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Vermont Week

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Committees Briefed, At Length, On Mental Health Options

Five psychiatric experts testified Wednesday before a joint meeting of the Senate Committee on Health and Welfare and the House Committee on Human Services about the daunting and complex task of rebuilding the mental health system in Vermont after the loss of its main treatment facility for acute mental health care, the Vermont State Hospital in Waterbury.

The testimony came a day after a draft bill was issued in the Statehouse by the Human Services Committee that puts some dollars and cents and programs and buildings together into a comprehensive, if still incomplete, package.

Psychiatrist Dan Fisher strongly advocated for a system that relies on community treatment and very little on involuntary hospitalization, saying "hospitalization may at times be necessary but it should be the absolute last resort."

But other experts who testified Wednesday were more cautious about Vermont's ability to reduce the number of acute care beds in the system, saying Vermont already has one of the lowest hospitalization rates in the nation and that some patients who are violent, aggressive and dangerous or in the criminal system will need a secure place to be treated.

"It's important that Vermont recognize that it will be going someplace no state has gone before it," said Dr. Jeff Geller of the UMass Medical School department of psychiatry, adding "it's not a reason not to do it, or do it." Vermont had the fifth lowest mental health hospitalization rate in the country and it will take "very great investments" in community treatment to replace the need for acute care beds, he said.

The issue of how many acute care beds are needed to replace the Waterbury State Hospital remains the elephant in the mental health room for lawmakers and advocates alike, and the experts danced around that question.

Dr. Howard Goldman, a professor of psychiatry at the University of Maryland, said evidence is "pretty strong" that community treatment models work and can reduce need for hospitalization. But as to how many state hospital replacement beds Vermont will end up needing, he said, "that's an extremely difficult question." The concern is that in an effort to reduce hospitalizations, the state can eventually end up not providing "a good quality of care," he said.

"I think every community needs to have some acute resources," he said.

Fisher estimated if Vermont's proposed community system used all the newest treatment models, that number could be 20-25.

The administration's proposal calls for 36 acute care beds to replace the state hospital, spread out at three facilities: 14 at the Brattleboro Retreat ready as early as July; six at the Rutland Regional Medical Center as early as fall; and a new 16-bed facility to be located near Central Vermont Medical Center in the future. Acute care is now also being provided at Fletcher Allen in Burlington but that is not part of the long-term plan.

The proposal also calls for greatly expand community services, from emergency intervention, housing, crisis beds, peer services and intensive local mental health outpatient and residential services that administration officials say will preempt the need for more acute care beds.

-- Andrew Nemethy

Lawmakers Press Green Mountain Care Board On Work Plan

The Shumlin administration and the Green Mountain Care Board introduced road maps Thursday for how they plan to implement health care reform.

The board's annual report and the administration's Strategic Plan for Vermont Health Reform shed light on the specifics of how the state will maneuver to a health benefits exchange in 2014 and into a single-payer system in 2017.

Anya Rader Wallack, chair of the Green Mountain Care Board, fielded questions from legislators Thursday that have become somewhat of the norm: How will the board maintain its independence from the Shumlin administration and how is a reformed system going to control costs?

Sen. Kevin Mullin, R-Rutland, pushed both Wallack and Director of Health Care Reform Robin Lunge on the issue of containing costs through tort reform. A report by Harvard economics professor Dr. William Hsiao last February recommended moving to a no-fault medical malpractice system similar to New Zealand. Act 48, last year's health care reform law, requires a report to the legislature on the costs of reform. It was due this week, but the administration requested an extension until Jan. 30.

The board's work plan includes a plethora of tasks for analyzing data for evaluating quality and performance in the health care system, implementing pilot payment programs, and dealing with a host of issues involving insurance rate review and hospital budget oversight.

The annual report also outlines the board's estimated expenditures, which total around $2.1 million for 2012 and nearly $2.5 million for 2013.

With somewhat of an overlap between the administration's mandate to implement a health benefits exchange dovetailing with the Green Mountain Care Board's mandate to lay the groundwork for a universal health care system, Rep. Chris Pearson, P-Burlington, said he was concerned people are becoming confused and losing sight of the ultimate goal of single payer.

