TO THE HOUSE OF REPRESENTATIVES

      The Committee on Health , to which was referred Senate Bill S.310, entitled "AN ACT RELATING TO COMMON SENSE INITIATIVES IN HEALTH CARE "

respectfully report that they have met and considered the same and recommend that the House propose to the Senate that the bill be amended by striking all after the enacting clause and inserting in lieu thereof the following:

* * * WELLNESS INITIATIVES * * *

* * * Healthy Lifestyle Insurance Discount * * *

Sec. 1.  8 V.S.A. § 4080a(h) is amended to read:

(h)(1)  A registered small group carrier shall use a community rating method acceptable to the commissioner for determining premiums for small group plans.  Except as provided in subdivision (2) of this subsection, the following risk classification factors are prohibited from use in rating small groups, employees, or members of such groups, and dependents of such employees or members:

(A)  demographic rating, including age and gender rating;

(B)  geographic area rating;

(C)  industry rating;

(D)  medical underwriting and screening;

(E)  experience rating;

(F)  tier rating; or

(G)  durational rating.

(2)(A)  The commissioner shall, by rule, adopt standards and a process for permitting registered small group carriers to use one or more risk classifications in their community rating method, provided that the premium charged shall not deviate above or below the community rate filed by the carrier by more than 20 percent (20%), and provided further that the commissioner’s rules may not permit any medical underwriting and screening.

(B)  The commissioner’s regulations shall permit a carrier, including a hospital or medical service corporation and a health maintenance organization, to establish rewards, premium discounts, rebates, or otherwise waive or modify applicable co-payments, deductibles, or other cost-sharing amounts in return for adherence by a member or subscriber to programs of health promotion and disease prevention.  The commissioner shall consult with the commissioner of health and the director of the office of Vermont health access in the development of health promotion and disease prevention regulations.  Such regulations shall:

(i)  limit any reward, discount, rebate, or waiver or modification of cost-sharing amounts to not more than 15 percent of the cost of the premium for the applicable coverage tier;

(ii)  be designed to promote good health or prevent disease for individuals in the program and not be used as a subterfuge for imposing higher costs on an individual based on a health factor;

(iii)  provide that the reward under the program is available to all similarly situated individuals; and

(iv)  provide a reasonable alternative standard to obtain the reward to any individual for whom it is unreasonably difficult due to a medical condition or other reasonable mitigating circumstance to satisfy the otherwise applicable standard for the discount and disclose in all plan materials that describe the discount program the availability of a reasonable alternative standard.

(C)  The commissioner’s regulations shall include:

(i)  standards and procedures for health promotion and disease prevention programs based on the best scientific, evidence-based medical practices as recommended by the commissioner of health;

(ii)  standards and procedures for evaluating an individual’s adherence to programs of health promotion and disease prevention; and

(iii)  any other standards and procedures necessary or desirable to carry out the purposes of this subdivision (2).

(3)  The commissioner may exempt from the requirements of this section an association as defined in section subdivision 4079(2) of this title which:

(A)  offers a small group plan to a member small employer which is community rated in accordance with the provisions of subdivisions (1) and (2) of this subsection.  The plan may include risk classifications in accordance with subdivision (2) of this subsection;

(B)  offers a small group plan that guarantees acceptance of all persons within the association and their dependents; and

(C)  offers one or more of the common health care plans approved by the commissioner under subsection (e) of this section.

(4)  The commissioner may revoke or deny the exemption set forth in subdivision (3) of this subsection if the commissioner determines that:

(A)  because of the nature, size, or other characteristics of the association and its members, the employees, or members are in need of the protections provided by this section; or

(B)  the association exemption has or would have a substantial adverse effect on the small group market.

Sec. 2.  8 V.S.A. § 4080b(h) is amended to read:

(h)(1)  A registered nongroup carrier shall use a community rating method acceptable to the commissioner for determining premiums for nongroup plans.  Except as provided in subdivision (2) of this subsection, the following risk classification factors are prohibited from use in rating individuals and their dependents:

(A)  demographic rating, including age and gender rating;

(B)  geographic area rating;

(C)  industry rating;

(D)  medical underwriting and screening;

(E)  experience rating;

(F)  tier rating; or

(G)  durational rating.

(2)(A)  The commissioner shall, by rule, adopt standards and a process for permitting registered nongroup carriers to use one or more risk classifications in their community rating method.  After July 1, 1993, provided that the premium charged shall not deviate above or below the community rate filed by the carrier by more than 40 percent (40%) for two years, and thereafter 20 percent (20%).  Such rules may not permit, and provided further that the commissioner’s regulations may not permit any medical underwriting and screening and shall give due consideration to the need for affordability and accessibility of health insurance.

(B)  The commissioner’s regulations shall permit a carrier, including a hospital or medical service corporation and a health maintenance organization, to establish rewards, premium discounts, rebates, or otherwise waive or modify applicable co-payments, deductibles, or other cost-sharing amounts in return for adherence by a member or subscriber to programs of health promotion and disease prevention.  The commissioner shall consult with the commissioner of health and the director of the office of Vermont health access in the development of health promotion and disease prevention regulations.  Such regulations shall:

(i)  limit any reward, discount, rebate, or waiver or modification of cost-sharing amounts to not more than 15 percent of the cost of the premium for the applicable coverage tier;

(ii)  be designed to promote good health or prevent disease for individuals in the program and not be used as a subterfuge for imposing higher costs on an individual based on a health factor;

(iii)  provide that the reward under the program is available to all similarly situated individuals; and

(iv)  provide a reasonable alternative standard to obtain the reward to any individual for whom it is unreasonably difficult due to a medical condition or other reasonable mitigating circumstance to satisfy the otherwise applicable standard for the discount and disclose in all plan materials that describe the discount program the availability of a reasonable alternative standard.

(C)  The commissioner’s regulations shall include:

(i)  standards and procedures for health promotion and disease prevention programs based on the best scientific, evidence-based medical practices as recommended by the commissioner of health;

(ii)  standards and procedures for evaluating an individual’s adherence to programs of health promotion and disease prevention; and

(iii)  any other standards and procedures necessary or desirable to carry out the purposes of this subdivision (2).

Sec. 3.  8 V.S.A. § 4516 is amended to read:

§ 4516.  ANNUAL REPORT TO COMMISSIONER

Annually, on or before March 15, a hospital service corporation shall file with the commissioner of banking, insurance, securities, and health care administration a statement sworn to by the president and treasurer of the corporation showing its condition on December 31.  The statement shall be in such form and contain such matters as the commissioner shall prescribe.  To qualify for the tax exemption set forth in section 4518 of this title, the statement shall include a certification that the hospital service corporation operates on a nonprofit basis for the purpose of providing an adequate hospital service plan to individuals of the state, both groups and nongroups, without discrimination based on age, gender, geographic area, industry, and medical history, except as allowed by subdivisions 4080a(h)(2)(B) and 4080b(h)(2)(B) of this title.

Sec. 4.  8 V.S.A. § 4588 is amended to read:

§ 4588.  ANNUAL REPORT TO COMMISSIONER

Annually, on or before March 15, a medical service corporation shall file with the commissioner of banking, insurance, securities, and health care administration a statement sworn to by the president and treasurer of the corporation showing its condition on December 31, which shall be in such form and contain such matters as the commissioner shall prescribe.  To qualify for the tax exemption set forth in section 4590 of this title, the statement shall include a certification that the medical service corporation operates on a nonprofit basis for the purpose of providing an adequate medical service plan to individuals of the state, both groups and nongroups, without discrimination based on age, gender, geographic area, industry, and medical history, except as allowed by subdivisions 4080a(h)(2)(B) and 4080b(h)(2)(B) of this title.

Sec. 5.  8 V.S.A. § 5115 is amended to read:

§ 5115.  DUTY OF NONPROFIT HEALTH MAINTENANCE

              ORGANIZATIONS 

Any nonprofit health maintenance organization subject to this chapter shall offer nongroup plans to individuals in accordance with section 4080b of this title without discrimination based on age, gender, industry, and medical history, except as allowed by subdivisions 4080a(h)(2)(B) and 4080b(h)(2)(B) of this title.

* * * Community Grants * * *

Sec. 6.  CoORDINATED Healthy Activity, Motivation,

             and Prevention Programs

(a)  The department of health initiative known as “champps,” coalition for healthy activity, motivation, and prevention programs, shall serve as the foundation for the community wellness initiatives within the department.

(b)  The secretary of human services shall compile an inventory of existing state programs or initiatives, including those administered by other agencies, that fund or promote health, recreation, wellness, or like efforts, along with the amount of funds allotted to the program or initiative, the source of the funds, and the period for which the funds will be available.  The secretary shall file the inventory with the senate committee on health and welfare and the house committees on human services and on health care no later than December 15, 2006. 

