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Reporter debrief: State-appointed consultants propose eliminating beds, consolidating services as Vt. hospitals lose money

A sign in front of UVM Medical Center in Burlington.
Toby Talbot
/
Associated Press
At a meeting on Oct. 27, 2021, the Green Mountain Care Board heard from consultants about why Vermont's hospitals are losing money and possible ways to exact cost savings. Ideas to consolidate services or eliminate beds drew swift condemnation from the Vermont Association of Hospitals and Health Systems.

State regulators say that Vermont's hospital system is losing too much money and they want to see major changes to avoid another bankruptcy. At a meeting last week, the Green Mountain Care Board, for the first time, talked about eliminating beds and consolidating some services among the state's 14 hospitals in order to save money. Those suggestions drew swift condemnation from the Vermont Association of Hospitals and Health Systems.

VPR’s Henry Epp spoke with reporter Howard Wiess-Tisman, who covered the board's meeting on Oct. 27, 2021. Their conversation below has been edited and condensed for clarity.

Henry Epp: So first off, Howard, we should remember that Vermont has this regulatory body that approves all hospital budgets — it's called the Green Mountain Care Board. Why are they so worried about the hospital system right now?

Howard Weiss-Tisman: Yeah, so it kind of goes back to June of 2019. That's when Springfield Hospital declared bankruptcy. And that was a real wake up call for everybody.

So, the Green Mountain Care Board took a step back, and they looked at the finances of all of Vermont's hospitals, and they saw a lot of troubling trends -- that the operating margin was going down every year. They actually found that about half of the hospitals were losing money.

More from VPR: Green Mountain Care Board Pushes Sustainability As Rural Hospitals Struggle

This is happening across the country. Since 2005, about 180 rural hospitals declared bankruptcy. So, the board, before the pandemic, they started doing what they're calling sustainability planning. And they're trying to look at a long-term solution to this. That kind of all got sidelined by the pandemic, and now the board is getting back to it.

OK. And so, the board met last week, and they heard from a few consultants that they hired to come up with ideas for hospital sustainability. So, what were some of the things those consultants talked about?

Well, they got two different reports. And the first consultant, they really looked at why the hospitals are losing money — and this stuff gets into eye glaze territory pretty quickly.

So, one of the big issues is that Vermont is aging. And as more and more people go on Medicare, it means the federal government, they pay less for medical procedures than insurance, the insurance that you and I and anyone who's lucky to have it has. So, as more Vermonters are aging and going on these federal programs, the hospital's costs go up and salaries go up. And the only way for them to kind of makeup that difference is to continue raising insurance rates. We've all seen that.

And then there was a second report, and this really gave a detailed look at our hospital system. The consultant looked at the number of beds in each hospital, and how often they were used, and the drive time between hospitals.

And it's important to point out here that these are just ideas right now, they're not even proposals and the Green Mountain Care Board, they haven't taken any action yet.

But the report was really pretty radical. They talked about things like shutting down the inpatient departments at Grace Cottage Hospital in Townshend and moving those beds to Brattleboro. And doing the same thing in Springfield and moving the beds to Mt. Ascutney.

They talked about moving the intensive care units from hospitals in St. Albans, Newport and Randolph, to some of the nearby larger hospitals. And there's this idea that when hospitals only do a handful of procedures a year that the outcomes are just not that good. And so, for things like hip and knee replacement, the consultants were saying that there should be what they're calling Centers of Excellence for that. Most of those operations would happen at UVM, or Dartmouth. And all the smaller hospitals in that area would stop doing these procedures.

operating-expense-graph-greenmountaincareboard-courtesy-20211103.JPG
Green Mountain Care Board, Courtesy
A chart highlights some of the revenue challenges facing Vermont hospitals.

OK, so these proposals could really impact the communities that especially smaller hospitals serve. So, what do the hospitals think about this?

Well, they don't like it. I think the Green Mountain Care Board was really hoping that the hospital system would get on board and kind of see the same threatening headwinds that are out there. But the hospitals really are pushing back on this. Jeff Tieman is president of the Vermont Association of Hospitals and Health Systems. And he says, you know, when you float ideas like this, it's really not going to help the workforce issues that every hospital in the state is facing, and this is what he said:

“When our very powerful healthcare regulator speaks about excess hospital capacity, it sends a terrible and damaging signal to our healthcare heroes. What they could easily hear is that the Green Mountain Care Board is seriously considering highly controversial and unprocessed ideas that could change the units they work in. We need more workers right now, not less, and suggesting that the regulator may move where care is available or try to do that in any way is plainly dangerous when we're doing everything we can to preserve, not drive away our crucial workforce.”

More from VPR: As Losses Mount, Some Hospitals Request Steep Rate Increases

Tieman said that a lot of the data in the report was flawed. He promised to put out some counter numbers. And you know, at a time when wait times are up and COVID is really straining the whole hospital system, Tieman said this just isn't the time to talk about this.

Now one other thing that's really interesting is all of this started before COVID. And COVID, obviously, has impacted the hospital system so much. So, the Green Mountain Care Board had to go back to 2019 to look at data just because the hospital system has been so out of whack over the past couple of years. And Tieman says this just isn't a good time to be having this discussion, because no one really knows what our medical system is going to look like post COVID.

Finally, Howard, what's next in this process?

Well, like I said, the hospital system, they're digging in their heels. They're promising to show their data, which they say is going to show a different story. The Green Mountain Care Board has a report due to lawmakers in January. And as you said, the Green Mountain Care Board, they regulate the hospital budgets, but it's looking like they're going to look to the Legislature to kind of get between the hospitals and them and try to figure things out. As I said, they're calling this sustainability planning. The Green Mountain Care Board is just saying it just can't go on like this. The hospitals can't continue losing money. They say they don't want to shut down a hospital, but they say without some kind of plan, that's exactly what's going to happen. So, there's going to be a lot of action, I think, next year in Montpelier about this.

Have questions, comments or tips? Send us a message or get in touch with reporter Howard Weiss-Tisman @hweisstisman.

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