Sections on Health Care Reform Commission

No. 71 of the  Acts of the 2005 Legislative Session (H. 516)




(a)  There is established a commission on health care reform.  The commission, under the direction of co-chairs who shall be appointed by the speaker of the house and president pro tempore of the senate, shall monitor health care reform and recommend to the general assembly actions needed to attain the health care guidelines and goals set out in H.524 as passed by the house and senate.

(b)  Members of the commission shall include four representatives appointed by the speaker of the house, four senators appointed by the committee on committees, and two nonvoting members appointed by the governor. 

(c)  Beginning in the interim of the 2005 legislative session through July 1, 2009, the commission shall:

(1)  identify and report emerging trends and behaviors among various participants in the health care system;

(2)  assess the effectiveness of cost-containment and quality of care initiatives;

(3)  establish recommendations to the general assembly for demonstration or pilot projects designed to contain health care costs, improve the quality of health care, and to integrate systems of care that promote:  community-based evaluation and planning, improved financial management, information technology systems that advance the management and coordination of health care, governance models at the community level, and patient responsibility for and participation in health care decision making;

(4)  direct the studies established under Sec. 277d of this act;

(5)  develop a plan for creating an integrated, regional delivery system and developing integrated systems of care that:  (1) reorganize the health care delivery system to improve coordination, reduce medical errors, and reduce redundant or unnecessary care, (2) improve the quality of care in terms of process and outcomes, and (3) encourage alternative reimbursement mechanisms based on outcome-based payments to change the incentives for health care professionals and to control health care costs;

(6) make recommendations to the general assembly for a program to provide matching grants for long-term investments in health care systems, technology, and infrastructure in a manner that promotes the establishment of integrated systems of care;

(7)  assess the feasibility of:

(A)  a publicly financed stop-loss insurance policy for all health plans doing business in Vermont;

(B)  a public health care program that incorporates the health benefits covered under workers’ compensation policies;

(C)  tort reform consistent with the findings and recommendations of the medical malpractice study authorized under Sec. 292 of No. 122 of the Acts of the 2003 Adj. Sess (2004); and

(D)  a health care purchasing pool as described in Sec. 26 of H.524 as passed by the house and senate;

(8)  recommend alternative reimbursement mechanisms for health services that encourage cost effectiveness, improve the quality of care,  increase efficiency, reward primary care practices that prevent chronic illnesses, avoid preventable hospitalizations, and reduce long-term costs to the system, including a global hospital payment to each hospital. For the purposes of this section, “global hospital payment” means an amount to be paid to a hospital by each health insurer, employer or the state for services received at that hospital by all individuals covered by a health benefit plan offered by or through that insurer, employer or the state. A global hospital payment may be accomplished through negotiations between insurers or employers and hospitals, by requiring all public and private health insurers to pay for hospital services using this method to the extent permitted under federal law, or by another mechanism;

(9)  receive input and make recommendations, generally, to the house committees on health care and ways and means, the senate committees on health and welfare and finance and the general assembly regarding the long‑term development of policies and programs designed to ensure that, by 2009, Vermont has an integrated system of care that provides all Vermonters access to affordable, high quality health care that is financed in a fair and equitable manner; and

(10)  cooperate and coordinate with the public engagement process established in Sec. 277e of this act to receive public input on a health care reform plan.

(d)  The commission shall select, subject to final approval by the speaker of the house and the president pro tempore of the senate, the services of one full‑time director and such other staff as is needed, and shall receive administrative, fiscal, and legal support from the joint fiscal office and the legislative council.  The director shall have expertise in finance, planning, systems analysis, and processes involving weighing competing interests among parties.  In addition, with the approval of the speaker of the house and the president pro tempore of the senate, the commission may retain the services of one or more consultants or experts knowledgeable in health care systems, financing, or delivery to assist in its work and may request funding from the legislative budget.

(e)  The commission may request analysis from the office of Vermont health access, the department of banking, insurance, securities, and health care administration, and other appropriate agencies.  The agencies shall report to the commission at such times and with such information as the commission determines is necessary to fulfill its oversight responsibilities.