(c) It is the intent of the legislature that the base funding for the department of health programs on healthy aging and fit and healthy kids,  the base funding for community grants as part of the blueprint for health program, $500,000.00 of the grant funds received by the department of health from the U.S. Department of Health and Human Services, Substance Abuse and Mental Health Services Administration and potentially other programs as identified from the inventory to be prepared pursuant to subsection (b) above, be incorporated into the community health and wellness grant fund program in fiscal year 2008, through the budget process.

Sec. 7.  18 V.S.A. § 104b is added to read:

§ 104b.  COMMUNITY HEALTH AND WELLNESS GRANTS

(a)  The commissioner shall establish a program for awarding competitive, substantial, multi-year grants to comprehensive community health and wellness projects.  Successful projects must:

(1)  use comprehensive approaches designed to promote healthy behavior and disease prevention across the community and across the lifespan of individual Vermonters and address issues which may include promoting nutrition and exercise for children, community recreation programs, elderly wellness, lead poisoning abatement, obesity prevention, maternal and child health and immunization, mental health and substance abuse, and tobacco prevention and cessation. 

(2)  be consistent with the blueprint for health and other state health initiatives as well as the overall goals of the applicant community;

(3)  be goal and outcome driven;

(4)  use strategies that have been demonstrated to be effective in reaching the desired outcome; and

(5)  provide data for evaluating and monitoring progress.

(b)  The commissioner shall assist community projects by:

(1)  providing technical assistance;

(2)  providing access to best and promising practices and approved public policies,

(3)  helping projects obtain and maximize funding from all applicable sources;

(4)  providing other assistance as appropriate. 

(c)(1)  No later than September 1, 2006, the commissioner shall establish a grant committee, which the commissioner or deputy commissioner shall chair, that shall consist of:

(A)  the commissioner of education or designee; the commissioner for children and families or designee; the secretary of agriculture, food and markets or designee; the commissioner of disabilities, aging, and independent living or designee; and the director of health access or designee;

(B)  a representative from the Vermont school boards association;

(C)  a representative from the Vermont league of cities and towns;

(D)  two members of the senate appointed by the committee on committees and two members of the house appointed by the speaker of the house;

(E)  the administrator of the Vermont tobacco evaluation and review board or designee; and

(F)  a member of the governor’s commission on healthy aging; and

(G) six individuals appointed by the governor representing local communities, collaboratives, or coalitions.

(2)  For attendance at meetings which are held when the general assembly is not in session, the legislative members of the committee shall be entitled to the same per diem compensation and reimbursement for necessary expenses as those provided to members of standing committees under 2 V.S.A. § 406.

(d)  The grant committee shall, consistent with this section:

(1)  design comprehensive project parameters, including criteria for evaluating the success of community projects;

(2)  create an integrated funding framework;

(3)  determine grant application criteria and procedures that are community-friendly, including use of a single, simple grant application and simple reporting requirements;

(4)  develop criteria for preparation grants designed to enable a community to obtain initial funds for the purpose of preparing the community for application for a full grant;

(5)  encourage and facilitate private participation in community projects; and

(6)  write requests for proposals to request grant applications;

(7)  review and score grant applications and recommend to the commissioner which grants to fund and in what amount for grant funding to begin no later than July 1, 2007, all of which shall be done without participation from the legislative members of the committee;

(e)  By January 15 of each year, the commissioner shall report on the status of the program to the general assembly, the senate committee on health and welfare, and the house committees on human services and on health care.

(f)  The commissioner may adopt regulations pursuant to chapter 25 of Title 3, the administrative procedure act, necessary for the implementation of this program.   

(g)  The commissioner is authorized to accept donations or contributions from private sources for community wellness grants. 

* * * Medical Event Reporting * * *

Sec. 8.  18 V.S.A. § 1905(19) is added to read:

(19)  All hospitals shall comply with the regulations adopted by the commissioner pursuant to section 1912 of this title.  License applications shall certify compliance with the regulations.

Sec. 9.  18 V.S.A. § 1912 is added to read:
§ 1912.  PATIENT SAFETY SURVEILLANCE
AND IMPROVEMENT

    SYSTEM

(a)  As used in this section:

(1)  “Adverse event” is any untoward incident, therapeutic misadventure, iatrogenic injury, or other undesirable occurrence directly associated with care or services provided by a health care provider or health care facility.

(2)  “Causal analysis” means a formal root cause analysis, similar analytic methodologies or any similarly effective but simplified processes that use a systematic approach to identify the basic or causal factors that underlie the occurrence or possible occurrence of a reportable adverse event, adverse event, or near miss. 

(3)  “Commissioner” means the commissioner of health. 

(4)  “Corrective action plan” means a plan to implement strategies intended to eliminate or significantly reduce the risk of a recurrence of an adverse event and to measure the effectiveness of such strategies.

(5)  “Department” means the department of health.

(6)  “Hospital” shall have the same meaning as in subdivision 1902(1) of this title.

(7)  “Health care provider” shall have the same meaning as in subdivision 9402(8) of this title.

(8) "Intentional unsafe act" shall mean an adverse event or near miss that results from:

(A)  a criminal act;

(B)  a purposefully unsafe act;

(C)  alcohol or substance abuse; or

(D)  patient abuse. 

(9)“Near miss” means any process variation that did not affect the outcome, but for which a recurrence carries a significant chance of a serious adverse outcome.  

(10)  “Reportable adverse event” means those adverse events a hospital is required to report to the department pursuant to regulations adopted under subsection (c) of this section.  

(11)  “Safety system” means the comprehensive patient safety surveillance and improvement system established pursuant to this section and the regulations adopted hereunder.

(12)  “Serious bodily injury” means bodily injury that creates a substantial risk of death or that causes substantial loss or impairment of the function of any bodily member or organ or substantial impairment of health or substantial disfigurement.

(b)  The commissioner shall establish a comprehensive patient safety surveillance and improvement system for the purpose of improving patient safety, eliminating adverse events in Vermont hospitals, and supporting and facilitating quality improvement efforts by hospitals.  The department may contract with a qualified organization having expertise in patient safety to develop and implement all or part of the safety system.

(c)  The commissioner shall promulgate regulations pursuant to chapter 25 of Title 3 necessary for the implementation of this program.  The regulations shall list reportable adverse events, which shall include the “serious reportable events” published by the National Quality Forum.  The commissioner shall consult with experts and hospitals when making changes to the list of reportable adverse events and shall consider the implications of reporting requirements that may be established as a result of the federal Patient Safety and Quality Improvement Act of 2005.  The department shall consult with other regulatory agencies and departments and, to the extent possible, avoid imposing duplicative reporting requirements.   

(d)  The department shall:

(1)  collect data concerning the occurrence of reportable adverse events; 

(2)  aggregate and analyze data for the purpose of developing and implementing strategies to target and eliminate specific adverse events;

(3)  verify that hospitals are in compliance with all the requirements of this section and regulations adopted hereunder;

(4)  for reportable adverse events, verify that hospitals are conducting causal analyses and developing corrective action plans consistent with standards set by the department, current patient safety science, and relevant clinical standards;

(5)  provide technical assistance or assist hospitals in locating technical assistance resources for analyzing adverse events and near misses and developing and implementing corrective action plans; and

(6) encourage hospitals to utilize anonymous in-hospital reporting when possible.

(e)  The regulations adopted hereunder shall require hospitals to:

(1)  develop, maintain, and implement internal policies and procedures that meet the standards of the department to:

(A)  identify, track, and analyze reportable adverse events, adverse events, and near misses;

(B)  determine what type of causal analysis, if any, is appropriate;

(C)  conduct causal analyses and develop corrective action plans; and

(D)  disclose to patients, or, in the case of a patient death, an adult member of the immediate family, at a minimum, adverse events that cause death or serious bodily injury.      

(2)  report reportable adverse events to the department.

(3)  provide the department with copies of its causal analysis and corrective action plan in connection with each reportable adverse event.

(4)  for reportable adverse events that must also by law be reported to other departments or agencies, notify the department of health or provide a copy of any written report and provide any causal analysis information required by the department.  Such reports shall not constitute a waiver of peer review or any other privilege.     

(5)  for the purpose of evaluating a hospital’s compliance with the provisions of this section, provide the commissioner and designees reasonable access to:

(A)  information protected by the provisions of the patient’s privilege under subsection 1612(a) of Title 12 or otherwise required by law to be held confidential; and

(B)  the minutes and records of a peer review committee and any other information subject to peer review protection under section 1443 of Title 26.  Hospitals may replace health care provider identifying information with a surrogate identifier that allows for tracking of adverse events involving the same provider without disclosing the provider’s identity. 

(f)(1)  A hospital shall notify the department, within the time frames established by regulation, if the information available supports a reasonable, good faith belief that an intentional unsafe act as it pertains to patients has occurred. 

