BURLINGTON, Vt. (WCAX) – Health care regulators have given the greenlight to millions of dollars in new hospital spending. Across Vermont’s 14 hospitals, the Green Mountain Care Board approved $155 million in new spending, a 4.1% increase over last year.
Every year, regulators have to approve hospital budgets, balancing access, quality and affordability. Really since the pandemic, the cost of health care has skyrocketed.
“This year more than ever the challenge of balancing affordability and sustainability was as difficult as ever,” said Owen Foster, the chair of the Green Mountain Care Board.
Health care regulators gave the greenlight to bigger hospital budgets, increasing by about 4%– about half as much as what hospitals requested.
The spike in spending was driven by inflation, the cost of traveling nurses, executive salaries, prescription drugs and more.
“We’re in a situation where there aren’t many additional health care dollars to devote. We’re seeing school budgets strained because of health care costs and state budgets strained because of health care costs,” Foster said.
When hospital budgets go up, Vermont businesses and consumers pay the price through health insurance premiums and out-of-pocket expenses. Health care continues to be a major concern for affordability.
“We have an aging population. We’ve seen increased demand or pressure on access and increased acuity so it’s quite a balancing act,” said Mike Del Trecco of the Vermont Association of Hospitals and Health Systems.
But this year, two hospitals were dinged for making too much money. Regulators say the UVM Medical Center and Rutland Regional Medical Center exceeded a revenue cap and will allow commercial insurance companies to pay the hospitals less.
In a statement to WCAX News, UVM said despite taking in more patients to reduce wait times, they did not make a profit.
The UVM Health Network’s overall operating margin for FY23 was 0.1%, far below the threshold considered healthy for a nonprofit hospital to continue investing in its people, equipment and facilities to provide high-quality, cutting-edge care.
The state is taking a number of steps to bring down the cost of care, including shifting how it’s paid for and taking a hard look at the physical footprint.
But all parties agree — creating more housing and growing our workforce is a key way to bring down the cost of care.
“Unless we address demographics and housing, we will continue to see difficulties in health care, as well,” Foster said.
“I think there’s many sectors of a flat economy that impacts many sectors of Vermont,” Del Trecco said.
Regulators say part of that is making sure our health care system and the services provided are efficient.
This Wednesday, a consultant is expected to give a key report on what the future of our health care system should look like and how to make it sustainable.