Oversight Commission examines long-term spending

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(Host) A state commission is looking for new ways to control rising health care costs. Last month, the Public Oversight Commission recommended only minor cuts in budgets for two of Vermont’s 14 hospitals. The panel will now examine whether there’s a better system to curb hospital spending.

VPR’s John Dillon reports.

(Dillon) When the Public Oversight Commission finished its work last month, it recommended $3.5 million in cuts for hospital budgets. The panel’s recommendations aren’t final. Banking and Insurance Commissioner Betsy Costle must decide by Monday whether to accept the recommendations.

Some on the Oversight Commission feel frustrated. Chairman David Yacovone says there has to be a better way to control the double-digit budget increases.

(Yacovone) “The complexity and the enormity of the hospitals budgets can be overwhelming. And there’s some discomfort on folks’ part to drill down into the details in areas where they may not be conversant in. And nobody wants to impact adversely on the quality of care. On the other hand, everyone agrees that some type of oversight is needed as a check and balance on restraining spending.”

(Dillon) Yacovone wants the Commission to get together in October for a discussion with hospitals, consumers and payers like insurance companies.

The panel will work on recommendations for the next governor and legislature. He says one idea is to set an overall spending cap for all 14 hospitals and ask the institutions to work within those limits.

(Yacovone) “What I’m suggesting is that we look at the system and say [that] the hospital system, the billion dollar hospital system, in any one year should not exceed a certain dollar amount of new debt or new capital expenditures which would drive costs in the future. And then instead of looking hospital by hospital, looking at what does the system need to be strong. It’s taking a global look and setting a cap on the capital expenditures because there are limited resources.”

(Dillon) Hospital budgets have climbed steadily over the last decade and now total a combined one and a half billion dollars. This year’s increases alone averaged 9.5%. Yacovone says he hopes to begin the discussion on hospital spending by mid-October.

For Vermont Public Radio, I’m John Dillon.

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