Montpelier
Members of the board, which regulates hospital budgets and health insurance prices, brought up several concerns while three hospital finance officials explained why the network took in $41.5 million more in fiscal year 2016 than was budgeted.
The UVM Health Network started in 2011 under the name Fletcher Allen Partners. It was designed to be an umbrella organization for what are now the UVM Medical Center and the Central Vermont Medical Center.
The network has grown substantially since 2011. The UVM Health Network now controls three hospitals in upstate New York, and will control Porter Medical Center in Middlebury, Vt., by the end of the month.
Cheyenne Holland, the chief financial officer for Central Vermont Medical Center, said Tuesday that the number of outpatient practices the network owns in the region has grown by 10 to 15 practices in 3 to 5 years.
“We are expanding out into our community,” Holland said. “What we have seen is a need for us to find other labor. We have not been able to recruit fast enough in order to meet the needs and the demand.”
She said the hospital has looked to traveling nurses in order to maintain staffing. She said those traveling nurses have been a major expense for the hospital system, and they hope to eliminate their use by the end of May.
Con Hogan, a member of the board, questioned what he called “rapid expansion” of the network’s doctors offices near Central Vermont Medical Center.
“I live in Washington County, so can’t help but notice,” he said.
“You folks have put together a pretty significant institution,” Hogan said, referring to a building on Barre-Montpelier Road in Berlin that offers urgent care, physical therapy, and rehabilitation therapy, among other things. “It’s a big deal.”
“My assumption is that you’ve done this under a period of time so you’ve never come under the (certificate of need) requirements,” Hogan said.
The certificate of need process requires the board to approve new capital investments in health care in an effort to control health system costs.
Holland said the hospital system leases the building, but does not own it, and that its use grew over the past five to 7 years. She offered to get Hogan additional information about the facility.
Jessica Holmes, an economist who sits on the Green Mountain Care Board, asked how the network sets its hospital budgets.
“Are you one hospital? Are you two hospitals? Are there firewalls between the budgets? How do you allocate fixed costs between the hospitals,” she asked.
Holmes said the documents from UVM Medical Center and Central Vermont Medical Center explaining the $41.5 million in overages are extremely similar. She joked that they almost looked “plagiarized.”
The approved 2016 budgets were $1.1 billion for the UVM Medical Center and $174 million for Central Vermont Medical Center.
The hospitals went over by $25.4 million (2.2 percent) and $16.1 million (9.2 percent), respectively.
Todd Keating, the chief financial officer of the UVM Health Network, said the hospitals work together more and more as time goes on.
“When you build a network, your hospitals now become the departments within the network,” Keating said, “so they do begin to start to work with each other.”
He said the UVM Medical Center and Central Vermont Medical Center work together “all the time.” Keating said the UVM Medical Center also works closely with the network’s three hospitals in upstate New York because of their proximity.
“We look at it as a network,” Holland added. “We want to come together with a budget process and look at us as one. As we’re moving resources across our network, we really need to be concentrating on our story from a network perspective.”