Introduced by Representative Obuchowski of Rockingham
Subject: Health; single payer; hospital coverage; global budget
Statement of purpose: This bill proposes to provide hospital coverage for all Vermonters.
AN ACT RELATING TO UNIVERSAL HOSPITAL ACCESS FOR VERMONTERS
It is hereby enacted by the General Assembly of the State of Vermont:
Sec. 1. LEGISLATIVE FINDINGS
The general assembly finds that:
(1) Vermonters, their employers, and private insurers currently spend over $500 million for hospital care. Of this amount, patients pay approximately five percent at time of service, with the balance paid by individuals, employees, and employers through insurance premiums. Employers contribute an estimated 75 percent of health insurance costs with employees paying the remaining 25 percent.
(2) State coverage for Vermonters’ hospital care does not raise the amount spent for the care. The state is only replacing the amount currently spent on hospital care through premiums and patient cost sharing with a tax-based system. Funding hospital care through a
tax-based system is estimated to reduce private insurance premiums by approximately 40 percent, thus providing more affordable premiums to employers and Vermonters.
(3) Because the state will assume the cost of hospital care, the state agencies responsible for oversight of health care spending should have additional incentives for cost containment. A global hospital budget is designed to control hospital spending, including annual growth, and thus will assist the state in controlling the costs of the universal hospital access for Vermonters health care plan.
(4) Universal hospital access is an initial step toward providing affordable health care coverage to all Vermonters.
Sec. 2. 33 V.S.A. chapter 19, subchapter 3 is amended to read:
Subchapter 3. Vermont Health Access Trust Fund
* * *
§ 1972. VERMONT HEALTH ACCESS TRUST FUND ESTABLISHED
The Vermont health access trust fund is hereby established as a special fund
in the state treasury for the purpose of
establishing a special fund to be
the single source to finance financing health care coverage for
beneficiaries of all state health care assistance programs
administered by the department of prevention, assistance, transition, and
health access agency of human services, including the universal hospital
access for Vermonters health care plan.
(b) Into the fund shall be deposited:
(1) revenue from the cigarette and tobacco products tax established in chapter 205 of Title 32;
(2) revenue from health care provider assessments collected and deposited into the health care trust fund pursuant to subchapter 2 of chapter 19 of this title;
(3) transfers from the tobacco litigation settlement fund established in section 435a of Title 32, authorized by the general assembly;
transfers from the general fund, authorized by the general assembly;
(5) the proceeds from grants, donations, contributions, and taxes and any other sources of revenue as may be provided by statute or by rule;
(6) all federal receipts for health care purposes, including all Medicaid receipts and all Medicare receipts upon federal approval; and
(7) revenue from the sources established to fund the universal hospital access plan established under subchapter 6 of chapter 19 of this title.
(c) The fund shall be administered pursuant to subchapter 5 of chapter 7 of Title 32, except that interest earned on the fund and any remaining balance shall be retained in the fund. The department shall maintain records indicating the amount of money in the fund at any time.
(d) All monies received by or
generated to the fund shall be used only for the administration and delivery of
health care covered through state health care assistance programs administered
department of prevention, assistance, transition, and health access
agency of human services, including the Medicaid program, the Vermont
health access plan program, the Vermont health access plan-pharmacy program,
the VScript program, the VScript-Expanded program, the state children’s health
insurance program, the General Assistance program, the universal hospital
access for Vermonters health care plan, and any other state health
care assistance program administered by or through the department agency.
Sec. 3. 33 V.S.A. chapter 19, subchapter 6 is added to read:
Subchapter 6. Universal Hospital Access for Vermonters Health Care Plan
§ 2031. PURPOSE
The purpose of this subchapter is to provide all Vermonters access to and coverage for health services provided in hospitals. The general assembly recognizes that the health care system is in crisis, and that Vermonters do not have the financial ability to pay increasing health insurance premiums or the rising costs of health care. Vermonters need access to hospital care, regardless of ability to pay or insurance coverage. Additionally, the state must seek financial sustainability of the health care system, including reducing health care spending.
§ 2032. DEFINITIONS
As used in this subchapter:
(1) “Health service” means any medically necessary treatment or procedure to maintain, diagnose, or treat an individual’s physical or mental condition, including services provided pursuant to a physician’s order and services to assist in activities of daily living provided in a hospital.
(2) “Hospital” shall have the same meaning as in section 1902 of Title 18 and may include hospitals located out of state.
(3) “Vermont resident” means an individual domiciled in Vermont as evidenced by an intent to maintain a principal dwelling place in Vermont indefinitely and to return to Vermont if temporarily absent, coupled with an act or acts consistent with that intent. The secretary of human services shall establish specific criteria for showing residency.
§ 2033. UNIVERSAL HOSPITAL ACCESS FOR VERMONTERS
HEALTH CARE PLAN BOARD
The governor shall appoint, with the advice of the senate, three individuals to serve as members of the Vermont health care plan board within 60 days of passage of this section. Members shall serve for three-year terms or until a successor is appointed, except that initial terms shall be staggered so that no more than one board member’s office shall become vacant during any calendar year. The governor may remove a member from office only for cause, after notice and hearing.
§ 2034. UNIVERSAL HOSPITAL ACCESS FOR VERMONTERS HEALTH
(a) The board established under section 2033 of this title shall administer the universal hospital access for Vermonters health care plan and shall adopt by rule standards and procedures necessary to provide coverage of health services in hospitals.