(2)  For intentional unsafe acts reportable to other departments or agencies, notify the department of health or provide a copy of any written report.  Such reports shall not constitute a waiver of peer review or any other privilege.

(3)  If the department confirms or independently concludes, based on a reasonable, good faith belief, that an intentional unsafe act occurred, it shall notify relevant state and federal licensing and other regulatory entities and, in the case of possible criminal activity, relevant state and federal law enforcement authorities.

(4)  There shall be no liability on the part of and no cause of action for damages shall arise against any individual or hospital for any act or proceeding related to activities undertaken or performed within the scope of the obligations imposed by this subsection, provided that the individual or hospital acts without malice and with the reasonable belief that the action is warranted by the facts known after making reasonable efforts to obtain all the facts.

(5)  Nothing in this subsection shall prevent a hospital from conducting its own investigation or peer review.  

(g)(1)  All information made available to the department and its designees under this section shall be confidential and privileged, exempt from the public access to records law, and in any civil or administrative action against a provider of professional health services arising out of the matters which are subject to evaluation and review by the department, immune from subpoena or other disclosure and not subject to discovery or introduction into evidence.  No person with access to information made available to the commissioner or his or her designees under this section shall be permitted or required to testify as to any findings, recommendations, evaluations, opinions, or other actions of the department in any civil or administrative action against a provider of professional health services arising out of the matters which are subject to evaluation and review by the department. Within the department, access to peer review protected information shall be limited to individuals responsible for verifying compliance with the safety system and for providing necessary consultation and supervision to that program.    

(2)  Notwithstanding subdivision (1) of this subsection:

(A)  hospitals and the department staff responsible for verifying compliance with the safety system are authorized to disclose information necessary to comply with their reporting obligations in subsection (f) of this section;

(B)  the department staff responsible for verifying compliance with the patient safety surveillance and improvement system may disclose information to others in the department, and the department may disclose information to the board of health and others responsible for carrying out the department’s enforcement responsibilities with respect to this section if the department reasonably believes that a hospital deliberately or repeatedly has not complied with the requirements of this section and any regulations adopted hereunder.  The commissioner, the board of health, and others responsible for carrying out the department’s enforcement responsibilities with respect to this section are authorized to disclose such information during the course of any legal or regulatory action taken against a hospital for deliberate or repeated noncompliance with the requirements of this section and any regulations adopted hereunder.  Information disclosed under this subdivision shall otherwise maintain all applicable protections under subdivision (1) of this subsection and otherwise provided by law.  

(3)  Nothing in this section shall prohibit a hospital from making a good faith report to regulatory or law enforcement authorities based on information, documents, or records known or available to it from original sources.  Information, documents, or records otherwise available from original sources are not to be construed as immune from discovery or use in any other action merely because they were made available to the department’s patient safety surveillance and improvement system.

(h)  The commissioner shall consult with the commissioner of banking, insurance, securities, and health care administration, and with patient safety experts, hospitals, health care professionals, and members of the public and shall make recommendations to the commissioner of banking, insurance, securities, and health care administration concerning which patient safety data should be included in the hospital community reports required by section 9405b of this title.   The commissioner shall make such recommendations no more than 18 months after data collection is initiated.

(i)  If the commissioner determines that a hospital has failed to comply with any of the provisions of this section, the commissioner may sanction the hospital as provided in this title.  In evaluating compliance, the commissioner shall place primary emphasis on assuring good faith compliance and effective corrective action by the facility, reserving punitive enforcement or disciplinary action for those cases in which the facility has displayed recklessness, gross negligence, or willful misconduct or in which there is evidence, based on other similar cases known to the department, the agency of human services, or the office of the attorney general, of a pattern of significant substandard performance that has the potential for or has actually resulted in harm to patients.

(j)  After notice and an opportunity for hearing, the commissioner may impose on a hospital who knowingly violates a provision of this subchapter or a rule or order adopted pursuant to this subchapter a civil administrative penalty of no more than $10,000.00 or, in the case of a continuing violation, a civil administrative penalty of no more than $100,000.00 or one-tenth of one percent of the gross annual revenues of the health care facility, whichever is greater.  A hospital aggrieved by a decision of the commissioner under this subdivision may appeal the commissioner’s decision pursuant to section 128 of this title.

(k)  The authority granted to the commissioner under this section is in addition to any other authority granted to the commissioner under law.

(1)  The commissioner may retain or contract with such additional professional or other staff as needed to carry out responsibilities under this section.  

(m)  No later than January 15, 2008, the commissioner of health shall provide an interim report to the senate committee on health and welfare and the house committees on human services and on health care on the status of the safety system, its effectiveness in improving patient safety and health care quality in the state, and cost savings.  No later than January 15, 2009, the commissioner shall make a final report to those committees on those subjects and shall make recommendations regarding expansion of the system to include health care facilities other than hospitals.

(n)  Beginning July 1, 2007, expenses incurred for development and implementation of the safety system shall be borne as follows:  50 percent from general fund monies and 50 percent by the hospitals. 

Sec. 10.  26 V.S.A. § 1443(b) and (c) are amended to read: 

(b)  Notwithstanding the provisions of subsection (a) of this section, a peer review committee shall provide a board with all supporting information and evidence pertaining to information required to be reported under section 1317 of this title and shall provide access to such information and evidence to the department of health as provided in and for the purpose of determining a hospital’s compliance with section 1912 of Title 18.

(c)  Notwithstanding the provisions of section 1318 of this title, relating to accessibility and confidentiality of disciplinary matters, the proceedings, reports, records, reporting information, and evidence of a peer review committee provided by the committee to a board in accordance with the provisions of section 1317 of this title or to the department of health in accordance with section 1912 of Title 18 and subsection (b) of this section, may be used by the board or by the commissioner of health or board of health for disciplinary and enforcement purposes but shall not be subject to public disclosure.

Sec. 11.  1 V.S.A. § 317(c) is amended to read:

(c)  The following public records are exempt from public inspection and copying:

* * *

(34)  affidavits of income and assets as provided in section 662 of Title 15 and Rule 4 of the Vermont Rules for Family Proceedings;

* * *

(36)  records provided to the department of health pursuant to the patient safety surveillance and improvement system established by section 1912 of Title 18

* * * Hospital Infection Rate Reporting * * *

Sec. 12.  18 V.S.A. § 9405b(a) is amended to read: 

§ 9405b.  HOSPITAL COMMUNITY REPORTS

(a)  The commissioner, in consultation with representatives from the public oversight commission, hospitals, and other groups of health care professionals, and members of the public representing patient interests, shall adopt rules establishing a standard format for community reports, as well as the contents, which shall include:

(1)  measures of quality, including process and outcome measures, that are valid, reliable, and useful, including comparisons to appropriate national benchmarks for high quality and successful outcomes;

(2)  measures of patient safety that are valid, reliable, and useful, including comparisons to appropriate industry benchmarks for safety;

(3)  measures of hospital-acquired infections that are valid, reliable, and useful, including comparisons to appropriate industry benchmarks;

(3)(4)  measures of the hospital’s financial health, including comparisons to appropriate national benchmarks for efficient operation and fiscal health;

(4)(5)  a summary of the hospital’s budget, including revenue by source and quantification of cost shifting to private payers;

(5)(6)  measures that provide valid, reliable, useful, and efficient information for payers and the public for the comparison of charges for higher volume health care services;

(6)(7)  the hospital’s process for achieving openness, inclusiveness, and meaningful public participation in its strategic planning and decision-making;

(7)(8)  the hospital’s consumer complaint resolution process, including identification of the hospital officer or employee responsible for its implementation;

(8)(9)  information concerning recently completed or ongoing quality improvement and patient safety projects;

(9)(10)  a summary of the community needs assessment, including a description of strategic initiatives discussed with or derived from the assessment; the one-year and four-year capital expenditure plans; and the depreciation schedule for existing facilities; and

(10)(11)  information on membership and governing body qualifications, a listing of the current governing body members, and means of obtaining a schedule of meetings of the hospital’s governing body, including times scheduled for public participation.

* * * Administrative Simplification * * *

Sec. 13.  COMMON CLAIMS AND PROCEDURES

(a)  No later than July 1, 2008, the commissioner shall amend the rules adopted pursuant to section 9408 of Title 18 as may be necessary to implement the recommendations of the final report described in subsection (g) of this section, as the commissioner deems appropriate in his or her discretion.  Nothing in this section shall be construed to alter the commissioner’s authority under Title 8 or chapter 221 of Title 18.

(b)  No later than July 1, 2006, a common claims and procedures work group shall form, composed of:   

(1)  two representatives selected by the Vermont association of hospitals and health systems;

(2)  two representatives selected by the Vermont medical society;

(3)  one representative of each of the three largest health care insurers;

(4)  the director of the office of health access or designee;

(5)  two representatives from business groups appointed by the governor;

(6)  the health care ombudsman or designee;

(7)  one representative of consumers appointed by the governor; and

(8)  the commissioner of the department of banking, insurance, securities and health care administration or designee.

