. For others of particular interest to you, please get in touch to ask me directly.


I voted to support this bill, which would require labeling of foods with ingredients from genetically modified sources, despite the near certainty of a lawsuit on constitutional grounds by GMO companies. My rationale is summed up in the vote explanation I placed on the record:

“I have always supported the consumer right to have information on the content of the food they buy. My better judgment would go against supporting a bill with such potential for a high financial liability. My constituents, however, strongly endorse it despite that potential cost, so I cede to that judgment and choice.”

School Consolidation

I think we need to move in the direction of larger districts so that our students have access to more opportunities and we gain from economies of scale and more consistent planning. I was therefore tempted to support this bill to get that conversation going.

We have the smallest districts in the country at 299 students per district. New Hampshire has average districts of 1,200 students and Maine 818. We know we have one of the highest per pupil costs, rising at an unsustainable level.

However, this bill does not address the fundamental problems of the dynamics of cost and of the property tax burden, and I fear that if it passes (having “done something”) we will lose focus and pressure on addressing these more critical underlying issues.

I voted no; the bill passed on a relatively close 75-62 vote, and it is now up to the Senate to react in the short time remaining this session.

Toxic Chemicals

The Senate sent over a broad bill covering all consumer products, and the House narrowed it to focus on chemicals that are of particular concern for exposure to children under age 12. An example: there are some very toxic ingredients in play cosmetics marketed for little girls.

These will be listed on a Department of Health web site, and there can be additions to the list if new ones are identified. My committee has spent a great deal of time in past years addressing chemicals on a case-by-case basis, and this bill will allow regulation without repeat legislative action. I voted to support it.

Raw Milk

The bill to permit delivery and pick up at farmer’s markets for customers who are already signed up and have visited the farm was a minimal expansion of current law. I voted yes, but regretted that it did not go farther.

Health Care

This bill adds detail to the information that needs to be gathered before the viability of a universal access health care system can be determined. It also gave the governor a new, January 2015, deadline for sharing a plan for financing it. He already is in violation of a 2013 legislative directive, and of his own promise to provide it a year late this spring.

The good news in this bill was the upfront acknowledgement that the plan cannot go forward without full fiscal analysis and that 2017 is not a target deadline of the legislature, regardless of what the governor may say.

The down side of dropping an artificial start date is extending the uncertainty about the outcome of this entire reform effort.

We are still a long way from even asking the right questions. For example, regulations for a federal waiver of the Affordable Care Act, which would have to be received before Green Mountain Care could get underway, include the required submission of a 10-year budget to show sustainability.

Our current law only requires a 5-year budget, and this new bill did not change anything in identifying what we mean by “sustainable.”

Most startling is the requirement in the bill for the administration to submit a “conceptual waiver application” to the federal government by this November 15 (two months before the new due date for a financing plan.)

I looked up the federal law and regulations and found no reference anywhere to anything resembling a “conceptual waiver application,” and under my questioning on the floor, the Health Care Committee chair acknowledged that no such application exists!

I asked for a vote to remove that part of the bill – suggesting it was an embarrassment to be directing the administration to pursue an impossible action – but the committee did not back down so the vote failed along party lines. I voted against the full bill as well.

Involuntary Medication

I co-presented the bill changing some of the procedures for when persons in a psychiatric crisis can be subjected to a court order for medication over their opposition if they do not have the capacity to make a medical decision.

This relates to persons who have already been involuntarily hospitalized because it is believed they are a danger to themselves or others. The medications are themselves controversial because of questions about whether long term risks outweigh the short term benefit of stabilizing an illness.

It is a terrible affront to human dignity to forcibly medicate someone. Both my Human Services Committee and the Judiciary Committee worked very hard to maintain the delicate balance between allowing as much time as possible for a doctor-patient relationship to result in a collaborative treatment plan, yet allowing for informed consent to medication to be decided by a judge when there is no other option. 

Our bill, which passed on a 132-6 vote, was narrower than the Senate version, so it will be going to a conference committee to resolve the difference.


