Thank you, Mr. Chair, I have a few announcements. First, I just wanted to review the order of business for today. We have a very long meeting schedules. We're going to start off this morning here at 9 AM. And then when we finish up with the hospital budget discussion by our internal staff, we'll recess for lunch and then we'll come back at 1 PM. And we're going to hear from UVM MC and the insurers. And then that will take us out until about 3 o'clock, depending on how long that goes. But we have the whole afternoon scheduled here as well. The other thing I wanted to mention out front is on the table, our copies of our March schedule for board meetings. They're also listed on our website. We're going to have a busy month in March. March Madness is at the Green Mountain Care Board. So please reference that listing out front and on our website. The last thing I want to announce, and I think many folks know this, is that our Director of Health Systems Finance, Andy Polito, has announced his retirement from the state government. After a 26 year career, 15 of which were at Corrections, which I think is probably needs to be highlighted. We are very, very sad to lose Andy, but very happy for him. And that he'll be now the Dean of the Community Colleges of Vermont. I got that right, right? Close enough. So I think we should give Andy a round of applause for all of you. Speech. I would just say, Andy, that I'll always remember you telling me that your father always thought you'd get into Corrections. He just wasn't sure which side. And that's all I have to report. OK, the next item on the agenda is the minutes of Monday, February 26th. Is there a motion? I'll move approval. Second. So it's been moved and seconded to approve the minutes of February 6th about any additions, deletions, or corrections. Any discussion? Seeing none, all those in favor say aye. Aye. Any opposed? OK, so at this point, we'll turn the meeting over to Dean Warmer. That's an animal house thing. Thank you for that. I appreciate it. It's hard to end 26 years when we do the same thing day in and day out. Not only am I obsessive-pupulsive, but I'm a very mutant-ized person. And so changing a routine after that, like the time is, well, I'm sure by March 20th, it'll all fade in the distance. But anyway, thank you. I appreciate everything the board's done. And it's been fantastic. It's a fantastic way to end my career being in there. It's been great. Unfortunately, I have to listen to me for the next two hours normally, so by the end of it, you might be able to get them out. So just a quick reminder of what we're going to do today. This afternoon is dedicated to the 2017 Actuals. You'll hear from the Health Network about their overage on the ampere and why. You'll hear about utilization and the potential for 18 and whether or not they think. They'll be over or under again. And then 19, what you'd likely to see in their budget proposal. And we talked at the board meeting last time about a potential for a rate cut. Because in fact, they were over, as a network, about $40 million, half of which went into cost, so they're over about $20 million. So that's just in 2017. And I think it's important to drill on whether or not they think it'll repeat in 18 and then 19. But right now, that's what you'll hear from me. Then after that, you'll hear from Blue Cross and MVP. If we were to do a rate cut, where you can see that likely in the filing that's due to us in a couple of months. So we're not going to show it, so as a way to put the money back into the system. So that's this afternoon. This morning is dedicated to the 2017 Actuals. This morning is dedicated to 2019 guidance. The process, we've sent these instructions. This guidance out to the board. It's on our web. What we'd like to do is walk through, I want to say, a page at a time. But not all of it is really, some of it's about inputting it in the system so we can go around time fast. But this is a big, last chance to really drill in more. I hope to get the final guidance posted tomorrow, if we can, at some point. And open for public comment. And then when we come back on the 14th, take a final vote and get the guidance out right after that. After we do the guidance, we'll have a conversation about NPR. Tom Crompton has pulled a few economic indicators. What we try to do is broadcast the indicators similar to how they did the state budget with the rolling average. But we'll get into that after. So it's OK. I can just start going through a page at a time. I'll highlight the changes, specifically the ones that came out of the CFO meetings. A couple of these are from board members that I might turn it over to them to address the individual pieces. So this is page one. Page two is just a table of contents. A lot of this is framework from prior years, so it's not changing a heck of a lot. Unless there's any comments, I'll just keep moving along. Page three is our timeline, probably the biggest piece that is for the board. It's first, we're opening it up to have the input down by earlier June, the numerical sections. We gave till July 2nd mostly because of the narrative. The narrative requires a little more total stuff from the hospital. So we're hoping that the hospital team can do their analysis starting somewhere at the end of June and give us a little bit of a jump on it. Then we've committed to July 30th for questions from GMCB and the HCA. And the HCA has put a memo in this guidance, which is new this year that will hopefully really ramp down on questions between the entities. So that should be a significant change. Then back to us on the 10 responses, which will allow the board a chance to really read what the responses are well in advance of the board meetings last year that was a two day turnaround, which, you know. So, and then these are the hospital budget hearings. This is Monday, Wednesday, Monday, Wednesday, and