Healthcare regulation elicits blowback, Vermonters need to respond

Courtesy UVM Medical Center Hospital

We don’t like change. Change threatens those of us who are privileged to have a part in the status quo, even when it’s dysfunctional and unsustainable.

In 2022, the legislature passed Act 167 commissioning a systemwide analysis by Oliver Wyman Associates. As statutory partners, the Green Mountain Care Board (GMCB) and the Agency of Human Services (AHS) committed to creating a sustainable healthcare system in Vermont based on their findings.

As a former board chair of the Burlington hospital regulated then by BISHCA, now the VT Dept. of Financial Regulation (DFR), the sad irony is that so few Vermonters bothered to read beyond the headline in the Oliver Wyman Report. Wyman. Report leader Dr. Bruce Hamory reported that the system is irrevocably broken and financially unsustainable as it is now and would require another $1.4B in public investment to prevent the collapse of most of our hospitals.

But he then went on to specify in depth how we can transform the network of Vermont hospitals into a sustainable healthcare infrastructure that delivers on population health – quality, access, and affordability, that strengthens our communities, and that invests upstream in prevention, education, and primary care.

But the new chorus of opposition conducted by the principal hospitals serving their own interests while claiming to serve the interests of Vermonters, most of whom cannot afford healthcare, healthcare insurance, or if they can, cannot schedule timely access, is flooding media outlets.

Since the Oliver Wyman report came out and the Green Mountain Care Board provided its most recent regulatory guidance to Vermont’s hospitals, especially UVM Medical Center Hospital (UVMMC), a ginned-up chorus of organized media whining has begun around the state.

• Grace Cottage Hospital Blasts report’s “Ill-conceived ideas,” reports The Commons of Brattleboro.
• “On Friday, the Board informed UVM Health Network that they would be penalizing the Network for providing increased care to our patients,” UVM Health Network spokesperson Annie Mackin said in an emailed statement.
• “UVM Medical Center postpones surgical center construction, citing regulatory decisions.” In VTDigger.
• “We are totally in favor of fair, transparent regulation,” Eappen said. “The problem is that if you don’t do it in a really consistent, fair, collaborative manner, we get into these situations where people don’t understand each other.” He left open the possibility of legal action if the board moves forward with its current plan. “We will explore every possible venue to protect Vermonters in doing this work,” he said. 
• In a recent UVMHN Town Hall on October 10^th conducted by Dr. Sunny Eappen, he stated (and I paraphrase) that the GMCB was wrong and short-sighted when it penalized UVMMC for providing care for more patients than budgeted for, while failing to mention that UVMMC also exceeded the regulatory limits on commercial insurance billing. He was also heard to say that UVMHN has asked Oliver Wyman Agency and Dr. Hamory to retract the statement that “an outside opinion stating that UVMMC’s administrative expenses were substantially above their peers,” adding, “We will do everything in our power to change this decision including publicly, legislatively, and legally.”
• And the largely ignored blog of author Hamilton Davis, A Vermont Journal, trumpets “A Consultant’s Utopian Fantasy Imperils VT Healthcare Reform.”
• North Country Hospital recently called a press conference to discuss with their community the Oliver Wyan report recommendations. The hospital’s CEO Tom Frank said he was shocked by the suggestions made. “When you make the recommendation of no OB services, when you make the recommendation of no orthopedics services, when you make the recommendation of turning our ED into a 16-hour urgent care and to turn our in-patient beds into mental health beds, that’s basically saying close the hospital,” Frank said.
• Frank further elaborated his dissent in a recent VTDigger commentary.
• Robert Gardner’s commentary in VTDigger: Closing Gifford Medical Center would deeply damage the region: “The radical and ill-conceived proposal to close Gifford Medical Centeras part of an overall plan to reduce health care costs in Vermont reminds me of a good friend who was suffering from cancer and was given very aggressive chemotherapy. He was cured of the cancer, but the chemotherapy killed him.”
• Perhaps more predictable was a column the CEO of VAHHS, the trade organization representing the interests of hospitals posted in Vermont Biz.
• In fairness, a citizen Richard Dalton of South Pomfret, wrote an informed response in VTDigger. “The medical center in Randolph cannot survive financially. As the cost of health care soars nationally, local, rural health care will suffer as population demographics shift and continue to decline. Without the adequate number of daily patients, these rural communities cannot support medical centers like Gifford.”

