February 20, 2016 Legislative Update

My health care committee continues to plow through challenging issues as we head into the last week before the town meeting week break. I joined in a press conference last week after we heard testimony from a consulting group that has worked for the administration for the past three years. The issue: Vermont Health Connect, the state’s stubbornly rebellious system for people signing up for health care through the health care exchange.

The CEO of Gartner Consulting testified that his firm told the Shumlin administration back in 2013 that it was trying to do far too much at once by creating an exchange that would handle private insurance and Medicaid from day one. Boy, were they ever right – but the administration didn’t listen. This is yet another piece of “new news” coming to us years after the fact.

As a legislature, we hold responsibility for oversight. But we are a citizen legislator, and have to rely heavily on expertise from others. I’m no computer expert, but just in looking at the world around us, whether banking or shopping or business, it seems inconceivable that it could be as complex as everyone is claiming to get a working system for signing up and paying for health insurance.

Yet I have been reluctant to support the call to ditch the entire Vermont system and take on the new costs connected to joining the federal system instead.

We’ve invested more than $200 million in it. Do we throw all that out, if we are truly in the home stretch of getting it to work correctly? Or do we stop digging ourselves even deeper into a hole that is a money pit, throwing good money after bad?

The Gartner consultant said we need to stop pouring money into trying to fix our current system, but that we should not jump to something new without having an independent analysis of the best long-term, sustainable system. We should continue to “limp along” with the existing system for several more months, without making large new investments trying to fix it, while doing an analysis of the “investment value” of what we already have and the costs of turning to other options. Some choices might allow us to use some of what we have already invested in, while also aligning with another system.

This makes sense. It is the same recommendation made earlier this year by Blue Cross Blue Shield of Vermont, which has had to pick up the pieces of many of the major failures of the current system.

What does not make sense is to have the Shumlin administration do that analysis, as his staff suggested!

At our press conference, both Senate and House members joined Lt. Gov. Phil Scott in proposing that we move ahead as quickly as possible with this analysis, but to place it under the authority of the Green Mountain Care Board instead of the administration.

I will be pushing for language in the current budget to make this happen.

***

We sent a bill to the House floor this week to have the Green Mountain Care Board identify all of the quality measures that require reporting from primary care doctors, and to develop a plan to reduce the burden while still monitoring quality.

We have both state and federal programs that demand data to assess whether they are effective or not, and obviously, it is vital that we not putting money into programs without assessing whether they work. On the other hand, we should be able to align some of these different measures so that we get the information we need with our doctors having to spend more time on filling out different reports than time with patients.

***

We are working on a bill to set state standards to protect consumers under the new “Accountable Care Organizations” that are now part of our health care system under federal Medicare. They will become an even bigger part if we develop a model where all the major payers (Medicare, Medicaid, and private insurers) agree to pay ACOs the same way, per patient instead of per individual service.

An ACO is a group of doctors and providers that contract for joint responsibility for patient care. We will likely end up with a single ACO in Vermont, given our size. Because they are expected to work to save on costs, there is good reason to worry about whether quality and access to care will be reduced.

We need stringent standards to require ACOs to deliver appropriate care and to have independent appeal mechanisms for anyone who feels necessary care is being denied.

***

A vexing problem we are confronting is ambulance service payments under Medicaid. The state sets these rates, and we current pay far below the costs of the service. The increase in the number of persons on Medicaid under Obamacare has meant that local ambulance services are losing even more money.

Who makes up the difference? You, in your property taxes. Ambulance services are generally town-run (in contrast to other health care), so the cost shift for underpayment goes straight to town budgets.

This is a problem across health care, where the costs are covered by private insurance reimbursements (and higher rates for private payers), but it is worse for our local rescue crews because it has been much longer since they saw any rate increases.

They only solution is to increase Medicaid payments, and there’s the rub. We already have a gap of tens of millions of dollars in the state budget, mostly caused by increases in the Medicaid budget. We are continuing to look into this, but haven’t found a way out yet.

