This commentary is by Lucas Farrell, a farmer and writer in Townshend. He is the treasurer of the board of Grace Cottage Family Health and Hospital. These views are his own.
Defenders of Brattleboro Memorial Hospital’s birthing center need to say this out loud, because our case is worthless without it: The hospital’s finances were catastrophically mismanaged, and the community deserves to be angry.
The record is in BMH’s own filings: nine years of losses — $33.6 million since 2017 — plus bond default, provider-tax arrears, reserves drained for payroll. Its own audit found “all internal and external reporting was unhelpful and inaccurate in most cases.” The audit that finally measured it quadrupled the known shortfall.
I’m a neighboring hospital board’s treasurer, with no patience for excusing this and no interest in rescues rewarding it. The physicians now leading BMH sat on that board through those years; to their credit, they stepped into the vacuum, named the failures and spent 10 months cleaning up. The cleanup is real; the record is still the record.
But a birthing center will close Dec. 31 on a logical error: “They mismanaged” and “the state shouldn’t pay” run together as if one followed from the other. It doesn’t.
Mismanagement explains BMH’s larger hole, but not why the birthing center loses money. Small obstetric units have brutal economics, even when competently run: They’re staffed around the clock whether one baby comes or five. Medicaid covers roughly 40% of BMH’s births and, leaders testified, hasn’t raised rates in five or six years, “and it was woefully inadequate then.” BMH sees perhaps $500,000 in improvements; a $4.5 million annual subsidy remains. Asked about negotiating higher rates, its consultant called extracting $20,000 more per birth from insurers “an insane negotiation.”
Brattleboro isn’t alone. Northwestern Medical Center in St. Albans stabilized its birth center’s staffing; it remains the largest money-loser, at $3.25 million a year. An obstetrician who helped save it put it plainly: “If Medicaid doesn’t come up on their obstetrical fees, I don’t exactly know how this is going to work.”
New Hampshire answered her: When maternity care reached this cliff in the north country, it amended its Medicaid rules. Coos County hospitals are paid for labor and delivery “as a separate peer group at an enhanced rate,” a 300% multiplier, for one federally approved reason: access. A category, a multiplier — and that county’s last delivery room is open today.
Vermont needn’t copy the number, but it can do something less controversial: Run it. Show us what 200%, 250% and 300% multipliers do. Publish the payment, the remaining deficit and the state’s share.
Vermont would also receive more federal help paying for this than New Hampshire did. The federal government covers 57.76% of Vermont’s Medicaid costs next year, compared with just 50% for New Hampshire — so for every extra dollar Vermont spent raising reimbursement rates, Washington would cover about 58 cents of it. Maybe the state runs the numbers, and the cost still doesn’t pencil out. Fine — then say so, and show the math. But right now, nobody has.
At its budget hearing, BMH told regulators $3.8 million would carry the service for one more year; enough time, leaders said, for Vermont to fix reimbursement. The bridge has a price; the multiplier is its far side.
BMH is right about a second problem: workforce. The hospital has just one employed obstetrician and no pediatricians on staff. Leaders testified that a single gap in coverage can force the hospital to divert patients elsewhere. Money cannot deliver a baby, but finances and workforce are not separate problems. Compare the recruiting pitches: a service the hospital says it may close, or one Vermont has designated as essential infrastructure, durably reimbursed; these are different jobs to recruit for. A service everyone expects to die becomes hard to staff; the staffing trouble becomes the evidence it must die. Vermont must not mistake a death spiral for a diagnosis.
This doesn’t mean signing a blank check. Tie the payment to obligations, maintain the service, rebuild coverage and report transparently. If, after a real attempt, BMH truly can’t, the service should outlive the service line. Act 19 licenses freestanding birth centers starting in 2027. The natural place to prove that model is the region losing its only delivery room. Make the $3.8 million a bridge to reformed rates if BMH can carry the unit, or to a licensed successor if it cannot.
Closure has costs that Vermont has barely counted. A birth decides where a family’s healthcare lives; deliver in Keene, New Hampshire, or Greenfield, Massachusetts, and pediatrics, imaging and years of care follow. BMH acknowledged that ending obstetrics will cut its ultrasound, operating room and lab volume. We still pay for the births; closing a delivery room changes where the check goes. Leaders conceded they lack confirmation that Medicaid patients could deliver at Baystate without prior authorization. We are eliminating the service before finishing the replacement plan.
Asked why maternity wasn’t its “hill to die on,” BMH answered honestly: “Our hill to die on is keeping the hospital open and solvent.” Fair enough. The state’s hill is different: deciding whether rural maternity access is infrastructure worth paying for, instead of having strained hospitals subsidize it until they can’t. New Hampshire decided.
Hold everyone implicated by the record accountable. But don’t confuse accountability with abandonment. The question isn’t whether Vermont can make rural obstetrics profitable; it’s whether Vermont will price keeping it available. Before we close the door, run the numbers.
