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., Walter Freed

MEMBERS ABSENT:

None

Also Present:

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

Meeting Recorded:

CD HCRC 10/24/06, CD #1, 2, 3.

Documents Distributed:

Minutes of Sept. 26, 2006 meeting

1. Convene; Review and Approve Minutes from 9/26/06.

Senator Leddy convened the meeting at 9:45 AM in Room 11 at the Statehouse, Montpelier, Vermont.

Sen. Leddy asked for a motion to accept the minutes. The motion passed unanimously.

2. Medicaid Deficit Update [CD 1, tr. 2]

Stephanie Barrett, JFO

Documents distributed: Medicaid 5-Year Projection, Based on Waiver Years (updated);

Issue Brief—Revised October 2006: FY08 Medicaid Deficit Update.

Overall: there is a 7% to8 % growth rate in the program. Deficit projection has been revised downward since the projection in May. The actual FY08 deficit figure reported in May was $43 million; now as of October it is $11.6 million. But 44% of the total estimated deficit reduction for FY08 is due to one-time funds. This is why the estimated deficit grows significantly in fiscal years ’09, ’10 and ’11.

Stephanie noted a few caveats: Catamount estimates are not updated; the State Hospital assumption in FY09 and other information will be updated again in January.

There was considerable discussion about assumptions in the model, such as growth rate in the overall economy, etc.

3. Blueprint Strategic Plan [CD 1, tr. 3]

Sharon Moffat, Acting Commissioner, Vt. Dept. of Health

Document distributed: Blueprint Successes

Sharon Moffat updated commissioners on the Blueprint for Health Interim Strategic Plan (Report to the Legislature on Act 191, October 1, 2006)

Available on the Web at http://healthvermont.gov/admin/comment/Blueprint_strategic_plan.pdf

Earlier versions of the Plan focused on one chronic illness, diabetes; this Interim Strategic Plan has a broader focus on all major chronic conditions. Moffat noted that several members of the Blueprint’s Executive committee are present today: Joshua Slen, Paul Harrington, and Christine Oliver. The Executive Committee uses this plan as a working document: are we meeting benchmarks?

They intend to get further public comment on the Plan, including using Interactive TV.

The Plan focuses on areas—such as community—including how we need to connect with CHAMPS to make changes for Vermonters’ access to health care.

Work with the 211 line. Health care providers use the 211 line with clients, to find what’s available in their area. This is a critical partner.

The other major focus is self management.

Moffat discussed Blueprint accomplishments to date. These are in six areas: community services, public policy, self management, provider practice, health systems, and information systems. The complex contracts re information systems have just been signed. In the other areas, there is lots of work to do re health systems—pay-for-performance, disease management reporting, and coordination with insurers.

Regarding the overall Blueprint management structure, they have added members to the executive committee, including representatives from FQHCs (federally-qualified health centers) and naturopathic physicians.

There is lots more to do ahead of us.

She noted concerns re getting more public input—this needs to be a statewide initiative, not just a “Health Department project”.

The Blue Cross-Blue Shield conference this fall will focus on the Blueprint—that can provide opportunity for input on the Plan as well. The date is Nov. 6. There was discussion of outreach challenges—there are many “publics” in this area. Commission members urged the Department to structure and guide comments and feedback.

4. CHAMPPS (Coalition for Healthy Activity, Motivation, and Prevention Programs)

Sharon Moffat, Acting Commissioner, Vt. Dept. of Health [CD 1, tr. 4]

Department of Health has convened individual program managers, who are doing grants—to avoid duplication/redundancy. They are also inventorying all other agencies doing these kinds of grants: including Transportation, Agriculture, and Education. The CHAMPPS Advisory Committee is meeting. By spring, they will have an RFP, which will invite communities to submit one proposal, combining all their activities. District health directors are helping communities to access data and sources of information, and how to use it. CHAMPPS is looking at other state models, including Maine—for example, Maine is using hospital service areas for their districts.

Q re the other community initiative program –also a broad RFP?

A: For this they are using a different approach. They are now drafting the RFP, and will send this one to a targeted group of communities.

