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Green Mountain Care Board Announces 2016 Hospital Budget Decisions

Montpelier, VT – After completing its review of Vermont’s hospitals’ budget requests for fiscal year 2016, the Green Mountain Care Board (GMCB) has set the total fiscal year 2016 budget increase for Vermont’s hospital system at 3.5%, including 0.5% that qualifies as investments in health reform. This marks the third year in a row that Vermont’s 14 hospitals as a group have kept net patient revenue increases at or below the target set by the GMCB.

In announcing their decisions regarding hospital budgets for Fiscal Year 2016, the Green Mountain Care Board approved the Porter Hospital budget as submitted with no changes. Nine other hospitals’ budgets were approved as submitted and four were reduced by the GMCB.

PMC Board Chairperson, Maureen McLaughlin, responded to this news in an email to Porter’s new CEO, Lynn Boggs: “Congratulations to all. We appreciate all of your hard work, and know this result is well deserved,” she wrote.

In written guidance issued in March 2013 and reiterated this spring, the GMCB instructed hospitals to hold their FY16 net patient revenue increase to no more than 3 percent plus an allowance of up to an additional 0.6 percentage points for investments in health care reform initiatives. Net patient revenue includes payments hospitals receive from patients, government, and insurers to pay for patient care – but not revenues from other activities such as cafeterias, parking, and philanthropy.

Hospitals submitted budget requests in July, starting a two-month review process that included GMCB staff scrutiny of the budgets, open hearings with each hospital in August, a public comment period, input from the Office of the Health Care Advocate, and discussion in GMCB’s weekly open meetings.

The second key indicator of growth in hospital revenue is the “rate” – the increase in the price a hospital sets for services before negotiating with insurers. The GMCB approved rates ranging from -10.0 percent change to 6.0 percent change for individual Vermont hospitals in fiscal year 2016.