(c)  The group shall design, recommend, and implement steps to achieve the following goals:

(1)  Simplifying the claims administration process for consumers, health care providers, and others so that the process is more understandable and less time-consuming.

(2)  Lowering administrative costs in the health care financing system.

(d)  The group shall elect a chair at its first meeting.  The chair, or the chair's designee, shall be responsible for scheduling meetings and ensuring the completion of the reports called for in subsection (g) of this section.  Each organization represented on the work group shall be asked to contribute funds for the group's administrative costs. 

(e)  On or before September 1, 2006, the work group shall present a two‑year work plan and budget to the house committee on health care and the senate committee on health and welfare. 

(f)  This work plan may include the elements of the claims administration process, including claims forms, patient invoices, and explanation of benefits forms, payment codes, claims submission and processing procedures, including electronic claims processing, issues relating to the prior authorization process and reimbursement for services provided prior to being credentialed.

(g)  The work group shall make an interim report to the governor and the general assembly on or before January 15, 2007 describing the progress of the group and any interim steps taken to achieve the goals of the work plan.  The work group shall make a final report to the governor and the general assembly on or before January 15, 2008 with the findings that illustrate the outcomes of implementations derived from the work group actions along with a list of future actions and goals, which shall specify cost savings achieved and expected future savings. 

Sec. 14.  18 V.S.A. § 9408a is added to read:

§ 9408a.  Uniform Provider Credentialing

(a)  Definitions.  As used in this section:

(1)  “Credentialing” means a process through which an insurer or hospital makes a determination, based on criteria established by the insurer or hospital, concerning whether a provider is eligible to:

(A)  provide health care services to an insured or hospital patients; and

(B) receive reimbursement for the health care services.

(2)  “Health care services” means health‑care‑related services or products rendered or sold by a provider within the scope of the provider’s license or legal authorization, including hospital, medical, surgical, dental, vision, and pharmaceutical services or products.

(3)  “Insured” means an individual entitled to reimbursement for

expenses of health care services under a policy issued or administered

by an insurer.

(4)  “Insurer” has the same meaning as in subdivision 9402(9) of this title.

(5)  “Provider” has the same meaning as in subdivision 9402(8) of this title.

(b)  The department shall prescribe the credentialing application form used by the Council for Affordable Quality Healthcare (CAQH), or a similar, nationally recognized form prescribed by the commissioner, in electronic or paper format, which must be used beginning January 1, 2007 by an insurer or a hospital that performs credentialing.

(c)  An insurer or a hospital shall notify a provider concerning a deficiency on a completed credentialing application form submitted by the provider not later than 30 business days after the insurer or hospital receives the completed credentialing application form.

(d)  An insurer or a hospital shall notify a provider concerning the status of the provider’s completed credentialing application not later than:

(1)  Sixty days after the insurer or hospital receives the completed

credentialing application form; and

(2)  Every 30 days after the notice is provided under subdivision (1) of this subsection, until the insurer or hospital makes a final credentialing determination concerning the provider.

(e)  The commissioner may enforce compliance with the provisions of this section as to insurers and as to hospitals as if the hospital were an insurer under section 3661 of Title 8.  

* * * INFORMATION TECHNOLOGY * * *

* * * Coordination of IT Efforts * * *

Sec. 15.  3 V.S.A. § 2222a is added to read:

§ 2222a.  HEALTH CARE SYSTEM REFORM; IMPROVING QUALITY AND AFFORDABILITY

(a)  The secretary of administration, working in collaboration with the general assembly, shall be responsible for the coordination of health care system reform initiatives among executive branch agencies, departments, and offices.

(b)  The secretary shall ensure that those executive branch agencies, departments, and offices responsible for the development, improvement, and implementation of Vermont’s health care system reform do so in a manner that is timely, patient-centered, and seeks to improve the quality and affordability of patient care. 

(c)  Vermont’s health care system reform initiatives include:

(1)  the state’s chronic care infrastructure, disease prevention, and management program contained in the blueprint for health, the goal of which is to achieve a unified, comprehensive, statewide system of care that improves the lives of Vermonters with or at risk for chronic disease.

(2)  the Vermont health information technology project pursuant to section 9417 of Title 18.

(3)  the multi-payer data collection project pursuant to section 9410 of Title 18.

(4)  the common claims administration project pursuant to section 9408 of Title 18.

(5)  the consumer price and quality information system pursuant to section 9410 of Title 18.

(6)  any information technology work done by the quality assurance system pursuant to section 9416 of Title 18.

(7)  the public health promotion programs of the department of health and the department of disabilities, aging, and independent living.

(8)  Medicaid, the Vermont health access plan, Dr. Dynasaur, VPharm, and Vermont Rx, which are established in chapter 19 of Title 33 and provide health care coverage to elderly, disabled, and low to middle income Vermonters.

(d)  The secretary shall report to the commission on health care reform, the health access oversight committee, the house committee on health care, the senate committee on health and welfare, and the governor on or before December 1, 2006 with a five-year strategic plan for implementing Vermont’s health care system reform initiatives, together with any recommendations for administration or legislation.  Annually, beginning January 15, 2007, the secretary shall report to the general assembly on the progress of the reform initiatives.

(e)  The secretary of administration or designee shall provide information and testimony on the activities included in this section to the health access oversight committee, the commission on health care reform, and to any legislative committee upon request.

Sec. 16.  AGENCY OF HUMAN SERVICES INFORMATION

               TECHNOLOGY

The secretary of the agency of human services shall ensure that the blueprint for health project in the department of health, the global clinical record being developed by the office of Vermont health access, and any other health care‑related information technology initiatives are incorporated into and comply with the statewide health information technology plan developed under 18 V.S.A. § 9417 and any other information technology initiatives coordinated by the secretary of administration pursuant to section 2222a of Title 3. 

Sec. 17.  18 V.S.A. § 9416(a) is amended to read:

§ 9416.  VERMONT PROGRAM FOR QUALITY IN HEALTH CARE

(a)  The commissioner shall contract with the Vermont Program for Quality in Health Care, Inc. to implement and maintain a statewide quality assurance system to evaluate and improve the quality of health care services rendered by health care providers of health care facilities, including managed care organizations, to determine that health care services rendered were professionally indicated or were performed in compliance with the applicable standard of care, and that the cost of health care rendered was considered reasonable by the providers of professional health services in that area.  The commissioner shall ensure that the information technology components of the quality assurance system are incorporated into and comply with the statewide health information technology plan developed under section 9417 of this title and any other information technology initiatives coordinated by the secretary of administration pursuant to section 2222a of Title 3. 

Sec. 18.  18 V.S.A. § 9417 is amended to read:

§ 9417.  HEALTH INFORMATION TECHNOLOGY

(a)  The commissioner shall facilitate the development of a statewide health information technology plan that includes the implementation of an integrated electronic health information infrastructure for the sharing of electronic health information among health care facilities, health care professionals, public and private payers, and patients.  The plan shall include standards and protocols designed to promote patient education, patient privacy, physician best practices, electronic connectivity to health care data, and, overall, a more efficient and less costly means of delivering quality health care in Vermont.

(b)  The health information technology plan shall:

(1)  support the effective, efficient, statewide use of electronic health information in patient care, health care policymaking, clinical research, health care financing, and continuous quality improvements;

(2)  educate the general public and health care professionals about the value of an electronic health infrastructure for improving patient care;

(3)  promote the use of national standards for the development of an interoperable system, which shall include provisions relating to security, privacy, data content, structures and format, vocabulary, and transmission protocols;

(4)  propose strategic investments in equipment and other infrastructure elements that will facilitate the ongoing development of a statewide infrastructure; and

(5)  recommend funding mechanisms for the ongoing development and maintenance costs of a statewide health information system;

(6)  incorporate the existing health care information technology initiatives in order to avoid incompatible systems and duplicative efforts;

(7) integrate the information technology components of the blueprint for health project in the department of health, the global clinical record and all other Medicaid management information systems being developed by the office of Vermont health access, information technology components of the quality assurance system, the program to capitalize electronic medical record systems in primary care practices with loans and grants, and any other information technology initiatives coordinated by the secretary of administration pursuant to section 2222a of Title 3; and

(8)  address issues related to data ownership, governance, and confidentiality and security of patient information.

(c)  The commissioner shall contract with the Vermont information technology leaders (VITL), a broad-based health information technology advisory group that includes providers, payers, employers, patients, health care purchasers, information technology vendors, and other business leaders, to develop the health information technology plan, including applicable standards, protocols, and pilot programs.  In carrying out their responsibilities under this section, members of VITL shall be subject to conflict of interest policies established by the commissioner in the certificate of need regulations to ensure that deliberations and decisions are fair and equitable.