(b) The universal hospital access for Vermonters health care plan shall provide Vermont residents coverage for health services received in a hospital.
(c) The board shall establish by rule income-sensitized deductibles, co‑payments, or other cost-sharing amounts applicable to the universal hospital access for Vermonters health care plan established by this subchapter.
(d) A beneficiary aggrieved by an adverse decision of the agency may appeal to the human services board as provided for in section 3090 of Title 3.
(e) A health service that may be covered in whole or in part by Title XVIII of the Social Security Act (Medicare) or by any other public health benefit plan, including Medicaid or the Vermont health access plan, shall be funded from those payment sources. Vermont residents accessing health services at a hospital shall be considered Medicare beneficiaries for purposes of chapter 65 of this title (Medicare balance billing).
(f) Payment of health services provided pursuant to this subchapter shall be reimbursed as provided for in section 2035 of this title.
§ 2035. GLOBAL HOSPITAL PAYMENT FOR VERMONT RESIDENTS
The board shall negotiate with hospitals for a global hospital payment for health services provided by the universal hospital access for Vermonters health care plan. The board shall consider the global hospital budget under section 9461 of Title 18 and other information necessary to the determination of the appropriate payment, including all other revenue received from other sources. The board shall adopt by rule standards and procedures necessary to implement this section.
Sec. 4. 18 V.S.A. § 9461 is added to read:
§ 9461. GLOBAL HOSPITAL BUDGET
(a) Annually, the commissioner of banking, insurance, securities, and health care administration, in consultation with the universal hospital access board established under section 2033 of Title 33, shall develop a global hospital budget for each hospital located in Vermont. The commissioner and the board shall consider the portions of the health resource allocation plan under section 9405 of this title, the unified health care budget under section 9406 of this title applicable to hospitals, the hospital budget review under section 9456 of this title, the global hospital payments under section 2035 of Title 33, and all other revenue received by hospitals when developing the global hospital budget. The global hospital budget shall be reported annually to the general assembly on or before January 15 for the following fiscal year as part of the agency of human services’ budget allocation request and shall not be effective until approved or modified as part of the annual appropriations process.
(b) The global hospital budget shall serve as a spending cap within which hospital costs are controlled, resources directed, and quality and access assured. The global hospital budget shall limit the total annual growth of hospital costs to the Consumer Price Index plus three percent. The commissioner of banking, insurance, securities, and health care administration shall ensure that the review of individual hospital budgets under subchapter 7 of chapter 221 of this title or certificate of need requests under subchapter 5 of chapter 221 of this title are consistent with the global hospital budget.
(c) The universal hospital access board and the department of banking, insurance, securities, and health care administration shall adopt by rule standards and procedures necessary to implement this subsection.
(d) For purposes of this section, “hospital” shall have the same meaning as in section 1902 of this title.
Sec. 5. STUDY OF FUNDING MECHANISM
(a) A universal hospital access fund special committee is created to determine the appropriate funding mechanisms for the Vermont health care plan and shall consider at a minimum the following funding sources: an income tax, a payroll tax, premiums or cost-sharing measures, a value-added tax, or an other consumption tax.
(b) The universal hospital access fund special committee shall consist of the joint fiscal committee, the chair and vice chair of the health access oversight committee, the secretaries of the agency of human services and agency of administration, the commissioner of the department of banking, insurance, securities, and health care administration, and the members of the universal hospital access board. The committee may meet for no more than six meetings or public hearings and shall have such powers as are needed to carry out the purposes of this section. Committee members who are not
full-time state employees shall be entitled to per diem and expenses as provided in 32 V.S.A. § 1010.
(c) The universal hospital access fund special committee shall issue to the general assembly no later than January 15, 2006 a report with a recommendation on funding the Vermont health care plan.
Sec. 6. 18 V.S.A. § 9437(1) is amended to read:
application is consistent with the health resource allocation plan
Sec. 7. 18 V.S.A. § 9456(c) is amended to read:
(c) Individual hospital budgets established under this section shall:
(1) be consistent with the health resource allocation plan;
(2) take into consideration national, regional, or instate peer group norms, according to indicators, ratios, and statistics established by the commissioner;
(3) promote efficient and economic operation of the hospital;
budget performances for prior years;
(5) include a
finding that the analysis provided in subdivision
(b)(10) (b)(9) of
this section is a reasonable methodology for reflecting a reduction in net
revenues for non-Medicaid payers;
(6) be consistent with the global hospital budget established under section 9461 of this title.
Sec. 8. FEDERAL WAIVERS
(a) The secretary of human services shall apply for a federal Medicare waiver no later than July 1, 2005 to allow the state to include Medicare funds for hospital services in the health access trust fund established under section 1974 of Title 33 and to modify the payment standards or amounts in order to include Medicare funds in the global hospital budget established under section 9461 of Title 18.
(b) The secretary of human services shall apply for a federal Medicaid waiver no later than July 1, 2005 to allow the state to modify the payment standards or amounts in order to include Medicaid funds in the global hospital budget established under section 9461 of Title 18.
Sec. 9. EFFECTIVE DATE
This act shall become effective upon passage, except that the universal hospital access for Vermonters health care plan shall be implemented no later than January 1, 2007.
The Vermont General Assembly
115 State Street