Representatives John Tracy (Co-Chair), Steven Maier, Janet Ancel, Francis “Topper” McFaun; Senators Jim Leddy (Co-Chair), Ann Cummings, Jane Kitchel, Kevin Mullin; John Bloomer, Jr.

MEMBERS ABSENT:

Walter Freed

Also Present:

Legislative and Joint Fiscal staff, members of the Administration, the press, and the public.

Meeting Recorded:

CD HCRC 7/25/06 , CD #1, 2, 3.

1. Convene; Review and Approve Minutes from June 19, 2006

Senator Leddy and Representative Tracy convened the meeting at 9:45 AM in Room 10 at the Statehouse, Montpelier , Vermont . Sen. Leddy asked for a motion to accept the minutes. The motion passed unanimously.

2. Review Commission responsibilities, reports due, etc. Robin Lunge, Legislative Council

Document distributed: Key Reports due to or of interest to the Health Care Reform Commission—Fall, 2006

Robin Lunge explained the list of 24 reports and documents. [post this list on web?]

3. Implementation Susan Besio, Director of Health Care Reform Implementation

Documents distributed:

• Vermont Health Care Reform Initiatives: Lead Contacts for Major Tasks

• Spreadsheet: List of Health Care Reform Activities in 2006 Bills Signed into Law: Sorted by Lead Department

• Spreadsheet: List of Health Care Reform Activities in 2006 Bills Signed into Law: Sorted by Date and Topic

• Rules for Implementing Employer Contributions to Health Care: Timeline, July 24, 2006

• CMS Waiver Amendment Request for Premium Assistance: Timeline, July 24, 2006

a. Susan Besio said that the list of Lead Contacts for Major Tasks will be on the Administration’s website.

b. She distributed two spreadsheets listing and organizing Health Care Reform Activities, one sorted by lead department, and one sorted by date and topic.

She talked through the early events on the timelines.

c. She explained the timeline and process for creating the Rules for Implementing Employer Contributions to Health Care.

For the Dept. of Labor rules process, Susan and Tom Douse will co-chair a group on the seasonal employees issue. She has asked Rep. Ancel and Sen. Mullin to sit in on these meetings. The group includes representatives from the business community.

The Common Claims and Procedures group has started.

d. She distributed and discussed the CMS Waiver Amendment Request for Premium Assistance. This is the waiver amendment to 1115. The goal is to have that draft done by Sept. 1, 2006 . CMS has three months to respond. In the discussion, HCRC (Commission) members asked OVHA Director Joshua Slen to send CMS a memo to explain what Vermont is planning—to make sure that all is OK with CMS.

Besio said that implementation is progressing. She has met with almost all the lead people in the process; agencies are having multiple meetings—BISHCA, Economic Services, OVHA—have many interacting issues.

BISHCA, VITL and Hans Kastensmith are also meeting regularly re Information Technology; BISHCA has met with MVP and BC/BS.

One key issue: clarify all the base numbers and assumptions re projections, especially around ESI eligibles, etc. She is working with JFO, Economic Services and BISHCA. They are getting close to agreement that the BISHCA Survey is the best data source. They will refine this next week with Steve Kappel; and soon will have consensus on the numbers, and on the estimates on how many people may access Catamount Health.

She is contracting with Sherry Glied at Columbia University Mailman School of Public Health: for advice on enrollment and program design issues.

Susan can bring flow charts to the next meeting if the HCRC would like.

The committee has been established for health & wellness—Barbara Cimaglio is leading this.

Q: Work on counter detailing? OVHA working on this? It has been an area of legislators’ concern.

Besio will look into this.

Topics on the spreadsheet: they are listed the way Besio is viewing them—overarching themes. She will use these in developing materials, and this is the way the website will be organized. The website will have information on key contact people, work plans, meetings minutes, etc.

Sen. Leddy said he is impressed by how quickly and thoroughly Susan Besio has moved into this role. The work is massively complex. He is very pleased with both her enthusiasm and approach. He said he wanted to state publicly that he is concerned that we are asking a tremendous amount from people in the Administration. Very pleased and satisfied, but aware that challenges will continue to grow. We don’t want to delay or fail due to lack of resources.

Financing studies: Jeff Carr will be participating as a reviewer of study assumptions. Conversations have involved Besio, JFO, Tom Kavet, Carr, Mike Smith and the Governor. They are trying to find a way for Jeff to be involved but still be supportive of the Governor’s position re no tax increases.

Re BISHCA survey and its data: a group has been reviewing this—Ken Thorpe and Steve Kappel will review it again next week.