"We've really got to keep our eye on the prize," Pearson said.

The focus on a health benefits exchange, which is a federal mandate, has become a point of frustration, he said.

"People are deeply interested in seeing a real health care system that is effective, and there's a lot of anxiety about that," Pearson said. "It's all geared to this goal, but we can't talk about it in a way the public understands if we're not talking about the goal. Nobody is mentioning Green Mountain Care."

The exchange is a step toward single payer, however, and transforming health care involves lots of moving parts.

"Just focusing on single payer and saying that's going to be the silver bullet would be very naïve," Wallack said.

--Alan Panebaker

Vermont Tops List Of High-risk Embezzlement States

Vermont often makes it onto national top 10 lists. But being first among the states at high risk for embezzlement isn't the kind of publicity any place wants.

Nevertheless, in an annual study of major U.S. embezzlement cases released on Jan. 17, Vermont topped the list, followed by Connecticut, Pennsylvania, Montana, Virginia, Iowa and Idaho.

Marquet International, a consulting firm that works with corporate clients to assess opportunities and reduce risks, examined 473 major cases active in 2011 involving more than $100,000 in losses.

Like its previous reports, Marquet's 2011 study of white collar fraud attempts to identify the key trends. A weak economy is not the only driver, it concludes. The data suggests instead that "there is always an ambient level of corporate fraud - often driven by individuals seeking to maintain a lifestyle grander than what they could otherwise enjoy who have rationalized their actions. "

This isn't the first year Vermont has demonstrated a high "Embezzlement Propensity Factor," the measurement developed by Marquet to capture the percent of gross losses due to embezzlement for a state and the percentage of its economic output to overall GDP. Along with Oklahoma and New York, Vermont has been among the top ten for three of the last four years.

"Certain states like Vermont are consistently among the highest risk for loss due to embezzlement," explains CEO Christopher Marquet. "Anyone in that state that keeps up on the news knows that Vermont has experienced a rash of high profile embezzlements in recent years."

Why has Vermont experienced so much embezzlement over the last four years? One possible reason, according to Marquet, is that residents are just too trusting. "Maybe there is something to that theory," Marquet says. "Vermont is a place, after all, where people don't bother to lock their doors that often."

Another factor may be that the state has few large businesses. Smaller operations tend to have weaker business controls, thus increasing the opportunities for theft. Although the financial services industry experienced the biggest losses last year, nonprofits and religious organizations accounted for about a sixth of the embezzlement incidents.

The Marquet report notes that 64 percent of the embezzlers in their study were woman, accounting for 59 percent of total losses. However, women tend to steal less than men. The average loss from male embezzlers was $863,713, compared with $693,970 for women.

The typical perpetrator last year was 47 years old and tended to work alone. Men were nearly twice as likely to participate in a conspiracy and use unauthorized electronic transfers, and were three times as likely to engage in vendor fraud. If the incident involved payroll fraud, however, women were more apt to be the perpetrators.

-- Greg Guma

Shumlin Administration Unveils Health Care "Exchange" Legislation

Legislation introduced Tuesday could lay the groundwork for the first phase of substantive health care reform in Vermont as the state inches toward universal health care.

Rep. Mike Fisher, D-Lincoln, and Rep. Ann Pugh, D-South Burlington, introduced H.559, legislation from the Shumlin administration that would set out the ground rules for a health benefits exchange that the state is required to put into effect in 2014.

The two controversial aspects of the legislation include a requirement that small employers only buy insurance through the exchange. In addition, the definition of a small business under the Shumlin administration plan would be a company with 100 or fewer employees.

Last year, Anya Rader Wallack, then a special assistant to the governor, pushed for one insurer in the exchange. Act 48 was amended to include one or more, but critics have alleged that the exchange would likely only include two insurers. The state currently has three health insurance companies.