My committee worked on a Senate bill making judicious revisions to our law protecting people from prosecution if using marijuana to relieve symptoms of specific severe illnesses. Our bill was hijacked on the House floor through an amendment adding a tax study on legalization of marijuana.

I don’t mind the idea of the study nearly as much as I minded mixing these two very different issues, and I voted against the bill that I had supported in my own committee. The Senate accepted our changes so the bill is headed to the governor for signature.

Coming from the Senate

I was pleased to see my Taser bill pass the Senate. It will require statewide standards for safe and appropriate use of Tasers, along with required training in mental health interventions for all police officers in the state.

The Reach Up work incentive bill from my committee is being sent back by the Senate with radical alterations. Instead of an internal, cost neutral budget by taking a small amount (less than $5 a week) from current public assistance grants, the bill would take the funding from caseload reduction savings. Since those savings would normally be used elsewhere in the budget, this is no longer a neutral shift.

It also uses the funds to supplement child care grants instead of permitting families to keep a higher amount of work income. This is clearly much less of a return on the investment in work, and eviscerates the bill. It was a bright star of this session, and hopefully will make it into law through another route.

Contact me with a message about any of the issues that will be coming rapid-fire through the legislature in these final days. You can call me at home at 485-6431or at the legislature at 828-2228, or by email at





Saturday, April 19, 2014

Legislative Update, April 19, 2014

Legislative Update

Rep. Anne Donahue

April 18, 2014


The betting pool has closed for the end date and time for this session. (Don’t panic about the gambling; it’s only $2 per guess and half goes to a local charity.) Most bets were clustered around Saturday, May 10.

The legislature is budgeted for 18 weeks, which would make it May 16, but leadership aims each year to save some money with an earlier finish.

Is that a good thing?

Like students and most other humans, we tend to use early time inefficiently and then cram at the end. That would probably be true no matter what the deadline, but it seems to be more so when we try to cut the session short.

This year, the end of the two-year session, all bills that do not pass die, no matter how much work has been invested in them. That puts more pressure on finishing bills that have already passed one body and sit in the other. Pressure can thwart efforts at careful work.

I often hear from constituents that the less time we spend in Montpelier, the better: it keeps us from gumming up the works with new laws. The longer that I am here, the more I see the volume of necessary work to revise laws that are not working as they should, or that address new problems. Doing a good job on any one of these issues can take weeks.

My committee is rushing to finish two Senate bills. One addresses the increasing opiate addiction crisis by reshaping the criminal justice system to get individuals into treatment as rapidly as possible. It will create opportunities for fewer criminal prosecutions for persons who fully engage in treatment.

The other addresses the most severely mentally ill patients in our hospitals, and how to respond to individuals who lack the capacity to make informed medical decisions, but are objecting to treatment with psychiatric medication.

The risk-benefit profile of these drugs can be unclear, so some advocates want them used rarely, if at all. Forcing someone to take a drug involuntarily is – as a Legal Aid attorney testified – a very big deal.

Care givers, on the other hand, believe that the current judicial process for weighing interests is far too slow and needs to change. The hospital association has been leading the push for a more expedited process. In rare circumstances a patient’s symptoms may even lead to assaults on other patients and staff, and a six- to eight- or more weeks’ process for a court decision is irrational.

Both these topics need review by at least two committees because of their subject matter (my Human Services Committee and the Judiciary Committee), and both need a good deal of time for adequate testimony. We are a lay legislature and need to gain from the expertise of others.

There are many more issues that need attention than we can get to in any one session, so many get deferred. Obviously, the level of priority varies based upon individual legislator’s priorities, and choosing among them is a part of the functioning of the democratic process and of who is in control of that process.

But I have seen first-hand how going too fast results in bad law. And while we rely upon the in-depth work of committees to learn the working of, for example, a complex commerce regulation, it is often on the floor with the full House that errors are caught. Until a bill reaches that point, only the members of the committee of jurisdiction have seen and reviewed it.

When a bill is on the calendar for notice for a day and then goes through two days of opportunity for debate, there is time to identify unforeseen consequences, ask questions, and offer amendments.

When it is a major policy matter, those days also provides the time for greater public awareness, and the opportunity for constituents to share their opinions with their representatives.