the thought of Monday and Montpelier, Wednesday on the road, Monday and Montpelier and Wednesday on the road. So that's kind of the journey, and the rest of it's just to read them. So unless there's any comments, I'll just keep moving. But that's the schedule. Page three, the big change here is on the second half of the page, which is presentation instructions. This is a combination of things we talked about at the CFO meetings and then what we talked about at the board meeting last time. So I'm going to just walk through these quickly, and if there's anything I'll stop. But basically an introduction and overview, hospital issues and risk and opportunities. These are areas that are specific to each hospital. We wanted to allow a little bit of time for the hospitals to kind of give their nuance, what makes them their hospital access and wait time. We've gotten comments about creating a metric for access and wait time for each of the hospitals. Then some financial framework, which is profit and loss, cash flow balance sheet, and then the state and out of state mix that we talked about the last time, allowing each hospital to come in and give their nuance on what the state and out of state makes. And then expense drivers and cost attainment. One thing we heard from the CFOs or the CFO meetings that they all have cost-attaining efforts over here in order to live within the NPR. We thought we'd like them to talk about it. But the response to the quality measures that we will be putting out, and the quality measures, there's a framework. Is there an approach to that? Data-sharing framework? You know what, I think I forgot to bring it to us. It's basically 20 indicators along the lines of the three outcomes of the all-payer model, which are, I don't know if you know this all, but, so that's, if our original design was to have the indicators done by the middle of March, that may or may not be possible. What we'll do is put at least a framework in by the middle of March when setting the guidance out. And at some point, either towards the end of March or the middle of April, we'll addend it. Pat and Michelle will put out the actual indicators. We didn't want to rush them too much, because really, we're about done. So these are the exact indicators that the volunteers in this room are working on? Exactly. There's nothing new here, and all we're asking the hospitals to do is address them. We're not asking them to buy someone like that. And then the community of these assessment progress on ACO, reform investment outcomes, I'm so sorry, the reform investment outcomes has to do with priority. We think hospitals have come in, they've asked for the 4%, we want the 0.4%. We want to know how they did. And then there's a change this year when they propose reform investments, how you can indicate, how do you go to measure success for the board on those outcomes in future years? You can look back and say, yeah, that was worth a given investment, where are we going to improve future investments? CUN updates to talk specifically about what is affecting the balance sheet, and you can state this year, and maybe affect it in the future year. Because one of the things the financial teams have been talking about is the cash on hand. What's a metric to measure cash on hand, and that actually feeds into this. Then talk about long-range financial outlook. Outlooks sort of how Brattleboro did it this year, where they were concerned about moral health money, just to let us know it's coming over, and how it'd be done in compliance with our body guard. That'd be better, close, also nice, so that's all we're going to talk about. Just a couple of questions. Are we giving specifics, and we've come out with what that wait time measure is going to be? Are we still working on that? We haven't, we haven't, we're going to have them come in and report on what is your wait time. I think that we should standardize that, because I think if we throw it out to 14 different hospitals, they come back to different wait time measures, I think it doesn't allow them to happen. Do you have a proposal? Yeah, my proposal will be the time to third visit. I'm sorry. Time to third visit appointment, how long it takes to get a third appointment. Because what they say is what I understand is that, because there can be some same day cancellations, it doesn't always, you know, the next visit appointment doesn't always really measure the true wait time. Silly call, the third next available. The third next available, thank you Mark. I knew it was the third next available. So I think we should just be standardized on that. So I'll change this to, with the time waiting measure and then the parentheses time to third next available visit. Thank you. And I'm just wondering just, in presentation wise, does it make sense to combine four and six, because it's really all quality, so when they're responding to the 20 quality measures, I think it could be lumped in, also to be amounted to access and wait time. And then the other piece that I would just add to this, I think is, I think number 10 is great to have the CON updates, but I think having a slide about the capital expenditure plans, just in general, long-term capital expenditures, because there are some capital expenditures that don't fall under CON that we should be hearing about, I think. Particularly given there's some legislation moving now that moves purchases of non-medical equipment out of CON. So that's gonna be something that would have been in our CON conversations that if that's passed, we'll not. And we had suggested that would be part of our hospital budget process. I think it should be in the presentation. Okay. Is it sufficient just to say slide on capital expenditure plan? Then all right. Okay. I think we may want to talk some more too about that measurement on wait time. Just based on the feedback we got from the public