Q re connection between the Blueprint and Catamount Health—how is this happening? How and when are they being connected?

A: From reviewing results in other areas, such as Puget Sound, and Alberta, Canada: they are learning that it takes a year or so to get these connections set up—then adoption follows more quickly. As soon as Catamount is set up, Blueprint will be ready. They will add in various chronic diseases to be managed.

Q: Concern that rollout is not happening fast enough.

A: Sharon will take this concern back to the Executive Committee—again, adoption does take time.

From the pilot areas of Bennington and St. Johnsbury, the feedback is, be cautious—it will take at least a year.

Q: Sen. Leddy: A real opportunity here to pull together a host of existing resources that are currently fragmented. His suggestion: encourage private insurers to invest $1.00 per covered life into prevention… a possible way to leverage more money.

Sen. Leddy noted that overall this is indeed a great challenge for the Health Department—and extended the Commission’s thanks.

5. Joint Fiscal Office ESI Evaluation and Report [CD 1, tr. 5 and CD 2, tr. 1]

Steve Kappel, JFO

Don Dickey, JFO

Background on ESI: Uses public dollars to subsidize the employee share of employer-sponsored insurance (ESI). There are tests to assess employer plans for adequacy of coverage. Three main areas:

• Scope of benefits
• Affordability to beneficiary
• Cost-effectiveness

There are two ESI components: the people who are going to move from VHAP to ESI (both current and new enrollees) and the people who sign up for Catamount but go onto their employer plans.

The ESI Report is due from the Administration Nov. 15. Funds for ESI have been appropriated by the Legislature. A meeting is scheduled for Nov. 27 re the final appropriations.

There are two ways to look at it:

1. other states’ experience –Don Dickey will present information on this
2. Vermont-specific information

There are several big policy questions.

1. Eligibility
1. Folks currently on VHAP
2. New folks coming in to VHAP—how many?
3. Take-up rate: we need estimates
2. Re employer plans:
1. What does “substantially similar” mean?
2. Can a “wrap” help?
3. Cost effectiveness
1. Who to move, and who to keep on current state programs?
2. Uncertainty
4. Critical budget piece: the projected savings
1. Current VAHP people who will move to employer plans
2. A new group of people--“Foregone costs” –potential cost avoidance
5. Broader ESI effects
1. On insurance companies
2. On employers—could be larger changes than they expect
3. Cost shifting:

• From state programs to commercial insurance
• Non-covered people who will start coverage and care

1. What CMS will choose to do
2. Cost and complexity to administer, and barriers to joining
3. Effects on beneficiary health

JFO will prepare and share a report.

Don Dickey:

Document distributed: Premium Assistance for employer-Sponsored Insurance (ESI): Experiences in Other States. VT JFO, Don Dickey, 10/15/06

This issue brief examines the experience of other state Medicaid programs that have developed ESI premium assistance initiatives, with a focus on enrollment. It is intended to provide context for the forthcoming analysis of the costs and benefits of a Vermont ESI premium assistance program, which is relying on Vermont survey and Medicaid data. JFO will produce a further report that directly evaluates this cost and benefits analysis after the administration presents it to the legislative committees in November.

Main conclusion: other states have had difficulties achieving predicted enrollment with similar programs.

Several conclusions:

• Complex administrative challenges have constrained enrollment in state premium assistance programs
• Only a handful of premium assistance programs have achieved enrollment levels above one percent of the eligible populations
• Enrollment of low-income adults in premium assistance programs is especially challenging
• Initial enrollment estimates have been overly optimistic, both in the number who ultimately enroll and the time it takes to achieve ultimate enrollment
• Federal efforts to promote state premium assistance programs under the recent HIFA waiver initiative (2001) have yet to bear fruit.

What will not be in the JFO Report: information on cost savings: there are not yet good data and analyses.

6. ESI Premium Assistance design [CD 2, tr. 2]

Betsy Forrest, OVHA

Joshua Slen, Director, OVHA

Document distributed: November ESI Report Timeline, revised. OVHA

Betsy Forest thanked Don Dickey and Steve Kappel for their work—it has been very helpful.

These are very complex programs to design and implement. OVHA is learning from other states, especially Rhode Island and Massachusetts.

