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Healthcare Update

by Tom Huebner, President & CEO, Rutland Regional Medical Center

As president and CEO of Vermont's largest community hospital, I am Tom Huebnerfortunate to be involved with, and included often, in conversations relating to policy and regulatory matters on healthcare. I know healthcare and policy issues can be confusing, as well as overwhelming, so when there is information I think the community should know about, I will share it here.

An informed community is a healthy community.

Making our Case for Sustainable Care — August 31, 2017

Earlier this month I presented our 2018 budget at a hearing before the Green Mountain Care Board (GMCB). We testified for about two hours, went through our materials. I reiterated that in the past year and a half we voluntarily made three rate DECREASES as a response to the revenue caps GMCB has set forth. I explained that our revenue was up during that time because of an increase in market share, a decrease in bad debt and a decrease in free care due to the Affordable Care Act. Since then though, our market share has leveled to expected volume, our bad debt and free care are increasing, and Medicaid reimbursements are flat. I also noted that only 30% of our payers are commercial which leaves 70% falling into the Medicaid, Medicare, bad debt and free care categories. I believe we made our case well and that they better understand the financial healthcare landscape here at Rutland Regional.

They did have questions. There were plenty of questions about cost and what we can do to reduce it further. There were questions about whether or not we were committed to healthcare reform. There were questions about pricing and quality. And though the Green Mountain Care Board gave us high accolades for our work and our responses, I still worry that they might arbitrarily cut our budget. I hope I’m wrong. We were very careful to prepare our budget within the guidelines that they have established, and I am hopeful that they will find that to be sufficient. At the hearing, I made it clear to them that if they were to request further cuts, we would have to cut programming and services here at the hospital. That reality seemed to have resonated with them. The GMCB makes their ruling in mid-September so stay tuned.

Watch the early part of Tom's presentation to the GMCB on August 17, 2017>>>

A Balancing Act — August 14, 2017

This Thursday, August 17, at 9:10am I will go before the Green Mountain Care Board (GMCB) to make the case for Rutland Regional Medical Center’s 2018 budget. The hearing before the GMCB is a public hearing and I encourage all who are able to attend. The GMCB is a five-person panel that works to regulate the cost of healthcare in Vermont. At this hearing they will listen to presentations from several healthcare systems (Rutland Regional, Brattleboro Memorial Hospital, Southwestern Vermont Medical Center and Grace Cottage Hospital) to determine if the budget requests are warranted and whether or not they show some financial restraint. The panel will take the information presented and rule on the proposed budgets in September. I believe our proposed budget is consistent with the requirements they provided to us in advance, so I am hopeful that we will get full approval.

Creating a budget is a balancing act and this has always been true, but this year finding the balance is a bit more challenging. Certainly Congress’s struggle with the Affordable Care Act and their unsuccessful attempt to repeal and replace it, has added to the uncertainty for hospitals. There have also been changes in the State’s Medicaid reimbursement. That aside, we feel we have done a good job of meeting the requirements the GMCB provided to us in advance.

We consider many factors when making a budget: CMS (Medicaid/Medicare) reimbursed payments, 340b drug discount program, insurer rates, the viability of the ACA, the amount of uninsured individuals in our community, the amount of free care we will have to provide, the amount of bad debt we might incur, etc. We pull all these factors in to come up with a budget that will satisfy the requirements of the GMCB while still allowing us to remain financially sound. Providing high-quality care to our patients every single day continues to be our primary goal, regardless of the political forces and pressures that swirl around in healthcare.

A "Stay" for the ACA — July 31, 2017

It appears that the attempt to overturn the Affordable Care Act has failed. Last week the Senate was unable to pass any of the bills that were proposed but questions remain. What comes next? What things might transpire? I think we might look for two themes.

  1. For those trying to overturn the Affordable Care Act, I think there will be a period of grieving in all of its stages. I believe that will carry through late fall and perhaps into winter. At some point I remain hopeful that there will be a bipartisan effort to fix some of the things that are, in fact, damaged within the Affordable Care Act. We need to ensure subsidies continue and we need to stabilize the insurance marketplaces. Hopefully, in the spirit of bipartisan cooperation, our Congress can come back to that important work.
  2. Revenge is also a worry. I do think there will be attempts by the Executive branch to cut funding to programs that sustain hospitals like Rutland Regional. We’ve already seen some action on reducing 340B reimbursement (a drug discount program for outpatient drugs) and we may see other activity as well. Whether it is successful or not, none of us can be sure. Healthcare systems throughout the country have many friends within government who will try to help in this regard. Certainly, here at home, we have the support of the entire Vermont Congressional delegation as well as the administration in Montpelier. We will be counting on them in the weeks and months to come.