In the last week of the session, when there is a push to skip all the process and get work finished, there is a way to shift into hyper-speed. By a vote to suspend the rules of the House, all the “extra” days can vanish.

Seven years ago, this expedited process had become so extreme that we were receiving bills that were still warm from the printer, and final votes were being held within hours. I rebelled, and began making motions to refer bills back to committee and then asking for roll call votes on the motions.

It was mostly symbolic, since the majority was controlling the process and none of the motions had a chance of victory. Some of my colleagues got pretty annoyed at the several-hours delay it caused for adjournment that night. But others acknowledged as we left, “You are right about it.”

The outcome was a strengthening of resolve the following session to push back. Despite a significant minority, the Republican caucus retains enough members to win votes that require a two-thirds margin. A vote to suspend rules requires a two-thirds majority.

Thus at the start of that session, we gave notice that we were going to hold to a schedule of requiring at least 24 hours to review bills before voting them out. That practice has now stood up for three sessions. Our caucus agrees to waive the 24 hours only if the bill is a brief and non-controversial one.

Politics still emerge. The majority party has sometimes put pressure back on by twisting perspective and accusing the minority of playing politics to delay the end of the session by refusing to agree to suspend rules on a bill!

The court of public opinion can easily be swayed when all the facts aren’t clear. That’s why I thought I’d lay the facts out in advance this year. If you hear claims that Republicans are “delaying adjournment,” it means that we are insisting on having 24 hours to read bills before voting.

A lot of laws move very quickly in the last few days of the session. Bills that never had committee review get tacked onto other bills in order to get them passed. Whether you think the bill itself is good or bad, the fact that these are added without public notice, testimony, or committee discussion is not good.

Completely new language pops up in bills that come from a conference committee of six House and Senate members. Wordsmithing takes place in hallways instead of in committee rooms. It is not a very transparent process.

So regardless of any accusations of causing delay, I will continue to insist on the right – on your right – to be able to read and understand a bill before a vote.

I welcome your questions on any of the issues we address as we move into the “end game” of this biennium. You can leave a message with the Sergeant-at-Arms (828-2228) or at my home (485-6431) or contact me by email at  

Saturday, April 5, 2014

Legislative Update, April 5, 2014

Legislative Update

Rep. Anne Donahue

April 5, 2014


The increase in Northfield’s education property tax rate by more than eight cents may come as a rude surprise to voters who supported a school budget that was half a percent lower than last year’s.

Northfield was one of 43 towns on a list presented on the House floor last week that decreased their budgets and yet will face an increase in the actual homestead rate. It epitomizes the problems with our current financing system.

How could this happen?

The short story is that what we pay comes as a blend of three factors: our local budget, the combined statewide school spending budget, and that “common level of appraisal” factor. If a majority of school districts around the state increase budgets, than the cost for every taxpayer goes up, since the state-raised money is distributed equally. The legislature had no choice but to increase the property tax rates to raise the money voted in by school districts.

That is made more complicated by the estimate of a town’s current property values compared to the length of time since its last reassessment. Northfield’s rate goes up eight cents instead of the statewide increase of four cents because its common level of appraisal has dropped another 3.4 percent since last year. Reassessment is now occurring but not complete, so current figures are considered outdated.

What does the legislature intend to do about the financing system? Once again, nothing this year.

Does a new funding mechanism really matter, if we haven’t gotten a handle on the statewide increases in budgets that occur above the level of inflation and despite fewer students?  The funding bill this year did make a few tweaks that put more pressure on voters to take a hard look at increases, but those won’t bring about any dramatic changes.

A legislature can never force a future legislature to do anything, so in these final weeks of the current biennium, nothing can be put in motion even for next year. The best we could do was in the strength of “intent” language for working on new approaches.

We could vote for the bill as presented, expressing an intent to work next session to create a system that relies more heavily on a progressive income tax. We could have voted for an amendment that expressed an intent to develop a new system, and that repealed the current system in two years.

A repeal itself could be repealed in the future, but would require an affirmative vote to retreat from the intent, thus making it a bit stronger than the language in the bill. I voted for the amendment, but it was defeated in a party line vote.

