Vermont鈥檚 largest hospital has proposed a wide-ranging deal with the state health care regulator after months of private negotiations.
The move comes after the hospital exceeded its agreed-upon revenue by over $50 million last year and the Green Mountain Care Board is considering enforcement actions, while the hospital has appealed several budget decisions in court.
This week, the University of Vermont Medical Center in Burlington instead as part of a compromise that includes:
- $11 million to primary care providers that aren鈥檛 affiliated with hospitals
- $12 million to the insurance company BlueCross BlueShield of Vermont
- Up to $15 million to hire consultants to identify ways to make the hospital more cost efficient and to hire an independent liaison to improve communication between the hospital and board around budgets
The proposal would also set stipulations around executive bonuses next year, partially tying them to outcomes like reducing emergency department visits and bringing down commercial insurance rates.
In exchange, state regulators would drop any enforcement action against the hospital for their revenue overages last year.
It would also give the hospital more time to pay back previous overages 鈥� in the form of reducing patient revenue 鈥� which exceeded $80 million in fiscal year 2023. That means losing out on the potential to require the hospital to further reduce its revenue, which would drive down health care prices in the short term.
鈥淭hat鈥檚 ultimately the trade off,鈥� said Owen Foster, the chair of the Green Mountain Care Board.
鈥淭here鈥檚 some really important funding for primary care and BlueCross, there鈥檚 some retention of monies and some spreading out of monies over time for UVM,鈥� he said.
Foster and another board member worked with hospital leaders on the compromise over nearly a dozen meetings, and the full board is set to vote on the proposal next week.
鈥淢embers of our community, members of this board, have lost trust in our decisions,鈥� Dr. Sunny Eappen, head of the UVM Health Network, told board members at a meeting Wednesday and , referring to cuts to patient services announced at the end of last year.
鈥淲e鈥檙e here today with a proposal to increase our transparency and accountability,鈥� he said.
Members of our community, members of this board, have lost trust in our decisions.Dr. Sunny Eappen, UVM Health Network CEO
Several members of the Green Mountain Care Board not involved in the negotiations expressed some trepidation about the proposal.
鈥淎nother option could have been to lower commercial prices so that things were more affordable immediately,鈥� said Thom Walsh, another board member.
鈥淲hat we鈥檙e talking about is an agreement where prices will not come down as far as they might have,鈥� he said.
The hospital did not have details on how they might disperse funding to primary care practices, though they said the money could serve as a bridge to providers after the end of the year, when monthly payments to many independent practices will stop.
The payment to BlueCross BlueShield of Vermont would aim to resolve claims that UVM Medical Center overcharged the insurer, according to the proposal. Several board members said the insurance company is facing insolvency after reporting years of multi-million dollar losses, and these funds would provide some relief.
Hospital leaders described the provision to hire consultants as an investment that would ultimately drive down the cost of care. That work would last just over a year and could include a review of services provided by UVM Health Network, evaluating the network鈥檚 financial relationship with New York hospitals and reviewing the productivity of clinicians, among other measures.
The money set aside for consultants is a cap, explained Foster, the board chair.
鈥淚t might be $3 million or it might be $15 [million],鈥� he said.
The board is currently accepting before a vote next week.