OVHA will do a survey re possible enrollees.

Re OVHA Chronic Care Management RFP: not ready for the HCRC yet; they are getting more input as they prepare a draft—they plan to put it out for comment.

To clarify Jeff Carr’s role: He will review assumptions and data sources for this model. But he will not participate in the work itself.

Sen. Leddy: We wish it were otherwise.

Rep. Ancel: Very unfortunate that we will not get the collaboration between the two economists—this has been very helpful in the past.

Rep. Tracy: This is a missed opportunity—we had wanted to work with the Administration on this.

Rep. Maier: Urged Besio and economists and others to get to basic agreements as soon as possible—and realizes that Besio understands this too.

Besio: There are two sets of data.

1. Population estimates—who will access ESI, Catamount. That workgroup is very close to agreement on the numbers.

2. VHAP Survey

John Bloomer: It is actually important that Jeff Carr will be involved in the assumptions. So what the Administration has offered should be helpful.

Sen. Kitchel: We do have a hidden tax at work: the cost shift. This is important to understand and acknowledge. There is a taxing mechanism at work already—and nit has been quantified. The cost of doing nothing is very substantial.

[track 3]

3.a. VHAP Survey: Update on the Population and Household Survey Diane Kahn, Director of Data Analysis, BISHCA ; Betsey Forrest, deputy commissioner of the Department of Children and Families, for VHAP

Dian Kahn gave a quick history of the BISHCA survey. The key issue is transparency in developing the survey, and transparency in the analysis and reports.

They held sessions in June to review the data in detail. Three areas in particular:

• Self-reported family income—was there under-reporting?

• Medicaid enrollment numbers—possibly 10% over

• Re-checked Medicaid eligibility simulation model.

The various analyses and recalibrations showed that the data aligned very well. The BISHCA survey data is generally better than federal census data.

The group reviewing the data included Steve Kappel of JFO, Rob McIntyre of the Dept. of Children & Families at AHS, and Jan Westervelt of the Dept. of Finance & Management.

Kahn said the BISHCA Survey is timely, relevant and well-populated.

Re the VHAP Survey: they may be able to use BISHCA data already gathered; if this does not work out they will do another survey. There are about 25,000 adults and 5,000 children eligible for Medicaid—when this is adjusted for moving in and out of coverage, it’s about 20,000 adults.

About 40% are uninsured for over a year.

Re the final version of the BISHCA survey, they will have summary data available in about a week or so. The HCRC will receive copies once the summary is done; there are also extensive data tables.

3.a. Continued: Betsey Forrest re Employer-Sponsored Insurance (ESI)

Betsey Forrest gave a quick addition to Kahn’s presentation.

Re the ESI analysis, they have phone numbers and demographic information—will have what data they need to answer the question in the statute. They hope to be able to match and use current BISHCA data. If not, they will need to do another survey. Their sample size will be adequate.

3.b.Expedited BISHCA Rules Brian Leven, Legislative Council; Cassandra Edson, Legislative Council

BISHCA is using an expedited rulemaking process; there are various precedents in Vermont rulemaking. Cassandra Edson discussed the planned timeline for the process. Draft rules were supposed to be effective Aug. 1. Though BISHCA will not be able to comply with that deadline, there should be sufficient time for all the necessary steps to occur in time for the policies to be ready to provide coverage by Oct. 1, 2007 .

The process requires notices in papers of record, comment and discussion period for 14 days. (The draft rule is posted now on the BISHCA website.)

The process then requires review by Legislative Committee on Administrative Rules (LCAR). They have scheduled meetings for Aug. 9 and 30; can also schedule a special meeting.

Then 14 days for LCAR to review, then their response to BISHCA.

Then BISHCA can file rules with Secretary of State; set deadlines for insurance providers to file plans for forms. Then five months—this at the outside would take the process to early March.

Then BISHCA reviews providers’ materials, then must approve or disapprove within 45 days. The process is on track for insurance companies to begin marketing next June or July, at the longest.

Policies should be ready to provide coverage for Oct. 1, 2007 .

So the window for public information re policies etc., is roughly 6/10/07 or 7/1/07 through 10/1/07 .

Signing up can start before 10/1/07 . After someone signs up, the review and processing can take 15 to 20 days.

One area where BISHCA draft rules need to be changed: premium rate approval standard—Herb Olson will address this.

Sen. Leddy recommended that the HCRC for a sub-committee to review the proposed BISHCA rules—meet with Cassandra, etc.—and do this before the LCAR meeting. This is a very important step, and the HCRC needs to be fully informed. (Sen. Cummings noted that she serves on LCAR.)