(d)  The following persons shall be members of VITL:

(1)  the commissioner of information and innovation, who shall advise the group on technology best practices and the state’s information technology policies and procedures, including the need for a functionality assessment and feasibility study related to establishing an electronic health information infrastructure under this section;

(2)  the director of the office of Vermont health access or his or her designee; and

(3)  the commissioner of health or his or her designee; and

(3)(4)  the commissioner or his or her designee.

(e)  On or before July 1, 2006, VITL shall initiate a pilot program involving at least two hospitals using existing sources of electronic health information to establish electronic data sharing for clinical decision support, pursuant to priorities and criteria established in conjunction with the health information technology advisory group.  Objectives of the pilot program may include:

(1)  Objectives of the pilot program shall include:

(A)  supporting patient care and improving quality of care;

(2)(B)  enhancing productivity of health care professionals and reducing administrative costs of health care delivery and financing;

(2)  Objectives of the pilot program may include:

(3)(A)  determining whether and how best to expand the pilot program on a statewide basis;

(4)(B)  implementing strategies for future developments in health care technology, policy, management, governance, and finance; and

(5)(C)  ensuring patient data confidentiality at all times.

(f)  The standards and protocols developed by VITL shall be no less stringent than the “Standards for Privacy of Individually Identifiable Health Information” established under the Health Insurance Portability and Accountability Act of 1996 and contained in 45 C.F.R., Parts 160 and 164, and any subsequent amendments.  In addition, the standards and protocols shall ensure that there are clear prohibitions against the out-of-state release of individually identifiable health information for purposes unrelated to treatment, payment, and health care operations, and that such information shall under no circumstances be used for marketing purposes.  The standards and protocols shall require that access to individually identifiable health information is secure and traceable by an electronic audit trail.

(g)  On or before January 1, 2007, VITL shall submit to the secretary of administration, the commissioner, the commissioner of information and innovation, the director of the office of Vermont health access, and the general assembly a preliminary health information technology plan for establishing a statewide, integrated electronic health information infrastructure in Vermont, including specific steps for achieving the goals and objectives of this section.  A final plan shall be submitted July 1, 2007.   The plan shall include also recommendations for self-sustainable funding for the ongoing development, maintenance, and replacement of the health information technology system.  Upon recommendation by the commissioner and approval by the general assembly, the plan shall serve as the framework within which certificate of need applications for information technology are reviewed under section 9440b of this title by the commissioner.

(h)  Beginning January 1, 2006, and annually thereafter, VITL shall file a report with the secretary of administration, the commissioner, the commissioner of information and innovation, the director of the office of Vermont health access, and the general assembly.  The report shall include an assessment of progress in implementing the provisions of this section, recommendations for additional funding and legislation required, and an analysis of the costs, benefits, and effectiveness of the pilot program authorized under subsection (e) of this section, including, to the extent these can be measured, reductions in tests needed to determine patient medications, improved patient outcomes, or reductions in administrative or other costs achieved as a result of the pilot.  In addition, VITL shall file quarterly progress reports with the secretary of administration, the health access oversight committee and shall publish minutes of VITL meetings and any other relevant information on a public website.

(i)  VITL is authorized to seek matching funds to assist with carrying out the purposes of this section.  In addition, it may accept any and all donations, gifts, gifts, and grants of money, equipment, supplies, materials, and services from the federal or any local government, or any agency thereof, and from any person, firm, or corporation for any of its purposes and functions under this section and may receive and use the same subject to the terms, conditions, and regulations governing such donations, gifts, and grants.

(j)  The commissioner, in consultation with VITL, may seek any waivers of federal law, rule, or regulation that might assist with implementation of this section.

(k) The commissioner, in collaboration with VITL and other departments and agencies of state government, shall establish a loan and grant program to provide for the capitalization of electronic medical records systems at primary care practices.  Health information technology acquired under a grant or loan authorized by this section shall comply with data standards for interoperability adopted by VITL and the state health information technology plan.  An implementation plan for this loan and grant program shall be incorporated into the state health information technology plan. 

* * * Multi-Payer Database and

Consumer Price and Quality Information * * *

Sec. 19.  18 V.S.A. § 9410 is amended to read:

§ 9410.  HEALTH CARE DATA BASE DATABASE

(a)(1)  The commissioner shall establish and maintain a unified health care data base to enable the commissioner to carry out the duties under this chapter and Title 8, including:

(1)(A)  Determining the capacity and distribution of existing resources.

(2)(B)  Identifying health care needs and informing health care policy.

(3)(C)  Evaluating the effectiveness of intervention programs on improving patient outcomes.

(4)(D)  Comparing costs between various treatment settings and approaches.

(5)(E)  Providing information to consumers and purchasers of health care.

(F)  Improving the quality and affordability of patient health care and health care coverage.

(2)(A)  The program authorized by this section shall include a consumer health care price and quality information system designed to make available to consumers transparent health care price information, quality information, and such other information as the commissioner determines is necessary to empower individuals, including uninsured individuals, to make economically sound and medically appropriate decisions.

(B)  The commissioner shall convene a working group composed of the commissioner of health, the director of the office of Vermont health access, health care consumers, the office of the health care ombudsman, employers and other payers, health care providers and facilities, the Vermont program for quality in health care, health insurers, and any other individual or group appointed by the commissioner to advise the commissioner on the development and implementation of the consumer health care price and quality information system.

(C)  The commissioner may require a health insurer covering at least five percent of the lives covered in the insured market in this state to file with the commissioner a consumer health care price and quality information plan in accordance with regulations adopted by the commissioner. 

(D)  The commissioner shall adopt such regulations as are necessary to carry out the purposes of this subdivision.  The commissioner’s regulations may permit the gradual implementation of the consumer health care price and quality information system over time, beginning with health care price and quality information that the commissioner determines is most needed by consumers or that can be most practically provided to the consumer in an understandable manner.   The regulations shall permit health insurers to use security measures designed to allow subscribers access to price and other information without disclosing trade secrets to individuals and entities who are not subscribers.  The regulations shall avoid unnecessary duplication of efforts relating to price and quality reporting by health insurers, health care providers, health care facilities, and others, including activities undertaken by hospitals pursuant to their community report obligations under section 9405b of this title. 

* * *

(c)  Health insurers, health care providers, health care facilities and governmental agencies shall file reports, data, schedules, statistics, or other information determined by the commissioner to be necessary to carry out the purposes of this section.  Such information may include:

(1)  health insurance claims and enrollment information used by health insurers;

(2)  information relating to hospitals filed under subchapter 7 of this chapter (hospital budget reviews); and

(3)  any other information relating to health care costs, prices, quality, utilization, or resources required to be filed by the commissioner.

* * *

(h)(1)  Data Collection and Information Sharing.  All health insurers shall electronically provide to the commissioner in accordance with standards and procedures adopted by the commissioner by rule:

(A)  their encrypted health insurance claims data;

(B)  cross-matched claims data on requested members, subscribers, or policyholders; and

(C)  member, subscriber, or policyholder information necessary to determine third party liability for benefits provided.

(2)  The collection, storage, and release of health care data and statistical information that is subject to the federal requirements of the Health Insurance Portability and Accountability Act (“HIPAA”) shall be governed exclusively by the rules adopted thereunder in 45 CFR Parts 160 and 164.

(A)  All health insurers that collect the Health Employer Data and Information Set (HEDIS) shall annually submit the HEDIS information to the commissioner in a form and in a manner prescribed by the commissioner.

(B)  All health insurers shall accept electronic claims submitted in Centers for Medicare and Medicaid Services format for UB-92 or HCFA-1500 records, or as amended by the Centers for Medicare and Medicaid Services.

(3)(A)  The commissioner shall collaborate with the agency of human services and participants in agency of human services initiatives in the development of a comprehensive health care information system.  The collaboration is intended to address the formulation of a description of the data sets that will be included in the comprehensive health care information system, the criteria and procedures for the development of limited use data sets, the criteria and procedures to ensure that HIPAA compliant limited use data sets are accessible, and a proposed time frame for the creation of a comprehensive health care information system.

(B)  To the extent allowed by HIPAA, the data shall be available as a resource for insurers, employers, providers, purchasers of health care, and state agencies to continuously review health care utilization, expenditures, and performance in Vermont and to enhance the ability of Vermont consumers and employers to make informed and cost-effective health care choices.  In presenting data for public access, comparative considerations shall be made regarding geography, demographics, general economic factors, and institutional size.

(C)  Consistent with the dictates of HIPAA, and subject to such terms and conditions as the commissioner may prescribe by regulation, the Vermont information technology leaders (VITL) shall have access to the database for use in the development of a statewide health information technology plan pursuant to section 9417 of this title, and the Vermont program for quality in health care shall have access to the database for use in improving the quality of health care services in Vermont.

