BRATTLEBORO-Unless immediate decisive action is taken to transform Vermont's health care system, it will be financially unsustainable by 2030.
This is the conclusion of a hired consultant's 10-month review of health care in Vermont. More than 60 people attended a community meeting organized by the Green Mountain Care Board (GMCB) at Brooks Memorial Library on July 17, where the report's findings were presented and discussed.
The presentation was one of several being held around the state in July. It was led by consultant Dr. Bruce Hamory, an infectious disease specialist who works as chief medical officer for the consulting firm Oliver Wyman and its Health and Life Sciences practice.
Hamory and his team were hired by the GMCB in response to the Vermont Legislature passing Act 167 for health care reform. The legislation is intended to create a sustainable, affordable, and equitable future for Vermont's 14 hospitals and health care providers in general.
In the process of preparing the report, Dr. Hamory and his team visited each hospital and had more than 100 meetings with hospital administrators, staff, and patients.
Though the July 17 meeting focused specifically on Brattleboro Memorial Hospital (BMH) and Grace Cottage Hospital in Townshend, Hamory made clear that all the hospitals in Vermont are facing the same issues.
The report concluded that the "hospitals' financial health, particularly for rural hospitals, is poor and continuing to deteriorate."
Among those participating in the meeting were BMH CEO Christopher Dougherty; GMCB Chairman Owen Foster, JD; David Merman, MD, GMCB member; Health Care and Rehabilitation Services CEO George Karabakakis; Erik Rosenbauer, MS, Vice President of Operations at the Brattleboro Retreat; and Dr. John Saroyan, Executive Director, Vermont Blueprint for Health at the Vermont Agency of Human Services.
Local legislators at the meeting included Windham County state Sens. Wendy Harrison and Nader Hashim and state Rep. Leslie Goldman (D-Bellows Falls).
Opening comments noted that Vermont has the "worst health care costs in the country." The average lowest-cost Silver-level premium health insurance plan in Vermont is over twice as much as the national average.
Vermont healthcare costs in 2023 and 2024 have risen nearly 29% and forecasts for 2025 estimate increases of over 20%.
This increase in health insurance costs alone for a typical family over this three-year period is equivalent to the "cost of leasing a BMW," Saroyan said.
The problems
Since 2005 there have been 192 hospital closures nationwide, and the majority of those have closed since 2010. All of them have either been rural hospitals or those isolated from other facilities.
With nine of its 14 hospitals operating at a deficit, Vermont may look better than some parts of the country, but it will also be looking at hospital closures if changes aren't made quickly.
The problems facing Vermont hospitals include a lack of access and transportation to medical care, long waits in Emergency Departments, high insurance costs, a lack of communication with patients about possible help from financial services, and long waits for medical procedures.
BMH, like most hospitals, is dependent on Medicare and Medicaid payments, but the Federal government underfunds both programs, and in turn the programs underpay providers.
Operational challenges include a shortage of doctors and nurses; a low volume of patients in the state for certain procedures, making it difficult for some medical specialists to practice; aging infrastructure; and beds going to people with unmet social needs instead of medical needs.
"Many hospital services go to people who need another facility, or a place to live," Hamory said. "Their care is not medically necessary. Some patients are simply boarding. There are a lot less expensive places to keep people who are not medically necessary to be there."
Also driving up costs is the fact that most medical supplies in the U.S. are imported from China and subject to a tariff. France and Germany are also major medical suppliers. Republican presidential candidate Donald Trump has promised to put tariffs on all imports, which would adversely impact medical costs.
Commercial insurers are also making it more difficult for hospitals to be reimbursed. Administrators often find the majority of their time is taken up with paperwork and billing issues instead of focusing on hospital operation.
A shortage of doctors and nurses in Vermont has led to a dependence on traveling health providers, which drives costs up. Hiring a travel RN costs 1.8 to 2.5 times more than hiring a local nurse.
"Vermont has a huge issue with traveling nurses," Hamory said.
The lack of primary care physicians drives people to emergency rooms for treatment, a more expensive alternative.
Vermont also has an aging population, and advancing age presents unique medical needs. People 65 and older now make up about 23% of the state's population. That will increase to 42% by 2040.
"You've really got to plan" for this huge change, Hamory said, noting that the working age population, which pays the majority of commercial insurance premiums, will decrease from 56% to 48% in that same time period.
The solutions
"You've got three to five years to get this figured out and reasonably underway," Hamory said. "You don't have five years to talk about it."
Getting the entire healthcare system communicating and working together is key, the report concluded.
"You don't have a well-defined system," Hamory said, "you have a well-intentioned system."
The report concluded that efforts so far to solve these financial problems - increasing commercial insurance prices, reducing operating costs, increasing the volume of services and requesting financial relief - have been unsuccessful overall.
He noted that hospitals will not be able to solve these problems alone, but that it will take cooperation and communication among all healthcare providers in the state as well as legislators.
"Even filling hospitals to capacity," Hamory said, "will not make them profitable." He said an estimated influx of an additional $250 million would be needed to take hospitals out of the red by 2028.
"There is money there," he said, referring to the $6.2 billion Vermont spends on healthcare now. "But choices have to be made" in how that money is spent.
"Everybody is in the same boat," he said, "but it's overloaded and somebody just poked a hole in the side."
One change suggested by the report is to perform more outpatient surgeries, and move patients out of the hospital more quickly after surgery. Where in the past patients might have stayed in the hospital for a week or even two after surgery, it's now possible for patients to move on far more quickly.
The report stated that technology now makes some at-home treatments possible that used to require hospitalization.
BMH's Dougherty agreed that "keeping people as healthy as we can at home" so they don't need to stay in the hospital was vital for the future plans to work. He said it will require BMH to partner with visiting nurse programs for it to work.
Having certain hospitals with teams of physicians that focus on specific areas such as oncology or neurology will also be necessary. Again, this will require full cooperation among the state's healthcare providers in order to avoid duplication.
The study also found that hospital specialization would also help resolve the problem of providing enough patients to keep medical specialists in business, which is one of Vermont's more serious issues.
Dougherty said that all the healthcare organizations represented in the room would need to "be getting together on a regular basis" to keep everyone accountable in making changes necessary to transform the healthcare system. He said BMH will take the lead in organizing that in Windham County.
Hamory said that the final report would be naming priorities, laying out what needs to be done first so that the necessary transformations can follow. "You've got everyone in this room who can make it happen," he said.
He encouraged regular meetings among the healthcare organizations to monitor what is being done, and that everyone should leave those meetings with a list of what they needed to do next.
"You have very little time to start making changes," he said. "You really need to be engaged."
To read the full report and to submit comments, visit gmcboard.vermont.gov.
This News item by Robert F. Smith was written for The Commons.