Scott Administration Outlines $375 Million Health Care System Bailout | Off Message

Scott Administration Outlines $375 Million Health Care System Bailout


Secretary of Human Services Mike Smith - FILE: JEB WALLACE-BRODEUR
  • File: Jeb Wallace-Brodeur
  • Secretary of Human Services Mike Smith
Gov. Phil Scott's administration provided new detail on Thursday about its plan to provide $375 million to the state's beleaguered health care industry.

In a presentation to the Senate Health and Welfare Committee, Human Services Secretary Mike Smith said the administration had already doled out $42 million in emergency funding to health care providers during the coronavirus pandemic and hoped to give the industry $333 million more.

"Vermont has a goal of a health care system that is financially viable," he said.

Scott and Smith have been hinting for weeks that they were working on a plan to inject more than $300 million into the industry. During a press conference on Wednesday, Smith indicated that the number could be as high as $375 million. "[It's] going to be quite expensive," he said. "Our health care system suffered quite a body blow during this."

Funding for the proposal, which must be approved by the legislature, would come from the $1.25 billion Vermont has received from the federal Coronavirus Relief Fund. Two weeks ago, Scott proposed spending another $400 million of that money on an economic recovery package.

Smith told lawmakers on Thursday that the money would be divvied up based upon the proportion of total health care dollars each sector within the industry has historically spent. For example, hospitals would receive $190 million, mental health providers would get $64 million, and physicians would take close to $36 million. Dentists, nursing homes, home health agencies, adult day providers, ambulance services and other health care organizations would also be included.

Under the administration's proposal, organizations seeking aid would have to apply to the Agency of Human Services, Smith said. The state would make a "needs-based assessment" taking into consideration the business disruption an organization has faced, the amount of money it has spent on coronavirus-related expenses and any assistance it has already received from the state and federal governments. (According to state Auditor Doug Hoffer's office, Vermont hospitals have already collected more than $247 million in direct assistance from the federal government.)

The money would come with certain strings attached, Smith told committee members. Health care providers would be required to use it to "sustain or improve health care quality and preparedness in the context of COVID-19," continue to serve patients and offset costs borne by Vermonters.

"I don't want providers to take this money and then drop dialysis, for example," he said. "We want to make sure that if you're going to take the money that you're still providing essential services to the community."

The Health and Welfare Committee has been taking testimony for weeks from health care interests, as well as childcare providers and food security organizations. According to its chair, Sen. Ginny Lyons (D-Chittenden), the committee has identified priorities, such as supporting adult day centers, but has not yet settled on a particular plan.

"I think it's great that we're starting to get an understanding of the administration's proposal," she said in an interview. "I think [our] interests are similar. We might be approaching it differently."

Lyons said she was particularly focused on ensuring that any assistance the state provides the health care industry ends up supporting its employees. "How do we make sure it's the workers who are benefiting from this, as well as the organizations that we're looking at?" she said. 

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