OVHA is well under way in designing the program. They plan to have the design done by the end of October, and will issue a contract in November for system design, for a January start date.

The VHAP survey—they have received 868 responses, which is good. The contractor has done the data set. The contractor is Sherry [ Gleid ], of Columbia. She is working with both OVHA and Kenneth Thorpe.

The timeline has been updated from two weeks ago.

Q: The timeline looks very squeezed—it looks tight for both OVHA and for HCRC. Also, Nov. 21 is close to Thanksgiving; and if report isn’t ready by Nov. 27, a large group of legislators (HCRC, HAOC, Joint Fiscal Committee) will have to change schedules.

Q: Re benefits as taxable income—there were concerns about this.

A: It is not. OVHA has researched—various opinions, other states, etc.—and is comfortable with this opinion.

Q: Getting data from insurance companies and from BISHCA?

A: They are in very preliminary discussions. Further discussions are not scheduled yet.

Q: What are they learning from other states, especially re expected enrollments?

A: VHAP survey data will help with this.

7a. General Implementation Update [CD 2, tr. 3]

Christine Oliver, Deputy Commissioner, Health Care Administration, BISHCA

Christine Oliver gave a brief update on the SorryWorks! Program. There is some renewed interest, including from the Southwest Medical Center and from VAHHS.

Re the Cost Shift Task Force and the Consumer Price and Quality Group: they are starting meetings. Commissioners please let her know if they are interested.

7b. Catamount Health letters of intent

BISHCA

The Non-Group Market Survey Trust: Vermont has received a one million dollar grant from CMS, and possible funding for implementation later.

7c. Robert Wood Johnson Foundation's State Coverage Initiatives (SCI)—

Non-group market study report

BISHCA

The Non-Group Market Study: BISHCA is holding meetings with carriers. The Robert Wood Johnson Foundation has funding for consultants on state coverage initiatives.

7d. General Implementation Update [CD 2, tr. 4]

Susan Besio, Director of Health Care Reform Implementation

Document distributed: Vermont Health Care Reform Activities. Sorted by Date & Topic—Oct. 19, 2006.

Vt. Agency of Administration

Susan Besio offered a quick comment about modifying the ESI timeline—it does need to be before the Christmas holidays. And the legislators would need to revise both schedules: the HCRC and the Joint Fiscal Committee.

She also noted website updates.

She has hired an administrative assistant, Rhonda Goodrich. This has been a big help.

She is still trying to get a Health Care Reform Implementation website live. They are working on it, and she is sorry that it is not done yet.

7e. CMS Waiver--submitted

Susan Besio, Director of Health Care Reform Implementation

The CMS waiver has been submitted.

7f. VITL GE Contract

Susan Besio, Director of Health Care Reform Implementation

The VITL/ GE/ Orion contracts are now all signed, as of last Friday.

8. Study Update [CD 2, tr. 5]

Steve Kappel, JFO

Steve Kappel noted that the Administration is not involved in the study.

Q: Why not? A: Steve referred this Q to the Administration.

Re Study:

1. They are getting basic data nailed down. Tom Kavet is working on this.
2. They are building the economic model; are reviewing software.
3. They are on schedule for a January report.

Q: Will the Administration review the assumptions they are building into the model?

A: Steve Kappel: he believes so.

9. IT Update [CD 2, tr. 6]

Hans Kastensmith, Consultant to the Commission

The IT contracts are signed! Orion –GE Healthcare—VITL—Blueprint.

High-level meetings have started. We are five months behind, because of the extended contract negotiations. CCIS projected deployment—planned for next June.

They are drawing communities into the planning process. Mount Ascutney Hospital community is the first. They have a joint press release planned for next week. The kick-off meeting will probably be at the end of October.

One concern re the Blueprint: Money for the risk-stratification model. They have concerns re catching people in the early risk stages. He believes the Legislature will need to address this next session—will need some funding to deal with this. Right now, the Blueprint is more set up to deal with low-hanging fruit. Hans has discussed this with the Blueprint people—their plates are pretty full right now. To deal with this: could get a budget from the Blueprint and the IT contractors, and propose a line item in the Budget for next year.

