Yes, they seemed to be. As I shared in July, NMC’s budget for our upcoming 2016 Fiscal Year (which starts October 1, 2015), contains a request to reduce our rates (these are the “standard” rates that by law, NMC has to set and charge consistently to everyone, before negotiated insurance company and other discounts are applied). This comes even with many of NMC’s current inpatient and outpatient rates already ranking at or below the State average and with no Vermont hospital having a lower cumulative rate increase over the past thirteen years.
On August 26, NMC made a formal presentation to the Green Mountain Care Board (GMCB) which regulates Vermont’s not-for-profit hospitals regarding our proposed budget. Our team provided an overview of the collaborative work we are doing to help address the priorities within the Community Health Needs Assessment, to improve population health, to reduce avoidable costs, and to position ourselves for the healthcare reform shift away from “fee for service” (where providers are paid based on how many patients they see) to population health (where providers are paid to keep the community well). We discussed our financial performance in Fiscal Years 2014 and 2015, where reimbursement changes, strong quality performance in a risk-based contract, and growth in market share and patient volumes resulted in NMC exceeding the GMCB’s 3% revenue cap. We presented our proposal for what exceptions should be made to that cap and how to translate our healthy financial position into an 8% rate reduction.
I am proud of the persistent effort it has taken from NMC’s staff, Medical Staff, community partners, and Board of Directors to have no other Vermont hospital with a lower cumulative rate increase over the past 13 years. Even so, we fully understand that health care is still too expensive. Therefore, we continue to work on savings while improving quality by reducing waste and duplication from the system; creating partnerships and integrating care; and investing in wellness, prevention, and Primary Care to avoid more costly medical interventions in the future. Con Hogan, a member of the GMCB, praised these efforts, saying “You have some great stuff going on: RiseVT, reduced avoidable visits in the ED, lowering re-admission rates, and reduced smoking. You are doing the right things.” Jessica Holmes, another GMCB member agreed, saying “I have a lot of praise for your leadership and system approach. You have a lot of exciting initiatives and you are a leader in many areas.” The five GMCB members each had questions for us, ranging from our approach to forecasting and budgeting revenues, provider compensation, pricing transparency, and the details of the exceptions we presented. We expect the GMCB will take action on NMC’s budget in mid-September.
There was a good discussion of whether a rate decrease at NMC will actually benefit our community within the current regulatory environment or whether it is simply absorbed by the insurance companies with no relief to premiums for businesses or individuals. We appreciate the GMCB being open to that issue and looking at Vermont’s regulatory approach to see what they can do differently to ensure the savings achieved by Vermont’s hospitals are actually passed along through the insurance companies to Vermonters and Vermont employers.
Our session finished with GMCB Chairman Al Gobeille asking whether a community hospital like NMC will have to give up our autonomy to achieve the benefits of integration. I do not believe the two are not mutually exclusive. NMC is giving up some autonomy and achieving valuable integration by collaborating within the Accountable Care Organizations, our Regional Clinical Performance Council, and our Unified Community Collaborative. We are creating shared protocols based on best practice. We are looking for savings through collaborations. We are leveraging partnerships to better meet the needs of our community. True, collaborators do give up some “control” as partners have voices at the table, but it does not mean we have to give up our identity or our focus on this community which we have cared for since 1883. I want to thank the leadership team that I have the great fortune to work with in leading this great organization. These are challenging times and these leaders are passionate about setting the right direction for a sustainable future caring for this community. I would also like to thank the members of our community who attended the budget presentation, including Judy Ashley from the Vermont Department of Health, Emerson Lynn of the St. Albans Messenger, John Hango of Mylan (who serves as NMC’s Board Chair), and Medical Staff President Dr. John Minadeo. We deeply appreciate and value the support and engagement and trust of our entire community. Thank you all for your continued support of local healthcare.
— Jill Berry Bowen, NMC’s Chief Executive Officer