So, for now it looks like the healthcare discussion will take a break, much like Congress as they head off for their August recess. In the meantime, we will continue to do what we do best and focus on providing the best possible care for our patients.

The Seesaw Continues — July 18, 2017

The past week or so has been full of a bit of back and forth with regards to the Senate’s recent iteration of their proposed healthcare bill. The success of this version was questionable from the start. The slight changes they suggested did not change the substantial cuts in Medicaid and the subsequent losses on two fronts:

  1. Hospital Systems would be challenged to survive and provide adequate services to patients with the loss of Medicaid funds and
  2. Millions of the most vulnerable and needy would lose healthcare coverage.

According to the American Hospital Association, Rutland Regional Medical Center alone would lose $190 million in revenue between now and 2026 if the bill, as proposed, was passed. Clearly programs and services in our organization would have to be reworked to sustain a cut of that magnitude. As it stands today, the bill does not have enough support in the Senate to pass. As of this writing, the Senate Majority Leader, Mitch McConnell is proposing a complete repeal of the Affordable Care Act with no replacement. This is highly unlikely to pass. In the end a bipartisan approach is needed. Regardless of which way the seesaw sways, all of us at Rutland Regional continue to be committed to delivering the best possible care to our patients.

VPR Interviews Tom Huebner — July 12, 2017

The Senate Republicans new healthcare bill could mean a $19 million a year loss in federal reimbursements to Rutland Regional Medical Center.

Listen to the VPR interview with Tom Huebner about the effects of the currently proposed health care reform bill.

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Bipartisanship is the Answer — July 3, 2017

The Legislature in Washington, D.C. is now in recess for the July 4th holiday, returning on the 10th of July. The Senate left our nation’s capital without passing a bill to replace Affordable Care Act, also referred to as "Obamacare." This failure has brought some relief to us, but it is temporary relief at best. Make no mistake, the Senate bill, as written, would have seriously undermined our organization and our ability to deliver the quality care we are committed to delivering to our community.

So now what? Certainly the members of both the House and the Senate are hearing from their constituents during this recess, and we’ll have to see if they have heard anything that might affect what they do next.

I believe that there are three possible ways forward:

  • First, the bill may come back after the 4th of July with some slight revisions and move forward in a way that I do not yet see, but it is quite possible. Senator McConnell is a very capable tactician. If the bill changes only a little it would still not be good for Rutland Regional and our patients.
  • The second possibility is that they do nothing. That too is really not a great outcome since there are fixes to the healthcare exchanges that really need to be made. This is especially true in other parts of the country where there are very unstable insurance marketplaces. Some of the fixes will indeed require Congressional action. I hope doing nothing is not the course.
  • And then, there is the third opportunity, perhaps to do something on a bipartisan basis; to do something that does fix the exchanges and repair parts of the Affordable Care Act that could really use improvement. Wouldn’t it be great to see some bipartisan activity? I fear that if we do not get to a level of bipartisanship, that we will keep rocking back and forth between two extremes.

We’ll see, of course, how this plays out. In the meantime, the right thing happened last week. People slowed down and are now reconsidering how to move forward. I certainly hope that fair and effective progress can be made. We shall see.

Awaiting Impact of the New Healthcare Bill — June 26, 2017

Last week, the Senate bill on changing the Affordable Care Act was introduced. Regardless of one’s political position, make no mistake, this bill will have a dramatic effect on the number of people covered in Vermont, and it will substantially reduce Medicaid reimbursement. We are all awaiting the Congressional Budget Office to "score" this legislation to see exactly how large this impact might be. Senate leadership is pushing to have a vote later this week. If they vote "yes," and then the House accepts that vote later in July, this will have substantial impact on Rutland Regional Medical Center in the years to come. This impact will be negative and as a community hospital we will have to find ways to serve our community while remaining financially sound. This is the cold hard reality of not just Rutland Regional, but of countless hospital systems across the country. As your community hospital, we join the Vermont Association of Hospitals and Healthcare Systems and the American Hospital Association, as well as our healthcare colleagues across the country, in vocalizing our collective opposition to this bill and any bill that hold provisions that will seriously affect the health outcomes for our respective communities. The Vermont Congressional delegation has aligned their messaging with ours and will oppose this bill. We hope that Congressional leaders across the country will hear from their constituents and that they will encourage their legislators to oppose this bill as well. This is a big week in healthcare. Stay tuned and stay engaged.

