Auditor Doug Hoffer says regulators should do more to control health care costs

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Posted on October 18, 2020 in In The News, News
Doug Hoffer
Vermont State Auditor of Accounts Doug Hoffer at his office in Montpelier last August. Photo by Glenn Russell/VTDigger 

State health care regulators are making decisions without taking into account whether Vermonters can afford the health care they need, according to Auditor Doug Hoffer.

The Green Mountain Care Board has no “clear and direct consideration of Vermonters’ ability to pay for health care,” according to a memo released Tuesday by the State Auditor’s Office. Hoffer called the omission “a troubling trend” in the state’s approach to regulating and overseeing health care.

The five-member Care Board oversees hospital budgets, insurance rates, and the state’s efforts to change the way health care is funded with the all-payer model.

Vermont has some of the most stringent health care regulation in the country, but costs continue to rise. “That has real impact for people on the ground, both for families who get insurance on the [state health insurance] exchange, for employers, for school boards who have to raise taxes, it just goes on and on,” Hoffer said in an interview.

Kevin Mullin, the chair, called the accusation that the board board doesn’t consider cost “nonsense.” Health care costs are too high, he acknowledged, but the board has an at-times contradictory mandate to keep hospitals afloat.

Mullin criticized Hoffer for “just wasting taxpayer dollars because we spend so much time complying with all his requests.”

Vermont has one of the highest health care costs per capita in the country at more than $9,000 per person. An August report from Hoffer showed that the state’s costs for care had risen more quickly than the U.S. as a whole. Between 2000 and 2018, health care spending in Vermont rose by 167%, more than any other New England state.

“This problem appears to stem in part from convoluted systems and powerful institutions – not from the people who provide direct health care services,” Hoffer wrote in the report’s introduction.

In the recent memo, the State Auditor’s Office recommended that the board consider Vermonters’ ability to pay when regulating hospital budgets, health insurance rates, and cost targets for the all-payer model. Hoffer also suggested that the board use affordability metrics in the board’s analyses it shares with the public.

The board does consider cost, but uses different metrics to measure it, aiming to cap growth at 3.5% a year. That increase is meant to line up with the average growth in gross state product. But Vermonters’ wages haven’t risen as quickly as the gross state product, Hoffer argued.

Both hospital spending and health insurance costs have increased at higher rates than Vermont’s median hourly wage, according to the report.

The board “has neither defined the criteria for affordability nor developed affordability measures to use in their decision-making processes that are specifically linked to Vermonters’ ability to pay for health care,” it read.

Kevin Mullin
Kevin Mullin, chair of the Green Mountain Care Board, discusses the board’s annual report in January 2019. Photo by Glenn Russell/VTDigger 

Hoffer has repeatedly criticized the Green Mountain Care Board. In July, he published a report critiquing the board’s oversight of OneCare, the entity overseeing the all-pay model. In August, the auditor’s office came out with a memo that said the board hadn’t done enough to control cost.

He and Mullin have repeatedly traded barbs over the reports.

Hoffer’s suggestions “weren’t helpful,” Mullin said. “If you listen to the people we regulate, they say we’ve cut [rates] too much. Other people say we haven’t cut them enough,” he added. “We try to balance both sides.”

Hoffer said he believes Mullin is committed to reducing cost — he’s just not doing a good enough job.

“The Green Mountain Care Board is clearly charged with addressing affordability,” Hoffer said. “It’s clearly addressed in statute and rule. They’re not doing it.”

If Mullin thought the board’s mandate was too complex or broad, he should ask the Legislature to change the statutes or offer more resources, Hoffer said.

Hoffer also said he wasn’t going to back down on questioning the state’s health care costs. As a $6.2 billion industry in Vermont and a sixth of the state economy, “if I didn’t pay attention to health care, people would say what’s wrong with you,” he said.

Link to original article here –> https://vtdigger.org/2020/10/13/auditor-doug-hoffer-says-regulators-should-do-more-to-control-health-care-costs/

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