Editor’s note: This commentary is by Timothy E. Nulty and Leslie Nulty of Jericho Center. It was submitted as an open comment to the Green Mountain Care Board.
[T]o the Green Mountain Care Board:
The citizens of Vermont look to you to pursue the goal of reducing the burden of health care costs on their wallets and the economy as a whole. We had welcomed the creation of the GMCB and looked to it as an entity that could keep the health care sector “honest.” It is therefore deeply disturbing that you have refused to look into the details of UVM Medical Center’s expenditures and its proposed budget, particularly in light of its current labor relations dispute with its nurses. Your posture in this matter amounts to dereliction of your duty and failure to fulfill your mandate and purpose — thereby endorsing and reinforcing bad decision-making by current UVMMC management. In effect, by declining to exercise your responsibility in this area, you have put your thumb on the scale to the disadvantage of both the UVMMC nurses and the Vermont community that depends on UVMMC hospital. This has serious implications for patient care and for the escalation of health care spending in the state. It also calls into question the very purpose and use of the GMCB’s own existence.
In particular, the Vermont community knows the following:
• UVMMC management has amassed a reserve fund enabling it to operate without any source of revenue for more than 250 days. This can constitute a “war chest” in its dispute with the nurses, and has no other apparent purpose.
• The top executives at UVMMC have enjoyed double digit pay and bonus increases over the past 10 years.
• The same is true for a small group (100 or so) of senior physicians
• UVMMC has spent millions on a “re-branding” and advertising campaign — an exercise that serves no apparent purpose in the delivery of affordable health care
• Nurses have had their compensation rise by (much) less than the rate of inflation — not to mention far less than senior managers and physicians
• The hospital has spent millions acquiring hospitals outside of Vermont
• The hospital has violated your own prohibition on subsidizing operations at those hospitals from revenue earned at UVMMC
• Nurses in those hospitals are paid more than UVMMC nurses — largely in areas where the cost of living is actually lower than the Burlington area where most UVMMC nurses live
• The hospital spends inordinate amounts of funds on higher-cost travel nurses, rather than improving pay and conditions in Burlington sufficient to reduce turnover
• UVMMC has spent millions on new real-estate acquisitions
In the face of these facts, for the GMCB to decline to question UVMMC’s policies and practices on the grounds that doing so would be “micro-managing” is actually insulting to the Vermont community. How else does GMCB imagine that it can fulfill its oversight duty except by examining the details of UVMMC financial management?
All of these known management decisions suggest that a thorough examination of financial management at the hospital could well uncover even more unbalanced redistribution of resources away from the core mission of UVMMC: patient care. This should constitute a more than sufficient basis for you to reject the hospital’s budget proposal and for taking a more active role in guiding management in a more constructive direction.
Should the GMCB continue to refuse to undertake serious examination and analysis of UVMMC financial decision-making, it may be time for another entity, perhaps the Legislature, perhaps the State Auditor, and perhaps both, to investigate GMCB.