New School Governance?

A pending House bill would create much larger school districts, thereby reducing local control, to the extent that any remains. A single school board with representation from all of the towns would decide the district-wide budget.

The idea supports both economies of scale and broader opportunities for students.

It would not be fully implemented until 2020, with opportunities initially for towns to present voluntary proposals for expanded districts. It is late in the year for such a major change to get through both House and Senate, so perhaps it is only being floated as a trial balloon.

Nonetheless, Rep. Patti Lewis and I touched base with some of the Northfield and Berlin school board members, and the general sense is that this is ultimately something that needs to happen, so the process should begin.

Minimum Wage

The arguments for a significant increase in the minimum wage are compelling. The value of a hard day’s work should at least merit enough pay to live above the poverty line, and investments in this direction are far superior to state subsidy programs for those who do not.

Were that it was so easy a decision.

The cost in wages to achieve this in Vermont have been estimated by our Joint Fiscal Office at $30 million. To get a sense of this scope, I asked Joint Fiscal what this would equal in terms of the sales tax. It would amount to roughly a half a percent, in other words, a change from six to six-and-a-half percent on the general sales tax, and from nine to nine-and-a-half percent on rooms and meals.

I thought this analogy could be useful (despite being highly imprecise because of many complicating factors) because an actual minimum wage increase will largely be paid for through an increase in the costs of goods and services.

Small businesses are afraid that such a margin of change could tip the scales for some of them. Often their prices are already not competitive with big chains, but they survive because of convenience for those in small towns, better service, specialties, and other intangibles that bring value to customers. Bear in mind that in addition, we just voted to increase the non-homestead property tax rate by seven-and-a-half cents, compared to the four cents for homesteads.

The larger issue is the impact of higher prices on the national and international markets where Vermont products are sold.

We currently have the third highest minimum wage in the country, $8.73 per hour, and even other states that are in the process of increasing minimum wages will increase them to less than ours.

Only wealthy Connecticut will move ahead of us in New England with its increase to $9 per hour in 2015. The next closest, New York, will move from $8 to $8.75 in 2015 and then to $9 in 2016.

I could support a staged increase that would keep in the forefront with our neighbors, but I believe the leap from $8.73 to $10.10 an hour in a single year, as proposed in the House, will do more damage than good.

This is an issue that is similar in some ways to the health care system debate. We are not an island, and we are not very large. We operate within a national economy, and we are a pretty little fish in that sea to think we can turn national currents. (How small a fish? Here’s a little nugget. The largest apartment complexes in the country have – in one apartment complex – about 20 percent of the total population of Vermont.)

Marijuana for Symptom Relief, Again

My committee is voting out the House response to a Senate bill expanding our system for compassionate access to marijuana without threat of criminal charges for those with specific debilitating illnesses.

We’ve expanded it carefully over the years, and it has been described as the best and mostly highly regulated system for “medical marijuana” in the country. (It is explicitly not “medical marijuana” in Vermont, which would imply a finding for a medicinal value that it not yet supported by medical research equivalent to that for other medications. I have clearly lost the battle in communicating this distinction to the media and public at large.)

My committee is supporting many aspects of the Senate bill, except for the most fundamental change it proposes. Last session, we approved creation of four non-profit dispensaries to increase the safety of the marijuana sources for those eligible to access it.

The Senate proposed that given the success of that program thus far, in terms of safety and security, we should increase the allowable number to six. We feel that proclaiming success is a bit premature. Two dispensaries have been open for nine months, one for seven months, and one for two months. We are voting against supporting that expansion.

However we are adding language to ensure that nothing in our law precludes development of a new strain, based upon the hemp variety rather than marijuana, that has been achieving apparent success in relieving a life-threatening multiple seizure disorder in children.

Your input is welcome on these or any other of the many issues that will be coming before us in the weeks ahead. Contact me or Rep. Lewis via message at the Sergeant-at-Arms office at 828-2228 or at home at 485-6431 (me) or 223-6319 (Patti Lewis.) You can also use my home email,, or our legislative addresses, or  For access to all of my legislative updates for the session, go to