Q: It will be important to watch carefully to see that the Blueprint is aligned with the Health Care Affordability Act.

There was general discussion on the importance of keeping all groups informed, communicating, sharing information.

Kastensmith noted, re the IT planning, “I’m amazed that you’ve got so far. It is a testimony to all the parties’ openness and sharing. You will need to keep doing so. Without Susan in her position we would have had a lot harder time with this.”

Q re the pilot project in Ascutney area: how does Dartmouth-Hitchcock Medical Center get tied in?

A: Hans K needs to check—his assumption is yes.

Q re a letter on the contract process sent by MBA Resources.

A: Tom Murray, Commissioner of the Dept. of Information and Innovation, has responded on behalf of the Administration. Besio: the letter went out today, and was copied to all the HCRC commissioners. There were some misperceptions: various other products can be supported and used by providers.

10. Public Testimony [CD 3, tr. 1]

Dr. Deborah Richter testified, as an individual, and also on behalf of Con Hogan.

Document distributed: To: The Vermont Commission on Health Care Reform. From Deborah Richter, MD; Cornelius Hogan. Wednesday, Oct. 18, 2006

Richter and Hogan are pleased to see that the ‘single payer’ study prepared by Dr. Kenneth Thorpe proves yet again that it is possible to achieve universal coverage for less than current projected total spending.

They do have several concerns about the study. Overall, they believe that avoided costs have been understated. Their major concerns are in the following areas:

• Administrative cost assumptions and calculations
• The underinsured assumptions and calculations
• Financing concerns
• One-year versus ten-year projections

Richter and Hogan encourage the Commission to consider other, more fair and sustainable publicly-financed options that more closely conform to Vermont’s business configuration and to its available tax base.

Discussion:

1. The Commission has sent Richer and Hogan’s testimony to Dr. Thorpe and has asked for a response.
2. Rep. McFaun wants to publicly recognize the hard work and thoughtful analyses provided by Dr. Richter and Con Hogan over this past year.
3. Commissioners noted that in his oral presentation of his Single-Payer Study, Dr. Thorpe did address several of Richter and Hogan’s concerns.

10. Commission Update and Staffing Discussion [CD 2, tr. 2]

Catherine Benham, Staff Director

Documents distributed:

• Health Care Reform Commission Budget. VT JFO, C. Benham
• Memo to members of the Commission on Health Care Reform, re staffing for the Commission. From Co-Chairs Jim Leddy and John Tracy, Oct. 12, 2006

Catherine Benham presented the HCRC budget. Overall, HCRC net reserves, after the most recent appropriation, are $222,689.

Staffing discussion:

Sen. Leddy: Given the scope of the work under way and to be done (he noted the complexity of the implementation tasks laid out in Susan Besio’s charts), the HCRC needs to revisit how it should be staffed.

Sen. Leddy reviewed the key points in his and Rep. Tracy’s memo:

• Executive and Legislature have distinct roles; the polarization of a year ago does not exist as such now; oversight of the legislation must be joint and collaborative.
• The charge of the Commission will continue.
• Catherine’s role has been limited to staff director, not to include full policy and vision input. As the Commission moves to a broader policy and implementation role, this input will be essential.
• While Dr. Thorpe can continue as a consultant, he cannot monitor to day-today detail of the complex implementation process.
• Continuity will be important. A director can provide continuity and stability.
• A director will be the best option to provide collaboration and cooperation with the Administration.
• Joint Fiscal and Leg. Council staff will return to their tradition roles of drafting bills, fiscal analysis and staffing committees of jurisdiction, once the session starts.
• We have invested too much and come too far to falter now.
• The two co-chairs therefore conclude and recommend that the magnitude and complexity of the work of the Commission require the focused and full-time attention of a highly-skilled health policy professional.

Key points from the extended discussion:

Health care reform impacts a number of legislative committees.

The HCRC needs a legislative version of Susan Besio’s role.

The memo from co-chairs Leddy and Tracy recommends reopening recruiting of a director for the Commission on Health Care Reform. We are in a very different situation from a year ago. Legislation has passed, implementation is happening, the Commission’s role has been revised, funding has changed.

