[A]n effort to regulate independent surgery centers is moving forward in the Legislature, but lawmakers have dropped two controversial provisions that could have imposed substantial costs on those facilities.
The House Health Care Committee‘s version of S.73, which would establish a state licensing structure for ambulatory surgical centers, does not include a provider tax or Green Mountain Care Board budget regulation. Both proposals had spurred concern from surgery center administrators.
However, the bill does say the care board must “collect and review” a variety of information from ambulatory surgical centers. And it contains several other new provisions, including a requirement that the centers accept Medicare and Medicaid patients.
The Health Care Committee tried to find the right balance in imposing such regulations, said Rep. Anne Donahue, R-Northfield and the committee’s vice chair.
“We had the dual concern … of not wanting to obstruct the benefits that they bring to consumers, but at the same time not leaving them free and open to do whatever in a health care system in Vermont that we’re really trying to pull together in a unified way,” Donahue said.
The development of Vermont’s second ambulatory surgery center, the soon-to-be-opened Green Mountain Surgery Center in Colchester, has been accompanied by efforts in the state Legislature to license and oversee such facilities.
A study group reported that all but two states – Vermont and Wisconsin – regulate ambulatory surgical centers in some way.
Figuring out the best way to do that in Vermont hasn’t been easy. A bill proposed in the Senate last year died after surgery center leaders said its provisions were onerous and treated the independent facilities too much like hospitals, though they are much smaller.
An earlier version of S.73 this year appeared to offer a compromise. But House Health Care members sought to expand that bill’s reach by considering a number of new provisions including a provider tax and care board budget review.
Both are issues that arose in last year’s debate. But Rep. Bill Lippert, D-Hinesburg and the committee’s chair, noted that the committee did not participate in previous discussions of surgery center regulation.
“It is our responsibility to do due diligence around these issues,” Lippert said.
The committee heard protests from both of Vermont’s surgery centers.
Dr. Katherine Lane, one of the owners of the Eye Surgery Center in South Burlington, said the committee was considering regulations that went far beyond those recommended by the legislatively commissioned work group that convened last year.
“We don’t feel these new provisions will serve the interest of Vermonters, as they will not improve patient care or reduce costs,” Lane told lawmakers.
Since for-profit surgery centers have tax obligations that nonprofit hospitals don’t, Lane said the Legislature shouldn’t “create a double standard and double tax the already vulnerable community of independent physicians that are already offering tremendous value to Vermont health care.”
She also said annual Green Mountain Care Board reviews of surgery center budgets – as the board does for hospitals – “will kill our operational efficiency” through “onerous reporting requirements.”
Another owner of the eye center, Dr. Greg McCormick, told the committee that comparing the center to a hospital “doesn’t actually make sense.”
“We don’t have one single full-time administrator at our ambulatory surgery center, to give you a sense of our size,” McCormick said. “Our managers are working nurses that are actively taking care of patients in addition to managing.”
Amy Cooper, manager of the Green Mountain Surgery Center, said there are “only a handful” of states that impose provider taxes on ambulatory surgical centers. And at the 6% rate considered by the committee, the tax could amount to a few hundred thousand dollars, Cooper said.
“This would really be a nonstarter in terms of us being able to get off the ground,” Cooper said.
Even before hearing from the surgery centers, the Health Care Committee had begun to shift some of its proposals. Full budget review before the Green Mountain Care Board was deemed unnecessary, as committee members “started recognizing and feeling that would be going too far in the direction of making these centers not even able to be sustainable,” Donahue said.
The provider tax also went by the wayside, in part because it’s not easy to create such a levy. Lawmakers said they don’t have time in the waning days of the 2019 session to adequately vet the issue.
“It was too big a piece to resolve at this point,” Donahue said. “By not adopting it now, it does not preclude (the Legislature) in any way from bringing it back up at a later point.”
The committee did add several provisions to S.73 including a requirement that surgery centers be certified by the Centers for Medicare & Medicaid Services. Surgical centers also should be required to maintain a transport agreement with an emergency medical service provider, and they should have a “publicly accessible policy for providing charity care to eligible patients,” lawmakers decided.
Green Mountain Care Board oversight also is in the committee’s version of S.73. The board must review data that could include information on a surgical center’s “scope of services, volume, utilization, payer mix, quality, coordination with other aspects of the health care system and financial condition,” the bill says.
The board’s oversight “shall be appropriate to ambulatory surgical centers’ scale and their role in Vermont’s health care system,” the bill says.
The care board also would be required to report to the Legislature annually on issues including “a comparison of the commercial insurance rates paid for the same surgeries and procedures performed in ambulatory surgical centers and in hospitals in Vermont.”
There’s no mention of allowing the care board to bill ambulatory surgical centers to cover the costs of regulation. The committee decided that such “billback” authority was unnecessary, Donahue said.
After the committee’s revision of S.73, Cooper said legislators “did a great job trying to understand a very complicated issue in a short amount of time.”
However, Cooper still is looking for further clarity. She said she is “concerned that the language around the (care board) collecting and reviewing information from (surgery centers) is too vague, and it’s hard to understand what that means exactly.”
S.73 currently is in the House Ways and Means Committee.