***

In the House last week we passed the mandatory paid sick leave bill that will require all employers to eventually provide at least five days of sick leave per year. On its face, this seems appropriate, but the devil is always in the details.

The bill includes even tiny businesses trying to get off the ground with only a few employees; it covers employees who work even less than half-time (18 hours per week). “Sick leave” includes taking an extended family member for a doctor’s appointment, staying home with a child on a snow day, or going to court for a family abuse hearing.

These are all good things, but are a lot to place as a burden on the cost of doing business in Vermont, especially at a time when our economy is so fragile. We need to do everything to protect small businesses if we want to protect the jobs they supply.

Some have pointed out that some employers will simply be forced to reduce salaries to cover the overall cost of hiring added staff to cover those out on a sick day. That won’t really help anyone.

As a result of these issues, I did not support this bill.

***

Importing ivory has been illegal in the United States for decades, but an illegal market thrives on poaching of elephants. One way to help fight this is for states to make the sale of ivory illegal within their boundaries, and the House passed a bill this week to have Vermont join a number of other states in this ban. The bill now goes to the Senate.

Discussion on the House floor included one light-hearted comment, when a Republican got up to speak in support of the bill by reminding others that the elephant is the symbol of the Republican party.

“We need to protect the elephant population,” he said as he looked across the chambers at other members of the minority party. “We clearly need more here.”

***

Thanks for the honor of representing you! You can contact me or Rep. Patti Lewis by email (counterp@tds.net for me; pattijlewis@myfairpoint.net for Patti) or by leaving a message at the statehouse at 828-2228. We welcome your feedback and input.

Legislative Update, Feb. 6 2016

Legislative Update

Rep. Anne Donahue

Feb. 6, 2016

 

Pity that we can’t maintain focus on the critical issues before us – the economy and budget, education and health care – instead of being distracted by whether Vermont should make marijuana legal.

This bill is not in the House yet; in fact, it hasn’t reached the Senate floor. But that’s where I’m getting questions from constituents, so:

A few years ago, I was prepared to support decriminalization (changing possession of small amounts from a crime to a small civil penalty) on three conditions: continue to consider it criminal if possession was in a school zone, enhanced penalties for possession in a motor vehicle, and a higher fine for use in public places. The bill passed with none of those, so I voted ‘no’ and was left with little confidence that there was a commitment to protecting against use by young people or against drugged driving.

I see little urgency in shifting from our current decriminalization law to endorsing it as “acceptable” (the effect of legalization.) So I currently lean against this change.  

I look forward to hearing more input from constituents.

***

The House bowed to pressure from school boards and the Senate to nearly completely repeal a bill passed less than a year ago to help slow the growth in school spending. The effect will be that towns that avoid large budget increases will take on some of the cost of those that do not. So anticipate another property tax increase that ignores local restraint.

If you heard about our midnight session to vote on this repeal, you know that even Vermont engages in political games.

Some eight years ago, I began to object to the end-of-session process of rushing final bills through without the time to even read them by suspending the usual rules and turning a three-day process into a half hour process. One of the few actual powers a minority party has is to refuse to suspend rules, because that requires a three quarter vote. So under my leadership, Republicans set out a ground rule that we would not agree to suspend rules without at least 24 hours to review it, unless there was consensus that it was a minor and non-controversial bill.

After weeks of legislative angst, last Thursday evening the Senate voted out its final bill and sent it to the House. The House Speaker scheduled it for a vote at 9:30 Friday morning. This required a rule suspension and would have left legislators with no time to even consult with their constituent towns or to assess the full fiscal implications of the Senate changes.

Democrats argued that there was great urgency because school boards had to finalize budgets by that Sunday, ignoring the reality that the window of opportunity had already passed, since budgets had already been adopted by then. There was no need to take the bill up before the next scheduled session on Tuesday.

Republicans voted against expediting the process. The Speaker kept the House in session for a revote at 3 p.m., threatening to convene the House again on Saturday. Republicans refused to bow to this bully tactic to suspend the normal process. Having been called on what may have been intended as a bluff, the Speaker had to save face and continue to maintain that it was an emergency. He reconvened the House for Saturday, which meant the Senate bill could be considered without needing to suspend rules.