A Sobering Assessment — June 19, 2017

I spent the last two days of last week at the American Hospital Association Regional Policy Board meeting. It was sobering. The AHA believes there is a real possibility that the Affordable Care Act will be repealed and perhaps replaced. It is not certain that this will occur but it is a significant risk. The Senate hopes to pass their bill before the July 4th recess and they will then tell the House of Representatives to either take it, or leave it. If It passes the Senate it will be with the slimmest of margins. It became further clear to me that not only would Vermonters lose coverage if it passes, but it will also impact our reimbursement. I estimate that 60,000 Vermonters would be without insurance by 2020 and that our Medicaid reimbursement could fall, perhaps as much as 25%. Again, the details are not certain. There is a lot of negotiation still going on, but that would be a devastating amount. A 25% reduction in Medicaid reimbursement would be about 8 million dollars. It reminds us, yet again, of the need to support the Affordable Care Act, first for the good of our patients, but second for the good of our organization and the care we provide for our community.

A Balance of Services — June 15, 2017

Vermont’s health care system is one of the most regulated in the country. This framework has helped to contain cost and expand health care in a thoughtful and responsible way. The Green Mountain Care Board (GMCB) is responsible for determining if new health care facilities are truly needed to enhance the health care system for all Vermonters.

The addition of an ambulatory surgical center (ASC) in Vermont like the one being proposed in Chittenden County is precedent setting. If one is approved in Chittenden County I worry that Rutland would be next. For mid-sized and critical access hospitals in Vermont, which operate tight financial ships, there is little margin to manage the impacts of new and unregulated competition.

On behalf of the hospital I lead in Rutland, I am concerned about the effects an ASC would have on our hospital and community should one eventually be approved in our area. ASCs do not take all comers like Rutland Regional does. At Rutland Regional we accept all patients, no matter their ability to pay. This means that often we provide free and uncompensated care to our community. This is what hospitals do—this is what taking care of a community’s needs looks like. ASCs do not have to be up and running 24 hours per day, 365 days per year to meet all the needs of the community like a hospital. They can focus on only the easier, more profitable services. That makes it very difficult for a community hospital to survive.

Unlike Vermont’s hospitals, the ASC would not be subject to the annual tax that funds our state’s Medicaid program. The ASC would not answer to the GMCB’s budget process or financial oversight; nor would it be subject to state licensing requirements or reporting requirements.

The fact is, Vermont has limited the amount of capacity in the system through tough but fair regulation as a way of containing costs and ensuring access. More buildings, especially unnecessary ones, equal more cost. In a small, highly regulated rural state, an investor-owned surgical center would absolutely affect the strength of some hospitals and the services we’re able to provide. In Rutland, we have expanded our capacity to meet demand and done so within the confines of the CON process. We had to prove that there was a genuine unmet need in our community. Any ASC should do the same.

27 years ago, when I joined Rutland Regional, the vast majority of services were inpatient. Now 60% of the care we deliver is on an outpatient basis. In 1990, a patient receiving a total hip replacement would be in hospital 12 days. They are usually now here for 24 hours. Technology improvements have driven many of these changes. But the needs of our community have changed as well. We now provide a wide array of behavioral health programs like the West Ridge Center for Opiate Addiction. Not all of these services are financially self-supporting, but our community needs them to be provided. To make investments like this for our community we also must be allowed to balance them with services like ambulatory surgery.

Here in Rutland, our hospital is investing in health care reform, addressing the opioid crisis, grappling with symptoms of poverty, and partnering with community providers and other hospitals to expand telemedicine and specialized services for our neighbors living with mental illness and chronic diseases.

There is a tremendous amount of work ahead, but together with our provider partners, state leaders and so many others we continue to make progress. I hope that we fully understand the implications of allowing for-profit surgical centers on all stakeholders before we set a precedent that could have a significant impact on our forward progress.

Protecting Your Healthcare Coverage — June 12, 2017

The political world keeps on churning and changing. The US Senate is trying very hard to complete work on a repeal and replace bill by the Fourth of July recess. They want to have the bill to the Congressional Budget Office for scoring before they depart. A big stumbling block still, is whether they are going to allow Medicaid expansion to continue and to provide adequate funding for Medicaid programs. Some other issues might moderate, but that is the key discussion point at the moment. We believe that coverage of individuals in Vermont and across the country should not diminish. The American Hospital Association, the Vermont Association of Hospitals and Health Systems, and Rutland Regional are all positioning and fighting to maintain coverage for our patients. We believe this is in our community’s best interest and we do this without apology. Please contact one of our State Senators, Sen. Patrick Leahy and Sen. Bernie Sanders, or Congressman Peter Welch, and thank them for their support of these positions and encourage them to keep fighting for your healthcare.

RUTLAND REGIONAL MEDICAL CENTER160 Allen Street, Rutland, VT 05701802.775.7111

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