Citing more than $110 million in inflation-related costs, the state’s largest health network is asking Vermont regulators for double-digit increases to private insurance service charges in the next fiscal year.
If regulators at the Green Mountain Care Board approve the University of Vermont Health Network’s budget request in full, consumers with private insurance could see drastic increases in their premiums next year.
“There is no question this is the most challenged financial position we have experienced in my 20 years in health care,” Rick Vincent, the health network’s chief financial officer, said in a written statement Friday.
The network is asking regulators for a 19.9% increase in charges for University of Vermont Medical Center, a 14.52% increase for Central Vermont Medical Center and an 11.45% increase for Porter Hospital, according to a press release issued Friday.
Network officials also said its three Vermont hospitals have undergone a series of “financial improvement measures” that produced some $50 million in cost cuts. Despite these efforts, officials said in the press release, “there will still be gaps.” The increase in commercial rates should generate a “modest” margin for the network, which, according to the announcement, is important for the network’s long-term sustainability.
Some of these improvement measures, according to the release, include making better use of surgical and patient bed capacity, investing in nurse retention initiatives and expanding the network’s pharmacy services.
Earlier this spring, the health network sought from regulators a mid-year budget adjustment to address a $44 million budget deficit. Another hospital, Rutland Regional, sought an increase to address a more than $7 million shortfall. Regulators granted the health network a $14 million increase, but denied Rutland’s request. Green Mountain Care Board members told officials from both hospitals that substantial hikes should be discussed during the annual budget cycle, slated to begin this summer.
In its request last year, UVM Health Network cited increases associated with a greater reliance on costly temporary staff through the pandemic.
The board set the stage for higher rates earlier this year when it voted to approve a rate-increase ceiling of 8.6% over the next two fiscal years. That’s higher than the usual 3.5% growth rate hospitals are granted each year.
UVM Health Network’s press release did not include the total anticipated budget for fiscal year 2023, which runs October 1, 2022 to September 30, 2023. Hospitals are required to submit their full applications to the care board by the end of the day Friday, but the applications are not yet public.
The health network is expected to hold a press briefing to discuss its rate request Friday afternoon.
This story will be updated.
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UVM Health Network requests double-digit rate increase, citing inflation and pandemic pressures - vtdigger.org
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