Walter Carpenter, reporting from Peoples' Team on Senate Health Committee hearing Friday, Feb. 19th

It took some time to get the quorum together. Senators Racine, Kittel, Lyons, and Flanagan were there. Senators Matt Choates (D-Caledonia) and Kevin Mullen (R-Republican) were absent. Choates, a nurse, was working Pages constantly came in and out as the proceedings went on, bringing gift boxes and letters to the legislators. Walter Carpenter and Jerry Kilcourse, from the Worker's Center were there. Kate Kanelstein and other people from the center came in, but left shortly afterward. Jerry and Walter stayed the entire meeting, as did Dr. Deb Richter.

Deb concerned about outline presented by Jim Hester. Called her presentation the “Cart before the horse.” Fundamental problem the absence of efficient financing and cost containment in health care. Health care is unaffordable to Vermonters. Financing is now facing a disaster.

Summary: . Outline represents efforts of the 30 to 40 years of duct tape on attempts at hospital reform that have not worked. Despite all efforts, hospitals have an administrative obesity, that health care is out of control, and Deb wondered if hospital CEO's are worth their million dollar salaries if they cannot reduce these costs. We have done incremental steps, but avoiding “the horse,” avoiding the real change that is necessary. There was debate on ACO's “accountable care organizations.” Racine had problems with global budgets, with savings going back into the executive bonuses. ACO popped up as similar to Canadian-style regional models. Deb asked for clarification on whether ACO's mean global budgeting. Racine said that the “concept is out there.” Deb said that ACO's have not yet been tested. None of studies have shown that these reduce overall health care spending.

Part III: Deb is becoming hopeful. Likes way plan is coming together. Likes move away from employer based to single payer. Seems like it is a plan to study, versus a plan to implement. Racine said that outline is similar to S.88, which is plan to implement, while someone else out there figures out how to do it. Deb said that we need an architect to design the program, recommended Dr. Hsiao (spelling). Deb said that costs under Taiwan system, designed by Dr. Hsiao, costs went up, but then dropped, and are now paying some 6% of their GDP, with uniform reimbursement rates pre-negotiated, where costs are significantly lower. Racine said outline is a plan to get something going this year.

Second Part of Testimony: Global Budgeting and Global Payment.

Jim Hester, Head of Health Care Reform: End of year there is a settlement, a reconciliation. It is a shared saving, use that pool. He described favorable and unfavorable incentives, told how patients are a form of cost in global budgets, and a global payment system, under served rather than over served, and under global payment providers cannot earn financial rewards for services. Senator Lyons asked about why do we do a pilot program for global budgeting and global payments. Hester was reluctant to do it because that Vermont hospitals do not currently have capacity to deal with global budgets.

Nothing set on.