Gov. Scott, officials detail health reform measures

BY MARK R ONDEAU Bennington Banner

MONTPELIER - Gov. Phil Scott held a press conference Wednesday with three state officials heavily involved in healthcare to go over efforts to reduce costs.

The discussion highlighted various initiatives, including efforts by the Agency of Human Services and a bill on health insurance reforms backed by the administration.

"Today, we're going to focus on health care, which I know gets complicated and it isn't the easiest understood topic for most of us," Scott said. "But it's important to talk about it, because fixing our health care system is integral to making Vermont more affordable."

The effects of rising health care costs are not unique to Vermont, he said "It is something many other states are experiencing, but even with the cost of healthcare increasing across the nation, Vermont stands out, and not in a good way, with some of the highest insurance premiums and costs of care in the country," he said. "And with an aging demographic who rely on the system more often. With fewer young people, costs only go up further.

"So, my team put together a health care proposal this session to address the health insurance market in Vermont to make sure Vermonters have access as well as choices when deciding where to get the care they need in all parts of the state," Scott added. "It's focused on three areas: more insurance options for Vermonters, more efficient service delivery, and more accountability on the part of insurance companies."

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SYSTEM IN CRISIS

Jenney Samuelson, secretary of the Agency of Human Services, said Vermont's health care system is in crisis.

"People can't always get the care they need when they need it," she said. "Health care is too expensive for families, employers and the state, and health care institutions are in financial crisis themselves. And too often, care is duplicated, uneven in quality or dependent on where you live."

The current cost trajectory is not sustainable.

"Our healthcare system was built over time to meet the needs of the past. It was designed around in-person care, hospital-based delivery and independent institutions, often operating largely on their own. But Vermont has changed," she said. "We're older, we're more rural. Technology has changed, which allows us to deliver care in different ways, and workforce shortages now affect almost all of the healthcare system. The system we have today is expensive in part because it is built for a Vermont that is very different than the Vermont we have today."

Designing a healthcare system today with affordability, access and quality in mind will look very different. "Affordability doesn't come with one decision or one program," she said. "It comes from redesigning how the systems work together."

Samuelson spoke of four affordability principles, one of which is paying the right amount for care. "We need to stop paying different prices for the same services depending on where it's delivered," she said.

Second, those involved are working to increase access while reducing duplication and waste. "When services are duplicated unnecessarily or not available where they are needed, costs go up and sustainability goes down," she said. "Affordability depends on putting care in the right place and not everywhere."

Third, providers in the state, and the state itself, are focused on making the system work better.

"Affordability requires efficiency, reducing administrative overhead and sharing services where it makes sense," she said. "And our hospitals are making great progress in this area."

Fourth, there is a need to strengthen choices. "Affordability improves when people have meaningful choices and when providers and insurers compete based on value and not volume," she said. "That means preserving patient choice in where and how they receive services and care, encouraging competition among insurers and insurance plans to offer better value and more options, and making prices and options clear so people have can make more informed decisions." Samuelson described ongoing work to redesign the system.

"Work is already underway, levering studies of cost drivers and system performance, including the statewide health systems analysis commissioned by the legislature through Act 167," she said.

Through this and more recently available resources through the federal government, such as the recent Rural Health Transformation Act, the state will be able to change how the system is structured. The funding itself is not the reform. "It's the tool that lets us put affordability plans into action," she said.

With help from the AHS, hospitals across the state are developing concrete transformation plans.

"By March, we'll have actionable proposals aimed at taking the first steps in defining essential services, sharing services and infrastructure, reducing duplication and administrative costs, and aligning care that the community needs with affordability as a requirement and not an afterthought," Samuelson said.

The state also plans to use funds from the federal Rural Health Transformation Act to strengthen primary care by "investing in community health teams and primary care practices, strengthening primary care as the front door to our health care system and reducing reliance on higher cost settings," she said. "Strong primary care is one of the most effective ways to control cost and improve outcomes."

The Rural Health Transformation funding will also be used in numerous ways to strengthen rural health networks, including innovations in the models of care, reducing duplication and improving the quality of care that Vermonters receive, she said.

They're also committed to measures to strengthen the healthcare workforce, through tuition assistance and on-site clinical training.

TAMPED DOWN COSTS

Owen Foster, chair of the Green Mountain Care Board (GMCB), the state's healthcare regulator, said that across the country, hospitals are closing, service is being disrupted and health care costs are exploding.

"In the past four years, Vermont has taken important steps towards addressing these issues, and significant progress has been made," he said.

The GMCB has tamped down Vermont's high health care costs, he said.

"By, one, carefully addressing excessive hospital-based charges. Second, reducing waste in our health care system, including removing unnecessary administrative spending," Foster said. "We have also decreased the expenses associated with an accountable care organization, and we have redirected significant financial investments into primary care and mental health care services."

Such steps have resulted in the state having one of the lowest Affordable Care Act insurance premium increases for 2026 in the entire country, he said "In fact, Vermont's ACA premium increases were the second lowest in the nation last year," he said. "We've done this while, at the same time, not losing a single hospital to closure, and our Vermont based insurance company has begun to see a turnaround [in] its reserves and financial stability."

Much work remains and the Vermont's healthcare system is very fragile, he said.

"Reducing spending at hospitals and insurance companies alone is not a solution. We need system-wide change to increase preventative care and access to non-hospital providers," Foster said. "Fortunately, the necessary foundations have been laid to execute on that needed change."

He cited Act 167 and other bills passed into law last year. These include Act 55 that reduced the amount Vermonters pay for drugs administered at Vermont Hospitals. "Vermont now has the most affordable hospital administered drugs in the country," he said.

In addition, he cited Act 49 which provides important solvency protections for domestic insurance companies and Act 68 which created a framework to implement reference- based pricing for hospitals and supported community providers and preventative healthcare.

Hospitals are working together on ways to reduce supply costs and share providers to lower costs. "And community providers are working to expand access and hours and to take more patients out of the expensive hospital-based system," he said.

INSURANCE REFORMS BILL

Kaj Samsom, Commissioner of the Vermont Department of Financial Regulation, said part of his job is to regulate the insurance markets, domestic insurers, and also licensed insurers that participate in this market.

On Wednesday morning, testimony launched on H. 585, "an act relating to health insurance reforms," put forward by the Scott administration.

He said this bill has 10 distinct pieces to it in three categories: "cost containment, also known as efficient service delivery, governance changes with our domestic health insurers, and choices or options for Vermonters," he said.

Samson addressed one aspect of health insurance choices.

"We're one of two states that does not allow any type of age consideration in an individual's health insurance premium," he said. "That has become increasingly unsustainable in a state that borders New Hampshire and Massachusetts, where that is allowed, and it is allowed by the ACA and is present in 48 other states.

"What this does, and what we seek to make progress in mitigating, is it [contributes to] a lot of this excessive cost of care and affordability challenges we're having," Samson said. "It focuses it on a population we're trying to attract and retain in this state, which is younger Vermonters- that have very clear data to show that they have lower claims volume."

Mark Rondeau can be reached at [email protected]

"People can't always get the care they need when they need it," she said. "Health care is too expensive for families, employers and the state, and health care institutions are in financial crisis themselves. And too often, care is duplicated, uneven in quality or dependent on where you live."

Jenney Samuelson, secretary of the Agency of Human Services, speaks on Wednesday. SNIP FROM VIDEO