(C)(D)  Notwithstanding HIPAA or any other provision of law, the comprehensive health care information system shall not include or publicly disclose any data that contains direct personal identifiers.  For the purposes of this section, “direct personal identifiers” include information relating to an individual that contains primary or obvious identifiers, such as the individual’s name, street address, e-mail address, telephone number, and Social Security number.

(i)(1)  As used in this section, and without limiting the meaning of subdivision 9402(9) of this title, the term “health insurer” includes:

(A)  any entity defined in subdivision 9402(9) of this title;

(B)  any third party administrator, any pharmacy benefit manager, any entity conducting administrative services for business, and any other similar entity with claims data, eligibility data, provider files, and other information relating to health care provided to Vermont resident, and health care provided by Vermont health care providers and facilities required to be filed by a health insurer under this section;

(C)  any health benefit plan offered or administered by or on behalf of the state of Vermont or an agency or instrumentality of the state; and

(D)  any health benefit plan offered or administered by or on behalf of the federal government with the agreement of the federal government.

(2)  The commissioner may adopt rules to carry out the provisions of this subsection, including standards and procedures requiring the registration of persons or entities not otherwise licensed or registered by the commissioner and criteria for the required filing of such claims data, eligibility data, provider files, and other information as the commissioner determines to be necessary to carry out the purposes of this section and this chapter.

* * * Master Provider Index * * *

Sec. 19a.  MASTER PROVIDER INDEX

(a)  No later than September 1, 2006, a work group shall be convened by the area health education centers (AHEC) program for the purpose of making recommendations for the creation of a master provider index designed to assure uniform and consistent identification and cross‑reference of all Vermont health care professionals in the development and implementation of health care technology in Vermont.  The work group shall:

(1)  be composed of interested parties, including representatives of health care provider associations and societies, public and private insurers, the Vermont program for quality health care (VPQHC), appropriate departments of state government, including the commissioner of the department of banking, insurance, securities, and health care administration or designee, the area health education centers (AHEC) program, and Vermont information technology leaders (VITL), for the purpose of creating a set of common data fields for a master provider index of all health care providers, as defined in subdivision 9402(8) of Title 18;  

(2)  compile recommendations from those parties regarding data fields that are necessary to be included in a database that allows for comprehensive cross‑referencing of the multiple “unique identification codes” applied to health care providers through licensure, credentialing, and billing and claims processing mechanisms for the purpose of supporting the implementation of health information exchange and public health and policy research, analysis and planning;

(3)  provide cost and time estimates for development and implementation of such an index; and

(4)  develop recommendations for the governance of the index and its relationship to other state health information data systems, technologies, and records.

(b)  No later than January 15, 2007, the work group shall report to the general assembly on the information obtained and shall make recommendations regarding the advisability of creating and sustaining a master provider index.  

* * * PROVIDER INITIATIVE * * *

* * * Loan Repayment for Health Care Providers

in Underserved Areas and Health Educators * * *

Sec. 20.  18 V.S.A. § 10a is added to read:

§ 10a.  LOAN REPAYMENT FOR HEALTH CARE PROVIDERS AND HEALTH EDUCATORS FUND

(a)  There is hereby established a special fund to be known as the Vermont educational loan repayment fund which shall be used for the purpose of ensuring a stable and adequate supply of health care providers and health educators to meet the health care needs of Vermonters, with a focus on recruiting and retaining providers and health educators in underserved geographic and specialty areas. 

(b)  The fund shall be established and held separate and apart from any other funds or moneys of the state and shall be used and administered exclusively for the purpose of this section.  The money in the fund shall be invested in the same manner as permitted for investment of funds belonging to the state or held in the treasury.  The fund shall consist of the following:

(1)  Such sums as may be appropriated or transferred thereto from time to time by the general assembly, the state emergency board, or the joint fiscal committee during such times as the general assembly is not in session.

(2)  Interest earned from the investment of fund balances.

(3)  Any other money from any other source accepted for the benefit of the fund.

(c)  The fund shall be administered by the department of health, which shall make funds available to the University of Vermont college of Medicine area health education centers (AHEC) program for loan repayment awards.  The commissioner may require certification of compliance with this section prior to the making of an award.

(d)  AHEC shall administer awards in such a way as to comply with the requirements of Section 108(f) of the Internal Revenue Code.

(e)  AHEC shall make loan repayment awards in exchange for service commitment by health care providers and health educators and shall define the service obligation in a contract with the health care provider or health educator.  Payment awards shall be made directly to the educational loan creditor of the health care provider or health educator.

(f)  Loan repayment awards shall only be available for a health care provider or health educator who :

(1)  is a Vermont resident;

(2)  serves Vermont;

(3)  accepts patients with coverage under Medicaid, Medicare, or other state-funded health care benefit programs, if appropriate; and

(4)  has outstanding educational debt acquired in the pursuit of an undergraduate or graduate degree from an accredited college or university that exceeds the amount of the loan repayment award.

(g)  Additional eligibility and selection criteria will be developed annually by the commissioner in consultation with AHEC and may include local goals for improved service, community needs, or other awarding parameters.

(h)  The commissioner may adopt regulations in order to implement the program established in this section.

(i)  As used in this section, "health care provider" shall mean an individual licensed, certified, or authorized by law to provide professional health care service in this state to an individual during that individual’s medical or dental care, treatment, or confinement.   

* * * Advance Directives * * *

Sec. 21.  18 V.S.A. § 9701 is amended as follows:

§ 9701.  DEFINITIONS

As used in this chapter:

* * *

(3)  “Anatomical gift” shall have the same meaning as provided in subdivision 5238(1) of this title.  

(3)(4)  “Capacity” means an individual’s ability to make and communicate a decision regarding the issue that needs to be decided.

(A)  An individual shall be deemed to have capacity to appoint an agent if the individual has a basic understanding of what it means to have another individual make health care decisions for oneself and of who would be an appropriate individual to make those decisions, and can identify whom the individual wants to make health care decisions for the individual.

(B)  An individual shall be deemed to have capacity to make a health care decision if the individual has a basic understanding of the diagnosed condition and the benefits, risks, and alternatives to the proposed health care.

(4)(5)  “Clinician” means a medical doctor licensed to practice under chapter 23 of Title 26, an osteopathic physician licensed pursuant to subdivision 1750(9) of Title 26, an advance practice registered nurse licensed pursuant to subdivision 1572(4) of Title 26, and a physician’s assistant certified pursuant to section 1733 of Title 26 acting within the scope of the license under which the clinician is practicing.

(5)(6)  “Commissioner” means the commissioner of the department of health.

(6)(7)  “Do-not-resuscitate order” or “DNR order” means a written order of the principal’s clinician directing health care providers not to attempt resuscitation.

(7)(8)  “DNR identification” means a document, bracelet, other jewelry, wallet card, or other means of identifying the principal as an individual who has a DNR order.

(8)(9)  “Emergency medical personnel” shall have the same meaning as provided in section 2651 of Title 24.

(9)(10)  “Guardian” means a person appointed by the probate court who has the authority to make medical decisions pursuant to subdivision 3069(b)(5) of Title 14.

(10)(11)  “Health care” means any treatment, service, or procedure to maintain, diagnose, or treat an individual’s physical or mental condition, including services provided pursuant to a clinician’s order, and services to assist in activities of daily living provided by a health care provider or in a health care facility or residential care facility.

(11)(12)  “Health care decision” means consent, refusal to consent, or withdrawal of consent to any health care.

(12)(13)  “Health care facility” shall have the same meaning as provided in subdivision 9432(7) of this title.

(13)(14) “Health care provider” shall have the same meaning as provided in subdivision 9432(8) of this title and shall include emergency medical personnel.

(14)(15)  “HIPAA” means the Health Insurance Portability and Accountability Act of 1996, codified at 42 U.S.C. § 1320d and 45 C.F.R.

§§ 160-164.

(15)(16)  “Informed consent” means the consent given voluntarily by an individual with capacity after being fully informed of the nature, benefits, risks, and consequences of the proposed health care, alternative health care, and no health care.

(16)(17)  “Interested individual” means:

(A)  the principal’s spouse, adult child, parent, adult sibling, adult grandchild, reciprocal beneficiary, or clergy person; or

(B)  any adult who has exhibited special care and concern for the principal and who is personally familiar with the principal’s values.

(17)(18)  “Life sustaining treatment” means any medical intervention, including nutrition and hydration administered by medical means and antibiotics, which is intended to extend life and without which the principal is likely to die.

(18)(19)  “Nutrition and hydration administered by medical means” means the provision of food and water by means other than the natural ingestion of food or fluids by eating or drinking.  Natural ingestion includes spoon feeding or similar means of assistance.

(19)(20)  “Ombudsman” means an individual appointed as a long-term care ombudsman under the program contracted through the department of aging and independent living pursuant to the Older Americans Act of 1965, as amended.