(f)  The commission may meet as needed and members shall be entitled to compensation and expenses as provided in 2 V.S.A. § 406.

(g)  The department of buildings and general services shall provide the commission with office space near the state capitol building in Montpelier for three individuals.

     (h)  To staff this commission, the legislature is authorized to establish three (3) new exempt positions – one (1) commission director and two (2) commission research/support staff in fiscal year 2005.



(a)  In order to assess more fully the benefits and costs and to prepare and plan for the implementation of full and universal access to health care in Vermont, the commission on health care reform, in consultation with the department of banking, insurance, securities, and health care administration, shall direct that the following economic impact, financing, and governance studies be undertaken during the interim of the 2005 legislative session.  The commission shall direct its staff or contract for one or more consultants to undertake the economic impact and financing studies authorized by this section.

(1)  Economic impact study.  The economic impact study shall examine the impact of implementing a system of universal access to health care for Vermonters versus the effects of sustaining the current system impact on business and the labor force, the future growth of the economy and the economic competitiveness of Vermont, and the effects on residents and population groups and on current and potential insurers and providers of health care.

(2)  Financing options.  The financing study shall examine the financing options that most effectively achieve the goal of universal access to health care and maintaining its affordability.  The study shall include examination of all financing options and their implications, including the income tax, a payroll tax, premiums or cost-sharing measures, consumption taxes, specific more limited taxes to support parts of the health care system’s financial needs, and other revenue sources including insurance risk pools and insurance assistance and incentives.

(A)  The study shall reference the fact and supporting empirical evidence that many countries have achieved universal access and more affordable health care utilizing public financing as a tool to achieve this goal. The study shall consider the strengths and weaknesses of such public financing systems with respect to fairness and adequacy of funding, access to and quality of services.

(B)  The study shall examine how implementation of any public financing options will be offset in corresponding reductions in premiums, other taxes, and individual cost-sharing contributions.

(C)  The study shall examine how any proposed changes in financing or delivery of health care could affect benefits Vermonters currently receive through Vermont employers.

(D)  The study shall address issues involved with federal law and taxation, including ERISA and other areas of preemption; technical proposals to exempt non-resident employees of Vermont businesses; a provision to ensure a soft landing for affected businesses and a recommendation as to the appropriate amount needed in a soft landing provision to mitigate negative effects on business; recommendations on the best method for unemployed individuals to contribute to the financing; a simplified structure based on employee numbers, employer payroll, or a combination for ease of administration and clarity; and the recommendations of the tax department. 

(E)  The study shall analyze methods for recapturing insurance premiums as a result of any reductions in uncompensated care, such as the Dirigo model enacted in the state of Maine, any reductions in insurance premiums resulting from public financing, and for ensuring that all Vermonters contribute to the financing of health care’s fixed costs.

(3)  Governance and administrative study.  The secretary of administration, in consultation with the office of Vermont health access, the department of banking, insurance, securities, and health care administration, and the agency of human services, shall examine and develop a plan for reorganizing their respective offices and functions to further full and universal access to health care in Vermont and the integration of the health care system. The recommendations shall include personnel, operations, and budgetary requirements and consider the most appropriate and efficient approach to integrating health care policy, planning, delivery, regulation, and defining clear lines of accountability within the health care system.  The study shall include also an examination of means to coordinate or integrate a universal health care system with the current workers’ compensation system and the feasibility and merits of authorizing the state to act as an insurer in pooling risk and providing benefits, including a common benefits plan, to participants of the health care purchasing pool.

(b)  Reports, including findings and recommendations, from each study required by this section shall be submitted to the general assembly not later than January 15, 2006.


(a)  In recognition of the importance of public engagement, the house committee on health care and the senate committee on health and welfare shall have six public hearings during the interim of the 2005 legislative session to solicit input from citizens, employers, hospitals, health care professionals, insurers, other stakeholders, and interested parties about health care reform.

(b)  Throughout the interim, the commission on health care reform at the request of the chairs of the committees shall brief the committees on the commission’s activities and recommendations to date.

(c)  For attendance at meetings, committee members shall be entitled to compensation and expenses as provided in 2 V.S.A. § 406.