News Releases

September 16, 2009

Commissioner Limits Rate Increases for FY 2010 Vermont Hospital Budgets

Montpelier, VT -- Paulette J. Thabault, Commissioner of Banking, Insurance, Securities, and

Health Care Administration (BISHCA), announced that she has established the 2010 budgets for

Vermont hospitals. Part of the Department’s mission is to help ensure that all Vermonters have

access to affordable, quality health care. In keeping with that mission, the Legislature recently

reaffirmed BISHCA’s charge to oversee hospital budgets. Hospitals were asked to do their

utmost this year to limit costs to consumers and minimize the impact on insurance rates.

Commissioner Thabault said, “The budget approval process is always a careful balance of

concerns, but we know that hospital expenses make up roughly 40 of our health care costs, and

those costs directly fuel insurance premiums.” The hospitals testified about their budgets at

public hearings held over a three-day period before Commissioner Thabault and the Public

Oversight Commission (POC).

The Vermont hospital fiscal year for 2010 runs from October 1, 2009 through September 30,

2010. This year, hospitals requested an average 6.4 rate increase, although individual hospital

rate requests ranged from 4.0 to 8.8. The requests totaled an increase of $100.7 million in

operating revenues.

At this time, the Commissioner’s decisions result in a decrease from the requested 6.4 system

average rate increase to 5.9. This will reduce operating revenues by $5.9 million. The

Commissioner established the following rates for the FY 2010 hospital budgets:

Hospital Requested Rate Increase Revised Rate Increase

Brattleboro Memorial Hospital 8.8 7.1

Central Vermont Medical Center 8.0 6.8

Copley Hospital 6.0 6.0

Fletcher Allen Health Care 6.5 6.0

Gifford Medical Center 5.8 5.8

Carlos Otis Health Center 5.0 5.0

Mount Ascutney Hospital 6.1 6.1

North Country Hospital 4.0 4.0

Northeastern VT Regional Hospital 6.0 6.0

Northwestern Medical Center 6.5 5.2

Porter Medical Center 7.0 6.7

Rutland Regional Medical Center 6.5 5.5

Southwestern Vermont Medical Center 5.0 5.0

Springfield Hospital 6.7 6.1

The law requires that hospital budgets must be consistent with the Health Resource Allocation

Plan adopted by the Governor on July 1, 2009; must compare to appropriate national, in-state,

regional and peer group norms; must evidence efficient and economic operation of the hospital;

and must reflect budget performance in prior years. The Commissioner considered the

comments of the Public Oversight Commission and also evaluated the following factors:

Department targets for inflation and utilization increases, the numerous changes occurring in

government and insurance reimbursement, pressures in the overall economy, hospital physician

acquisitions, the challenges associated with recruiting medical professionals to Vermont, hospital

investments in information technology, the need for operating margins, a hospital’s budget

performance in prior years, price, quality and patient satisfaction information, and the unique

circumstances of each hospital.

For more information, call Mike Davis at the Division of Health Care Administration:

802-828-2989

Source: Banking, Insurance, Securities Health Care Administration
Last Updated at: September 16, 2009 09:51:12