(20)(21)  “Patient’s clinician” means the clinician who currently has responsibility for providing health care to the patient.

(21)(22)  “Principal” means an adult who has executed an advance directive.

(22)(23)  “Principal’s clinician” means a clinician who currently has responsibility for providing health care to the principal.

(23)(24)  “Probate court designee” means a responsible, knowledgeable individual independent of a health care facility designated by the probate court in the district where the principal resides or the county where the facility is located.

(25)  “Procurement organization” shall have the same meaning as in subdivision 5238(10) of this title.

(24)(26)  “Reasonably available” means able to be contacted with a level of diligence appropriate to the seriousness and urgency of a principal’s health care needs, and willing and able to act in a timely manner considering the urgency of the principal’s health care needs.

(25)(27)  “Registry” means a secure, web-based database created by the commissioner to which individuals may submit an advance directive or information regarding the location of an advance directive that is accessible to principals and agents and, as needed, to individuals appointed to arrange for the disposition of remains, organ procurement organizations, tissue and eye banks, health care providers, health care facilities, residential care facilities, funeral directors, crematory operators, cemetery officials, probate court officials, and the employees thereof.

(26)(28)  “Residential care facility” means a residential care home or an assisted living residence as those terms are defined in section 7102 of Title 33.

(27)(29)  “Resuscitate” or “resuscitation” includes chest compressions and mask ventilation; intubation and ventilation; defibrillation or cardioversion; and emergency cardiac medications provided according to the guidelines of the American Heart Association’s Cardiac Life Support program.

(28)(30)  “Suspend” means to terminate the applicability of all or part of an advance directive for a specific period of time or while a specific condition exists.

Sec. 22.  18 V.S.A. § 9702 is amended to read:

§ 9702.  ADVANCE DIRECTIVE

(a)  An adult may do any or all of the following in an advance directive:

* * *

(10)  identify those interested individuals, or entities, whether or not otherwise qualified to bring an action under section 9718 of this title, who shall or shall not have authority to bring an action under that section;

* * *

(13)  identify a preferred primary care clinician and affirm that the clinician has been notified;

* * *

(c)  The principal’s health care provider may not be the principal’s agent. Unless related to the principal by blood, marriage, civil union, or adoption, an agent may not be an owner, operator, employee, agent, or contractor of a residential care facility, a health care facility, or a correctional facility in which the principal resides at the time of execution of an advance directive.

(d)  Unless related to the principal by blood, marriage, civil union, or adoption, an individual may not exercise the authority pursuant to an advance directive for disposition of remains, anatomical gifts, or funeral goods and services while serving the interests of the principal in one of the following capacities:

(1)  a funeral director or employee of the funeral director;

(2)  a crematory operator or employee of the crematory operator; or

(3)  a cemetery official or employee of the cemetery; or

(4)  an employee or representative of a procurement organization.

Sec. 23.  18 V.S.A. § 9704 is amended to read:

§ 9704.  AMENDMENT, SUSPENSION, AND REVOCATION

* * *

(b)(1)  Except as provided in subdivision (2)(3) of this subsection, a principal with or without capacity may suspend or revoke all or part of an advance directive, including the designation of an agent:

(A)  by signing a statement suspending or revoking the designation of an agent all or part of an advance directive;

 (B) by personally informing the principal's clinician, who shall make a written record of the suspension or revocation in the principal's medical record; or

(C)  by burning, tearing, or obliterating the advance directive, either by the principal personally or by another person at the principal’s express direction and in the presence of the principal; or

(D)  For any provision other than the designation of an agent, orally, in writing, or by any other act evidencing a specific intent to suspend or revoke.

(2)  Except as provided in subdivision (3) of this subsection, a principal with or without capacity may suspend or revoke any provision other than the designation of an agent, orally, in writing, or by any other act evidencing a specific intent to suspend or revoke.

(2)(3)  A provision in an advance directive executed pursuant to subsection 9707(h) of this title may be suspended or revoked only if the principal has capacity.

(3)(4)  To the extent possible, the principal shall communicate any suspension or revocation to the agent or other interested individual.

(c)(1)  A clinician, health care provider, health care facility, or residential care facility who becomes aware of an amendment, suspension, or revocation while treating an incapacitated principal shall make reasonable efforts to:

* * *

(C) flag the amendment, suspension, or revocation in the principal's medical record on the front of the medical folder or on the front of any advance directive filed in the medical record; and

(D)  notify the principal, agent, and guardian of the amendment, suspension, or revocation; and

(E)  inform the registry of the amendment, suspension, or revocation.

* * *

(3)  A health care provider, health care facility, or residential care facility not currently providing health or residential care to a principal who becomes aware of an amendment, suspension, or revocation shall ensure that the amendment, suspension, or revocation is recorded and flagged in the principal’s medical record and is submitted to the registry.

* * *

Sec. 24.  18 V.S.A. § 9712 is amended to read:

§ 9712.  OBLIGATIONS OF FUNERAL DIRECTORS, CREMATORY

              OPERATORS, CEMETERY OFFICIALS, PROCUREMENT

              ORGANIZATIONS, AND INDIVIDUALS APPOINTED TO

              ARRANGE FOR THE DISPOSITION OF THE PRINCIPAL’S

              REMAINS

* * *

(c)  Any procurement organization having knowledge of a principal’s advance directive shall follow the advance directive and any instructions of the individual appointed in the advance directive to arrange for the recovery of the principal’s anatomical gifts unless the procurement organization determines such gifts are unsuitable for the purposes for which they are made or if recovery of such gifts would cause the procurement organization to violate standards of professional conduct or any applicable regulation or law.

(c)(d)  Every funeral director, crematory operator, and cemetery official, and procurement organization shall develop systems:

(1)  to ensure that a principal’s advance directive is promptly available when services are to be provided, including that the existence of an advance directive is prominently noted on any file jacket or folder, and that a note is entered into any electronic database of the director, operator, or official, or organization;

(2)  within 120 days of the commissioner’s announcing the availability of the registry, to ensure that the director, operator, official, or organization checks the registry at the time services are to be provided to determine whether the decedent has an advance directive.  

(d)(e)  In the event the principal’s instructions in an advance directive regarding disposition of remains or for funeral goods and services are in apparent conflict with a contract entered into by the principal for the disposition of remains, funeral goods, or services, the most recent document created by the principal shall be followed to the extent of the conflict.  Nothing in this subsection shall be construed as limiting any other available remedies.

Sec. 25.  18 V.S.A. § 9713 is amended to read:

§ 9713.  IMMUNITY

* * *

(b)(1) No health care provider, health care facility, residential care facility, funeral director, crematory operator, cemetery official, or any other person acting for or under such person's control shall, if the provider, or facility, director, operator, or official has complied with the provisions of this chapter, be subjected subject to civil or criminal liability for:

(A)  providing or withholding health care or services in good faith pursuant to the provisions of an advance directive, a DNR identification of the principal, the consent of a principal with capacity or of the principal’s agent or guardian, or a decision or objection of a principal; or

(B)  relying in good faith on a suspended or revoked advance directive.

(2)  No funeral director, crematory operator, cemetery official, or procurement organization, or any other person acting for or under such person's control, shall, if the director, operator, official, or organization has complied with the provisions of this chapter, be subject to civil or criminal liability for providing or withholding its services in good faith pursuant to the provisions of an advance directive, whether or not the advance directive has been suspended or revoked.

(2)(3)  Nothing in this subsection shall be construed to establish immunity for the failure to follow standards of professional conduct and to exercise due care in the provision of services.

* * *

Sec. 26. 18 V.S.A. § 9714(b) is amended to read:

(b)  A health care provider, health care facility, residential care facility, funeral home director, crematory operator, or cemetery official, probate court official, or procurement organization, or an employee of any of them, who accesses the registry without authority or when authority has been denied specifically by the principal, agent, or guardian is subject to review and disciplinary action by the appropriate licensing, accreditation, or approving entity.

Sec. 27.  18 V.S.A. § 9718(a) is amended to read:

(a)  A petition may be filed in probate court under this section by:

(1)  a, principal, guardian, agent, ombudsman, or interested individual other than one identified in an advance directive, pursuant to subdivision 9702(a)(10) of this title, as not authorized to bring an action under this section;

(2)  a social worker or health care provider employed by or directly associated with the health care provider, health care facility, or residential care facility providing care to the principal;

(3)  the defender general if the principal is in the custody of the department of corrections; or

(4)  a representative of the state-designated protection and advocacy system if the principal is in the custody of the department of health; or

(5)  an individual or entity identified in an advance directive, pursuant to subdivision 9702(a)(10) of this section, as authorized to bring an action under this section.