The beat goes on…

The very people who make healthcare work: nurses, technicians and support staff, however, in a blistering challenge to Dr. Eappen recently wrote:

Dr’s Eappen and Leffler,

Your Town Hall and emails to staff regarding GMCB’s decision of a 1% decrease for fiscal year 2025 for UVMMC’s budget have not been received well. While we are sure it is difficult for you to hear that rates will not be increased, the GMCB has an obligation to help lower healthcare costs in our state and to ensure the hospital is fiscally responsible. Attempting to fear monger and turn staff against the GMCB is the definition of bullying behavior we have come to expect from the UVMHN. If it was also meant as a scare tactic, the hospital has succeeded in causing staff to become alarmed.

And

The top FOURTEEN administrative network position salaries total $8.6 million in 2023 with approximately $1.2 million in bonuses the previous year. It makes us speculate on what these top network positions salaries will be in 2024 when the figures are released and when UVMMC is currently threatening to diminish staff based on the GMCB budget decision. These figures do not include each individual hospital’s top administrative positions either, so a significant portion of salaries are not included in those totals. If we can afford these salaries, then we can surely find

funds for bedside staff and non-patient facing staff who dedicate themselves to providing care for our community.

We need true leadership, not finger pointing and blame. This is the hospital’s opportunity to rise above, not sink below.

Our patients, staff and community deserve better.

Unlike the plutocrats of a $4.5 trillion dollar national healthcare industry, the average citizen in need of healthcare doesn’t have the organizational lobbying capacity to exert much influence on reform.

The groundswell of opposition to restructuring and regulation in service to the mission of population health being generated by those who fear they will lose their lucrative privilege in a redesigned system must be countered by the voices of Vermonters who need and deserve a more accessible and affordable system. Every Vermonter who wants a functional, affordable system must make their voice heard.

The opposition must also be held to account in the face of unimpeachable new data that shows in detail the need for such reform. Using federally available data, Tom Rees and Associates have tracked declining fiscal performance trends in the decade between 2013 and 2023:

1. Total gross salary costs at UVM increased 103% while peer hospitals experienced less than half that at 46%.
2. Total adjusted patient discharges dropped by 13% from 58,000 to 50,000 whereas comparable systems had a 23% increase in the number of discharges. “Total Adjusted Discharges” here means the number of inpatients adjusted to reflect the number of inpatients and outpatients treated.
3. Direct patient care labor expenses at UVM grew by 91% whereas comparable systems increased on average 64%. This is labor costs attributable solely to caring for patients.
4. Total non-patient care labor cost increased at 122%, more than double that of peers at 55%. This is all labor except patient care (No. 3.)
5. Non-patient labor adjusted salary expense grew by 156% while their peers grew by 27% and other Vermont hospitals only grew by 35%. This is labor costs having to do with any and all services not directly related to patient care such as management and administration.

In sum, while patient discharges shrank, overall expenses at UVMMC grew between 81% and 122%.

Vermonters can and must weigh in. Solo voices can be amplified by submitting opinion pieces in local news media, attending meetings (such as Mr. Dalton’s above,) written testimony to the Green Mountain Care Board (GMCB) or testifying to the Senate Committee on Health and Welfare or the House Committee on Healthcare. Simply contacting your local legislator and expressing your direct concern can also be effective. For specific concerns, one can also reach out to the Healthcare Advocate.

The Green Mountain Care Board is a regulator and guide on this path, and the Agency of Human Services is the change agent, both empowered in statute to bend the curve to affordability and access while maintaining quality.

It’s time for Vermonters to make their concerns heard. Together, we can advocate for and achieve a better healthcare system even in the face of strong defensive headwinds.