Montpelier
As part of the ruling affecting the fate of the Green Mountain Care Board, which regulates hospital budgets and insurance prices, the court reversed a board decision from December and sent it back for reconsideration.
The court published the bifurcated decision on Friday in response to a lawsuit from MVP Health Care, one of Vermont’s two major insurers. MVP sued the Green Mountain Care Board.
The two parties went before the Supreme Court on June 22.
MVP sued because the board rejected its request to raise premiums more than 27 percent on a self-insured plan it administers for Agri-Services, a farming association whose insurance plan covers a small group of employees.
The board decided in December that the proposed increase was “substantial” and higher than any other the board had ever received. Additionally, the board said MVP filed requests for price increases too late in the year for its customers to have enough notice of price increases.
“The above-described events, taken together, illustrate a lack of accountability to the board as well as to the Agri-Services membership, and lead us to conclude that the proposed rates do not promote access to quality health care and are unfair, unjust, and inequitable to plan members,” the board wrote.
“We decline to approve the filing and any requested rate increase, and encourage the carrier to evaluate the (Agri-Services) plan’s continued viability and affordability prior to any future request for additional rate increases,” the board’s decision said.
MVP then asked the board to reconsider, and the board refused in January.
In its subsequent lawsuit, MVP argued the decision was made arbitrarily and that the Vermont Legislature unconstitutionally delegated the power to regulate insurance prices when it passed a 2011 law creating the Green Mountain Care Board.
The Vermont Supreme Court said the board failed to justify its decision.
“We cannot conclude, based on the record before us, that GMCB has given us an adequate explanation to determine the reasons for GMCB’s decision and how they are consistent with the statutory standards,” Justice John Dooley wrote in a unanimous decision.
“We conclude that (Vermont’s insurance statute) is constitutional but agree that GMCB’s conclusions were not supported by specific findings on the statutory criteria required for approval of health insurance rates and reverse and remand for new findings on that ground,” Dooley wrote.
The court criticized the board for labeling seven different paragraphs as “conclusions of law,” when it said those could only loosely be defined as conclusions.
“It is unclear, however, how these events relate to the statutory standards and why the proper remedy for these facts is to deny approval of any rate increase,” the court wrote.
At the same time, the decision upheld the board’s ability to perform one of its core functions: regulating health insurance prices.
The decision cited case law from Vermont and other states before saying the Green Mountain Care Board has constitutional authority to regulate health insurance rates as long as they are not “devoid of any conceivable standard to guide and constrain discretion.”
“Here, GMCB’s discretion is curtailed by considerations of affordability, the promotion of quality care and access to care, insurer solvency, and fairness, as well as by the requirement that it consider the opinion of the Department of Financial Regulation,” the court wrote.
The court said the requirements of the law are necessarily “general and open-ended” because of “the fluidity inherent in concepts of quality care, access, and affordability given advancements (and setbacks) in technology, medicine, employment, and economic well-being.”
MVP Health Care declined to comment for this story.
Al Gobeille, the chair of the Green Mountain Care Board, called the decision a win for the board’s constitutional authority and a loss because one of his responsibilities as chair is to make sure decisions can stand up to review.
“We always knew that there would be challenges to our power, and with a new entity it’s really good to have the thinking of the Supreme Court about the limits and the methods of your power,” Gobeille said. “And I think this is a great document that will inform our board and future boards.”
During the June 22 hearing, Justice Marilyn Skoglund said the board’s original decision read as though members “were really angry at Agri-whatever.” Skoglund said one of the factors the board cited “seems like a completely inappropriate factor.”
Gobeille said: “I definitely don’t think the board was mad. What I think is that we were frustrated with a late, inaccurate filing that made this more confusing than it needed to be. That’s where the board was.”
Gobeille said the board will ask MVP in writing what the future of the Agri-Services policy is.
He said the company told the board verbally that the Agri-Services policy would end, but the board needs to confirm that for the record.