Sec. 28.  18 V.S.A. § 9719 is amended to read:

§ 9719.  OBLIGATIONS OF STATE AGENCIES

(a)  Within 180 days of the effective date of this chapter No later than July 1, 2006, and from time to time thereafter, the commissioner, in consultation with all appropriate agencies and organizations, shall adopt rules pursuant to chapter 25 of Title 3 to effectuate the intent of this chapter.  The rules shall cover at least one optional form of an advance directive with an accompanying form providing an explanation of choices and responsibilities, the form and content of clinician orders for life sustaining treatment, the use of experimental treatments, a model DNR order which meets the requirements of subsection 9708(a) of this title, DNR identification, revocation of a DNR identification, and consistent statewide emergency medical standards for DNR orders and advance directives for patients and principals in all settings.  The commissioner shall also provide, but without the obligation to adopt a rule, optional forms for advance directives for individuals with disabilities, limited English proficiency, and cognitive translation needs.

(b)(1)  Within 180 days of the effective date of this chapter Within one year of the effective date of this chapter, the commissioner shall develop and maintain a registry to which a principal may submit his or her advance directive, including a terminal care document and a durable power of attorney. The rules shall describe when health care providers, health care facilities, and residential care facilities may access an advance directive in the registry.  In no event shall the information in the registry be accessed or used for any purpose unrelated to decision-making for health care or disposition of remains, except that the information may be used for statistical or analytical purposes as long as the individual’s identifying information remains confidential.

(2)(A)  Within 180 days one year of the effective date of this chapter, the commissioner shall adopt rules pursuant to chapter 25 of Title 3 on the process for securely submitting, revoking, amending, replacing, and accessing the information contained in the registry.  The rules shall provide for incorporation into the registry of notifications of amendment, suspension, or revocation under subsection 9704(c) of this title and revocations of appointment under subsection 9704(d) of this title.

(B)  The commissioner shall provide to any individual who submits an advance directive to the registry a sticker that can be placed on a driver’s license or identification card indicating that the holder has an advance directive in the registry.

(c)(1)  Within 180 days one year of the effective date of this chapter, the commissioner shall provide on the department’s public website information on advance directives and the registry to appropriate state offices.  The commissioner shall also include information on advance directives, and on the registry and the optional forms of an advance directive.

(2)  Within 180 days one year of the effective date of this chapter, the commissioner of motor vehicles shall provide motor vehicle licenses and identity cards, as soon as existing licenses or cards have been depleted, which allow the license holder or card holder to indicate that he or she has an advance directive and whether it is in the registry.

Sec.  29.  18 V.S.A. § 5240(a) is amended to read:

(a)  Any member of the following classes of individuals, in the order of priority listed, may make an anatomical gift of all or a part of the decedent’s body for an authorized purpose, unless the decedent has made an unrevoked refusal to make that anatomical gift:

(1)  An individual appointed by the decedent, pursuant to an advance directive under chapter 231 of this title, to make an anatomical gift.

(1)(2)  The spouse of the decedent.

(2)(3)  The reciprocal beneficiary of the decedent.

(3)(4)  An adult son or daughter of the decedent.

(4)(5)  Either parent of the decedent.

(5)(6)  An adult brother or sister of the decedent.

(6)(7)  A grandparent of the decedent.

(7)(8)  An individual possessing a durable power of attorney agent named in an advance directive.

(8)(9)  A guardian of the person of the decedent at the time of death.

(9)(10)  Any other individual authorized or under obligation to dispose of the body.

* * *  Improving Access to Care * * *

Sec. 29a.  FQHC LOOK-ALIKES AND UNCOMPENSATED CARE POOL

(a) Funds appropriated to the department of health in Section 263(e)(4) and Section 255(a)(7)(C) related to Section 277(f) of Act 71 of 2005 for state fiscal year 2006 may be carried forward by the department for the purposes described in Section 277(f) of Act 71 of 2005  to state fiscal year 2007.  Of those appropriated funds, a total of $150,000  shall be provided as a direct grant to new federally qualified health center look-alike entities approved during state FY06 and shall be split evenly between qualifying organizations on a non-competitive basis.

(b) Funds appropriated in Section 30 of this act to the department of health shall be expended for the purpose of providing to federally qualified health center (FQHC) look-alikes uncompensated care pool funds for an income‑sensitized sliding scale fee schedule for patients of these organizations.  In distributing the grants, the department shall consider ensuring the geographic distribution of health centers around the state as well as criteria under federal law.  Initial priority shall be given to health centers in Lamoille, Washington, Windsor/Windham, and Addison counties, and other counties that demonstrate readiness to achieve look-alike status.  The goal shall be to ensure there are FQHC look-alikes in each county in Vermont

(c)  If funds appropriated for this Section exceed $200,000, additional uncompensated care pool funds shall be made available to primary care practices meeting conditions for serving a disproportionate share of the uninsured and Medicaid populations comparable to the federal expectations for federally qualified health centers and look-alikes, including:

(1) Seeing all patients regardless of ability to pay, on a sliding scale fee schedule;

(2) Remaining open to new and existing patients enrolled in the Medicaid and Medicare programs;

(3) Maintaining no less than a combined 25 percent Medicaid and uninsured patient payer mix; and

(4)   Participating in the blueprint for health program as it expands across the state.

(5) Existing federally qualified health center Section 330 grantees shall also be eligible to participate in this uncompensated care pool.

(6)  Funding from the pool shall not be permitted to supplant existing state, federal or private grants or funding for pre-existing “charity care” and patient assistance programs.

(d) Uncompensated care pool funds under this section shall be distributed to participating providers under criteria and methodology developed by the department of health office of rural health and primary care and bi-state primary care association, with input from the Vermont medical society and Vermont chapter of the American academy of family practice physicians. 

(e) If deemed appropriate, funds appropriated for this section may be disbursed by the Vermont community foundation or other suitable charitable organization.

Sec. 29b.  MEDICAID OUTREACH

Bi-State Primary Care Association, in consultation with the Medicaid Advisory Board,  will research efforts in Vermont and in other states that have succeeded in enrolling individuals eligible for Medicaid and Medicaid waiver programs.   The association will report its findings and recommendations to the house committee on health care, the senate committee on health and welfare, the health access oversight committee and the agency of human services no later than November 15, 2006. 

* * * Appropriations * * *

Sec. 30.  APPROPRIATIONS

(a)  For fiscal year 2007, the sum of $500,000.00 is appropriated from the general fund and $200,000.00 from the department of banking, insurance, securities and health care administration special fund for the pilot program authorized under 18  V.S.A. § 9417(e) and to contract for the development of the health information technology plan and other duties in 18 V.S.A. § 9417.

(b)  For fiscal year 2007, the sum of $160,000.00 is appropriated from the general fund to the department of health for development and implementation of the patient safety surveillance and improvement system established pursuant to 18 V.S.A. § 1912.  The sum of $40,000.00 shall be contributed from hospitals licensed in Vermont and shall be collected by the department of health with assistance from the department of banking, insurance, securities, and health care administration. 

(c)  For fiscal year 2007, the sum of $400,000.00 is appropriated from the general fund to the department of banking, insurance, securities, and health care administration for further development of the multi-payer database established by 18 V.S.A. § 9410(h), and the consumer price and quality information system.  

(d)  The sum of $880,000.00 is appropriated from the general fund to the department of health in fiscal year 2007 to fund the Vermont educational loan repayment fund program established under Sec. 20. 

(e)  The sum of $80,000.00 is appropriated from the general fund to the department of health in fiscal year 2007 to fund loan forgiveness programs for health care providers through the dental hygienist incentive loan program and the nursing incentive loan program, as administered through the Vermont student assistance corporation.

(f)  The sum of $50,000.00 is appropriated from the general fund to the department of health in fiscal year 2007 to establish an advance directive registry established by 18 V.S.A. § 9719.

(g)  For fiscal year 2007, the sum of $200,000.00 is appropriated from the general fund to the department of health for federally qualified health center (FQHC) look-alike uncompensated care pool funds, as described in section 29a. 

(h)  For fiscal year 2007, the sum of $40,000.00 is appropriated to the Agency of Human Services, upon approval by the health access oversight committee of AHS plans for Medicaid outreach, consistent with the report specified in section 29b.   

* * * Technical Provision * * *

Sec. 31.   TECHNICAL PROVISION

Except for subdivision 2222a(c)(1) of Title 3, the provisions in Sec. 15 of this Act shall supersede any conflicting provisions in Sec. 3 of H.861 (An Act Relating to Health Care Affordability for Vermonters) if enacted.  Subdivision (c)(1) of section 2222a of Title 3, if enacted in H.861, shall supercede subdivision (c)(1) of section 2222a of Title 3 in this act. Any additional provisions contained in Sec. 3 of H.861 that are not contained in Sec. 15 of this Act shall not be superseded.  Any technical revisions necessary to ensure accuracy or conformity between the sections, such as the numbering of subdivisions, may be made the office of legislative council.