-- Alan Panebaker

Economists Say Vermont's Tax Revenues Are Sliding

Vermont's economic recovery from the Great Recession has hit the pause button. Over the next 18 months, the economy will stall and the state will see a slight dip in tax receipts, according to two economists who advise the Shumlin administration and the Legislature.

Though the economy will continue to improve slowly, housing sales will be soft and employers will remain cagey about hiring in the coming year, according to Jeffrey Carr, an economist who advises the Shumlin administration, and Tom Kavet, the consulting economist for the Legislature.

Meanwhile state budget-writers will need to sharpen their pencils again to make up for the estimated decline in projected revenues for the General Fund. Tax receipts will continue to improve, but lag by 0.2 percent, or $1.8 million, over the next six months, and then drop about 0.7 percent, or $9.3 million, in fiscal year 2013, from the previous projections. The state will need to find about $12 million to cover the shortfalls. Overall, total tax income is expected to grow by $68 million in 2013 over fiscal year 2012 revenues.

Carr and Kavet said the uncertainty that has clouded the 2012 and 2013 fiscal forecasts comes on top of a very volatile 2011 in which the global economy contended with high energy prices, the tsunami in Japan that disrupted auto manufacturing and other markets, the debt ceiling fight in Congress and now the European debt, currency and banking crises.

So far it looks like the plateau in economic growth is not going to lead to another cliff, or double dip, instead they said the recovery would be flat for the next 18 months as the nation's economy slowly returns to normal growth patterns.

"When we consider how far and how long we were down, it's really been a tepid recovery," Carr told Gov. Peter Shumlin and the chairs of Senate Finance, Senate Appropriations, House Ways and Means and House Appropriations.

Compared with other states, Vermont is doing "relatively well," according to Kavet. The unemployment rate is fifth lowest in the nation, and Vermont homes have retained their value better than the rest of the region.

Gov. Peter Shumlin emphasized that the dip in tax receipts amounts to seven-tenths of 1 percent. Overall, revenues have improved, he said.

"We have a $1.3 billion General Fund budget," Shumlin said. "We are talking about having revenues down by about $9 million over what might have been projected, but we're up $68.5 million over last year, so this is a good news story. We're on track in a very fragile recovery and if we can keep passing legislation in this building that balances the budget without raising taxes on struggling Vermonters, we're going to see, I believe, a steady continuous recovery in Vermont that's going to grow jobs and economic opportunities."

-- Anne Galloway

Permit Fees Would Go Up Under Shumlin Administration Proposal

The Shumlin administration has proposed a $3.16 million increase in environmental permitting fees as part of the fiscal year 2013 budget.

Under the plan, Entergy Corp., the owner of Vermont Yankee Nuclear Power Plant in Vernon, would pay $543,000, or $333,000 more for its wastewater discharge permit.

IBM would see a $2,500 increase in its air quality control permit and would pay a total of $15,000, if the so-called "fee bill" is approved by the Legislature.

Most of the price increases for air and water quality permits range from $14 to around $500. The proposed price schedule includes new fees for potable water supply and wastewater permits.

David Mears, commissioner of the Department of Environmental Conservation, told lawmakers on Jan. 13 that the increases are necessary because the federal government plans to cut funding for state grants by 10 percent over the next three years.

"Instead of cutting their own operations as they've been cut, the Environmental Protection Agency is passing the cuts on to the states," Mears said.

There has been no appreciable increase in fees in at least five years, Mears said in testimony before the House Ways and Means Committee.

Members of the powerful House tax committee asked the commissioner what businesses get for the fee. "They get a permit," Mears quipped.

Fees are used to pay for state monitoring of federal pollution requirements. Before the Clean Air Act and the Clean Water Act became law in the 1970s there were no pollution controls on companies. After the legislation was enacted, the federal government authorized states to create programs that would demonstrate water quality and ambient air quality. For the first time, toxic chemicals, such as sulfur dioxide and nitrogen oxide, came under the purview of state and federal governments.

The Department of Motor Vehicles is also seeking to raise fees. Brian Searles, secretary of the Agency of Transportation, said the total proposed license, registration and title fee increase of $6.3 million is a consumer price index adjustment.

-- Anne Galloway


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