Expedited Rules subcommittee: Topper McFaun, Janet Ancel, Jane Kitchel, Jim Leddy.

3.b., cont. BISHCA’s process for adoption of the rules Herb Olson, General Counsel, BISHCA.

Documents distributed:

• Vermont Department of Banking, Insurance, Securities and Health Care Administration: Rule­­­­______: Catamount Health Insurance

• Memorandum: Administrative Rules Relating to Catamount Health Insurance Policies, July 13, 2006

These rules are a very important first step; important to be clear and open, while at the same time moving as quickly as possible. As BISHCA drafted these rules, they met with key people who will be implementing the rules, and others: JFO, Leg. Council, insurers, people with reimbursement issues, hospitals, providers, and AHS—who will design programs.

BISHCA noticed the Rules to papers of record last week; comment period ends Aug. 1.

Held a public hearing last Friday.

Four key issues are emerging as they receive comments:

1. Standards for reimbursements to hospitals

2. Chronic care management—consistency with programs that have yet to be developed.

3. Eligibility rules—may need to include extra screening.

4. Unsubsidized cost of premiums—expectations in this area.

They hope to get materials prepared and submitted to LCAR by Aug. 2, but if necessary will submit a week before the Aug. 30 LCAR meeting instead.

Commissioners: Important to take the necessary time up front. Need to have clear agreement among the parties before LCAR review.

So possible the Aug. 30 LCAR meeting is a better target. This will also help the HCRC subcommittee plan its review.

Olson: Re HCRC review: please discuss the rules with OVHA as soon as possible.

The timeline presented by Cassandra Edson is a worst-case scenario—the process may take a shorter time.

Sen. Kitchel: Re the issue of migration—“building walls” re access and eligibility—this is important.

Olson: BISHCA is addressing this in the rules to the extent possible. Intent: Catamount Health policies are intended for v\uninsured Vermonters. But need to maintain the viability of existing markets. Th ere is some flexibility, but the statute is pretty clear.

Q re universal immunizations addressed in the statute?

A: A BISHCA representative is attending DOH work group on immunizations—many areas still being developed—not ready yet.

Olson: Stepping back from the session, this is a terrific piece of legislation. BISHCA staff are dealing with it with enthusiasm. He encouraged HCRC members to contact BISHCA at any time.

Olson introduced the new BISHCA Deputy Commissioner for Health Care Administration, Christine Oliver.

3.c. OVHA--Medicaid Chronic Care RFP Joshua Slen, Director, OVHA

Document distributed:

Chronic Care Management RFP Development Process, 7.20.06

Joshua Slen noted that OVHA is also constructing the Waiver amendment.

In the Chronic Care RFP process, they are now in the Phase 4 piece, OVHA internal draft RFP review.

Phase 5 is a limited stakeholder RFP draft review. Could the HCRC make a subcommittee to review this document and work with OVHA?

They will have an RFP available to the HCRC for review before the September HCRC meeting. At this point, OVHA is on track. It is an aggressive timeline, and they are moving forward rapidly.

Sen. Leddy: Again, wants to express appreciation for how hard Administration staff are working on this, and also appreciates the extra work BISHCA staff are being requited to do.

HCRC sub-committee to work with OVHA: Reps. Ancel and Maier, Senators Mullin and Leddy.

4. Update on Maryland "Wal-Mart" ruling Maria Royle, Legislative Council

Documents distributed:

• The court decision: U.S. District Court, Maryland : Retail Industry Leaders Association v. James D. Fielder, Jr.

• Summary of the Court Ruling on Maryland ’s Wal-Mart Health Care Law

This is the first federal court decision on a “pay or play” model. The court struck down the Maryland law. The court said it had an impermissible effect on ERISA plans. It was a mandate on Wal-Mart and therefore a violation of ERISA preemption.

Implications for Vermont : We are in a different federal court circuit, but it is a precedent. But the Vermont law is different. In the Maryland case, the court could have gone either way. Re possible challenges to the Vermont law: employers would not have to wait until implementation to challenge.

Rep. Maier: This decision could actually be positive for Vermont .

5. Vermont in a National Context; and update on Commission studies Kenneth Thorpe, Consultant to the Commission

[track 7 on cd]

Document distributed: PowerPoint slides: State healthcare reform: Is Vermont different?

Context: The healthcare reforms are broader in Vermont than anywhere else in the states, but Vermont can also learn from other states.