Since it officially became Saturday at midnight, he set the session for 12:01 a.m. – ergo a first-ever January middle-of-the-night session. It cost tens of thousands of dollars for taxpayers, since legislators receive expenses for meals, and rooms or travel costs for the extra day.

(No, I did not put in a claim.)

Ironically, some news media reported that Republicans had tried to “delay” the bill. Last time I looked in the dictionary, refusal to suspend rules to expedite does not meet the definition of delay!

***

How can a tax that raises money from doctors save on health care costs?  It doesn’t – but it does make it possible to grab more federal tax money to pay our state spending bills, so that is the rationale of this budget proposal by the governor.

Here’s how it works:

We place a tax on providers (in this case, adding independent doctors and dentists to our existing taxes on hospitals, nursing homes and home health agencies), and take the money to spend on our Medicaid costs. Since money spent on Medicaid is matched by the federal government, we double the value of the taxes taken in.

Some of that money goes back to providers in the form of Medicaid rate increases. (Medicaid rates pay doctors at well below what it costs to deliver the care.) But they don’t necessarily get back as much as they pay in, and it could end up hurting our access to health care as doctor’s practices become unsustainable – something that has already happened in several instances in parts of northern Vermont.

As my committee delves deeper into this year’s Medicaid budget, we’re also learning more about why the budget is shooting upward.

The federal Affordable Care Act didn’t increase income levels for eligibility in terms of Vermont, because Vermont already had programs (VHAP – the Vermont Health Access Plan, and Catamount Health, a subsidy program) for lower income individuals. But it changes how income is defined, with the effect of making more people eligible. Under federal law a person’s assets (money in the bank, or the value of a home) don’t count in calculating eligibility.

It also bans access to federal subsidies for those with low income if they are now eligible for Medicaid.

So don’t frown on a neighbor who is “taking advantage” of Medicaid despite being above poverty level in income and owning a nice home and car. They have no choice but to either accept Medicaid or pay full price (tens of thousands of dollars a year) for health insurance. And we are all required to have insurance or pay a federal fine.

Through no fault of their own, these folks can end up with a real windfall, because the free benefits under Medicaid are much broader than any regular health insurance. Some of those benefits, such as dental, are optional for states to provide. Others, such as transportation to get to the doctor, are mandated by federal law.

I am pushing to explore whether we can take a middle road and cut back on some of the optional added benefits for the newly eligible, instead of making other cuts to balance the Medicaid (and overall state) budget.

Medicaid is a big deal when we look at the budget. It is 30 percent of our state spending, only a bit under education (33 percent); all other human services supports are 16 percent. Because we pull in so much federal money (coming, of course, from our federal taxes) Medicaid is only about 20 percent of all spending from money raised directly by the state. Education is 50 percent.

***

We’re also digging much deeper into the “all payer model” for health care reform. I’ll go into more detail another time, but it is not nearly as huge a deal as either feared or hoped.

Assuaging Fears: it does not change Medicare benefits. It does not turn Medicare funds over to state control. Medicare continues to be directly paid by the federal government to providers. Doctors who don’t want to be a part of new payment structures can still be paid the old way. Patients can still choose their own doctors, regardless of whether paid the new way (one payment for total care) or the old way (separate payments for each service provided.)

Lowering Hopes: it will create less cost savings than some may think. Better coordination of care and savings on doctor paperwork is likely, but other major drivers of costs will remain. Payers (the big three: Medicare, Medicaid and private insurance) will still pay their own separate rates to providers, so the cost shift – private insurance paying for what the state underpays – will not be solved. It will also add a new bureaucratic layer, because the new payment system requires that providers join an organization of multiple providers to contract for the rate and quality commitments.

***

Thanks for the honor of representing you! You can contact me or Rep. Patti Lewis by email (counterp@tds.net for me; pattijlewis@myfairpoint.net for Patti) or by leaving a message at the statehouse at 828-2228. We welcome your feedback and input.