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Green Mountain Care Board Outlines Preliminary Hospital Budgets

July 27, 2017

Green Mountain Care Board Outlines Preliminary Hospital Budgets
Hospitals Project Net Patient Revenue Growth at 3.6% for FY18

The Green Mountain Care Board (GMCB) staff provided a preliminary report to Board members today, outlining the FY 2018 budgets of Vermont’s 14 nonprofit hospitals. Collectively, the hospital system projects a 3.6% net patient revenue growth, just over the 3.4% target set by the Board. The difference equates to $4.7 million or .19% of a $2.5 billion hospital health care system in Vermont. 

“These hospital budgets reflect solid progress toward bending the cost curve and moving towards population health given the slate of challenges hospitals face, including managing ongoing uncertainty at the federal level while also making significant investments in value-based health reform,” said Jeff Tieman, president and CEO of the Vermont Association of Hospitals and Health Systems.

VAHHS noted that each hospital has a unique set of circumstances that inform and impact their financial picture, “No two hospitals in our system are identical which is important to remember as the GMCB digs in on these budgets,” Tieman continued. Factors that have a meaningful impact on budgets include health care utilization, payer mix, pharmaceutical costs, and unique community health needs. In an effort to manage these unknowns, hospitals collectively proposed a 2.4% price increase for FY18, a number near inflation and also one of the lowest increases in 17 years.

Four Vermont hospitals, University of Vermont Medical Center, Central Vermont Medical Center, Northwestern Medical Center and Porter Medical Center submitted budgets for the second year that reflect their participation in the Next Generation Medicaid program through the All-Payer Model. These hospitals are assuming the risk for 30,000 Medicaid patients and receive a lump sum for providing care, which must be shared with all providers in the continuum not just those at the hospitals. And all of Vermont’s hospitals are carefully considering how and when to move forward with this value based model of health care delivery.   

Additionally, these budgets reflect important investments in Vermont communities including those identified by the Community Health Needs Assessments.

“Hospitals are working in concert with community partners to focus on wellness and chronic care management as part of slowing health care cost growth. We are making important progress as these budgets suggest, while fostering one of the strongest health care systems in the country.”

The 2017 edition of the Commonwealth Fund Scorecard on State Health System Performance ranked Vermont’s health care system number one overall, evaluating health care access, quality, avoidable hospital use and costs, health outcomes, and health care equity. 

To learn more about the hospitals budgets and to review individual submissions, visit: http://gmcboard.vermont.gov/content/fy-2018-hospital-budget