What about staff support for a director? Yes, they would need a staff assistant as well.

What is the role of the Commission? What will a director do? What will the Commission offer after the 2007 session starts?

There was considerable discussion of the pros and cons of having the Commission continue.

Monitor the implementation of Catamount Health and the overall Health Care Affordability Act.

This Commission versus the more traditional structure of standing committees: it is setting a disturbing precedent, and possibly overriding the proper work of standing committees.

Perhaps a Joint Committee structure would be more appropriate.

There were concerns re usurping the legislative process.

It might be more appropriate to use these substantial funds to support the work of the Legislative Council and Joint Fiscal Office in supporting current standing committees.

The Commission was created in the FY 2006 Omnibus Appropriations Act to continue through June of 2009, and a position of director was established to support its work. This included responsibility for studies, research, analysis and education on healthcare issues facing the legislature. Other members returned to the most recent enabling legislation, in Acts 190 and 191 and in the Budget: legislators voted to establish and fund this Commission, and expanded its role this past spring.

Overall, what do we need to do to make this new health care legislation work? The scope is so broad, and we must make this succeed. So the Commission and its oversight role are necessary.

Look at what is being asked of the legislators and the Administration in this area.

If you want the Commission and its work to be successful, you need to get a director hired and on board as soon as possible. We need continuity, especially since both current co-chairs of the Commission are leaving.

Standing committees, including Senate Finance and other, will be overwhelmed with other issues, certainly including property tax. So we will need commission staff to support health care issues in the committees of jurisdiction.

Discussion moved to the job description for a director. Since we now have a bill passed, it needs to be revised.

Catherine and Steve Klein have done preliminary work on this.

Susan Besio offered some comments:

She and the Administration support hiring a director. They do have some caveats:

1. The director needs to be a collaborator, and a unifier. They need to understand the process so far. We want to continue the good collaborative relationship with the Joint Fiscal and Leg. Council staff.
2. The director should not be an implementer. That is the Administration’s job. The legislative job is to set policy; the Administration has worked this past several months to involve legislators in working groups.
3. Third, the director should be objective re health care reform—not bring an agenda. This has been a great benefit of working with the Legislative Council and Joint Fiscal Office: they are non-partisan, and they can understand and present the full picture.

Also, it would be nice to have one point person to deal with—sending out information and materials.

Finally, please be aware of the considerable challenges for those from the Administration in dealing with all the committees and staff during the Session—especially demands for getting information first, and conflicting committee scheduling.

Sen. Leddy thanked Susan Besio—these concerns are significant, and her points are well taken.

Rep. Maier suggested that the co-chairs review and revise a job description and get it out to Commission members right away.

Rep. Ancel: The Commission’s role does go beyond policy—it includes monitoring the implementation as well.

Sen. Kitchel: It will also provide guidance in legislative intent, as the implementation goes forward and questions arise.

Commissioners discussed the best way to screen applications, with a first screening carried out by Bill Russell and Steve Klein, but Commissioners able to see all applications and recommend adding any back in that were screened out, if they so choose.

Motion from Rep. Maier:

Finalize the job description; initiate the recruitment process (noting the process described earlier); screening and interviews to happen as soon as possible (November into early December if necessary); with a new director to be hired as a result of that process.

The motion passed unanimously.

11. SCHEDULING AND NEXT MEETINGS

There was extended discussion of setting next meetings, revising the meeting schedule, accommodating the timeline of the ESI process, working around Thanksgiving and winter holidays, and coordinating the work of this Commission, the Health Access Oversight Commission, and the Joint Fiscal Committee; in the context of Commissioners’ busy schedules and upcoming national legislative conferences. Conclusion: Catherine Benham and Steve Klein will review Commissioners’ schedules, and will poll the members of the Joint Fiscal Committee. They will consult with Commissioners, work on a revised schedule, and inform Commissioners of the new schedule. For now, hold the planned Nov. 21 and Dec. 20 Commission meeting dates, and possibly add other meeting dates.

The meeting adjourned at 2:25 PM.

Minutes respectfully submitted by Loring Starr