New state activities:--in three states:

• Vermont (Catamount Health and the Blueprint)

• Illinois (“All Kids Health Insurance Act”)

• Massachusetts (individual mandate)

In the three major areas of covering the uninsured, making health care more affordable for the insured, and improving the quality and value of health care delivered, only Vermont has done all three.

Improving the quality and value of health care delivered could be the most important part of the Vermont legislation. The only other model for this is the Veterans Administration health care system.

Thorpe discussed the challenges facing the DIRIGO Choice program in Maine —how do you communicate, how prepare for enrollment; and the challenges facing Massachusetts : they haven’t defined their policies and haven’t defined their subsidies. For Mass. , all the big financial and economic decisions still remain to be made.

The good news is that Vermont has taken on the health care reform issue all across the board—it is broad and comprehensive. The bad news is that it is more complicated and challenging because of that—and Vermont is the pioneer.

A major challenge: how do you get folks to enroll?

Thorpe discussed the various healthcare studies.

Three areas.

• As heard from Susan Besio—the ongoing analysis of the Catamount Health program—ESI, eligible individuals, assumptions, data.

• Study on implications of moving to a single-payer system in Vermont —the possible impacts. This requires data like the BISHCA study—and other data sets, individual payroll data, etc. Thorpe is working with Tom Kavet and his assistant Nick Rockwell.

They want to work with the Administration to the extent possible.

They expect to have a preliminary report ready for the next HCRC meeting is late August. He will need to use his original data sets, not the BISHCA data—unfortunately, there is not enough time to re-code that data.

• Third study: “Economic and Financing Study” re different ways to pay for healthcare, and possible impacts on Vermont . This is due in the fall.

Comment: Re penalties in Mass. Re individual mandates: tax penalties are actually quite modest.

Comment: In Maine , the biggest problem was the issue of voluntary enrollment.

There was more discussion re the involvement / lack of involvement of Administration economist Jeff Carr. Thorpe said it is important to try to agree on some assumptions—social assumptions, behavioral parameters; economic assumptions re employer behavior—this is the key part.

Involvement of an actuary…

Re the second study---single payer impacts—make sure to get HCRC input in exactly what you want to see studied. Re possible benefit plans—would hope to consult with industry actuaries, hopefully consulting with the actuaries the Administration is using.

Concern expressed that the “way to finance this” piece is being taken off the table, with the Administration economist net being involved.

Discussion: No matter what the Administration’s engagement is in the process, the HCRC plans to look at all options—including single payer, and others.

The HCRC’s intent was to try to be cooperative and to work together, to the extent possible.

Sen. Leddy: We need to deal with reality here—look at the legislation we have produced. As we more forward, there was a predictable area of friction.

Thorpe: It will be critical to get agreement on data and methods, behavioral assumptions. After that, we can discuss policy. That is the intent.

Comment: It will be important to define areas where there has been disagreement on assumptions, and make them clear to the HCRC.

Comment to Besio: clarify your comment that Jeff Carr will review data based on the Governor’s position?

Besio: The governor has been clear re “no new taxes”—so does not want to put his resources in area that he will not support.

Sen. Mullin: It is important to look at the overall financial burden, not just taxes—there are all the hidden costs.

[CD #3]

Tom Kavet: We are building the assumptions. It will be important to meet with Susan Besio to discuss this process. He has worked before on a similar contentious issue: business tax subsidies. Were able to take and deal with some technical issues and get them off the table.

6. Commission Overview Report Catherine Benham, Joint Fiscal Office

Benham: One contract is signed, and they are almost done with the other. Are discussing coordinating web pages with Susan Besio; are also discussing coordinating getting information out to the public.

Reimbursements for HCRC commissioners who incur expenses on Commission work:

She suggests the HCRC approve reimbursements to members for their work, with the approval of the co-chairs.

(Discussion of the HCRC’s role in communicating re implementation—we need to get more pro-active—offer HCRC as speakers to Rotary clubs, etc. As much as possible, we need to involve Susan Besio and the Administration in getting out the information with one voice.

Motion: members will be reimbursed for travel and meals, and per-diem, with the prior approval of one or the other of the co-chairs. The Commission approved the motion.

Sen. Leddy noted that Commissioners who have already incurred expenses will be reimbursed also.

NEXT MEETINGS:
Monday, August 28, 9:30 AM .
Tuesday, September 26, 9:30 AM .
Tuesday, October 24, 9:30 AM .

We also need to plan more time for each meeting—plan to go to 2:00 or 3:00 .
The commission also needs to set aside some time in each meeting for some open public comment.

The meeting adjourned at 12:55 PM .

Minutes respectfully submitted by Loring Starr

Home