at the last meeting and feedback that I've heard anecdotally from different homeowners, I get the concept of the first versus the third, but if you're someone that has, for example, in Melanova, and you can't get in for that first visit for more than half a year, that's problematic. We might need to have a couple measures there. It's just something that we should be discussing. Well, what we can do is we can throw it back to the hospitals if you're comfortable. So time between the third next develop visit and other wait time measures to allow the hospitals to come in. Because what we might find is one of the hospitals we can do like we did last year, cherry pick one indicator that we like. So I have that kind of comment. I don't know what your comfort level is with allowing the hospitals to have a little bit of... Well, maybe the simple statistic is the wait time for the first visit and the third just have those two measures. Okay. The other idea would be on that is since we are gonna be in a public comment period, that's okay to make a suggestion to us during the public comment period and we can make a final decision when we vote. Is it gonna be an action? Yeah, if you're good to get that input from the hospitals and the doctors and the state. Because if I can just add Jess and Robin before there was a full five member board, we did a whole segment on access. Remember that board meeting and there were different ways like Dartmouth handles wait time. They don't do whatever it's next third equipment, whatever it is. They use a completely different system. So I agree with Robin if they could provide their input the hospitals on what measurement is gonna be the most accurate and then we can assess it. I mean if I would just add on the CON update to make sure that also includes how they're tracking to what they've presented in their CON. So it's gonna talk about the current CONs that are running and in the future but they submitted a CON. How are they doing against the performance they had put forward in that CON? Other variances. When we talk about the long range financial outlook to the extent, and I know we may or may not do this but to the extent that we put out a two year NPR that they're tracking that as well in there. In their long range financial outlook. Let's do Adam. I don't know what Marie just said. Looking at the long range planning, we are 2018 as you know it's the first year of the all bear waiver in 2019 is the second year. And so as part of that long range planning outlook it will be helpful just to have a clear view of what targets are that we're trying to hit and how we're doing all of those targets. And I think just one more thing when we talk about you know the standardized presentations must include the following. You know I think we just also wanna say hospitals need to be telling their story and so whatever else needs to be included they should be putting that in there. So to the extent like I agree with Jess their capital expenditures that should be in there when they're talking about their cash flow balance sheet. And you know so these are the things that we wanna make sure are covered but of course they need to put in anything they think is relevant to tell their story that year including more financial metrics, more quality metrics but it must include these slides. Yeah I'll put something in there about other items. I think there's an opportunity where something happens after you wanna know that they brought it to the intentional board or at least had the opportunity to encourage me over the word. Okay. I think I got it on. Is there a narrative instruction? There's some changes in here as well. And they are starting at number two. What we are asking in this section is about the all pair model. Whether or not they've signed on with one care how much they expect the fixed perspective payments to be we asked about a risk and how it's accounted for on the financial. Our thought on this when we get the financial submissions from the hospitals to take all of the revenues off the hospitals that are attributed to the ACO and pass some of them on to Kelly to one care and ask them as a starting point is this seem to make sense because we wanna know that revenues are flowing down through and into your own hospitals. We know the change, but at least as a starting point seeing the risk we wanna have some kind of an affirmation that the hospitals are aware of the risk and that we can look at their cash balances and make a determination as to whether or not it's kind of within a band. We also ask about E about the reformer quality addition of payments so that we can also see where those are present in the financials. Then we ask again about the community of needs assessments. Great jump, sorry. In 2A, I think I'm gonna add this whole question, if no, why not? So has the hospital signed a contract with one care and no, why not? I think it's important for us to understand why hospitals would choose to be in or not. Okay. Just when we talk about risk with the hospitals that they separated into two different areas. One area is the risk they're assuming or the attributed lives that occurs outside their hospitals. So that's typically the risk number that the ACO is presenting, about the $28 million. That's kind of the risk that falls in under fee-for-service. But then within the hospital laws, they receive a certain amount of payments for those lives for the hospital. And how do they perform against that? And is there a way to track that? Because I think that's the risk we're not really always talking about, or we're talking about the risk for fee-for-service that's occurring, not necessarily within that hospital, when that person goes somewhere else. We won't know that for, we won't know that for this submission. That'll be a question, if I understand the question. That'll be a question for next year's submission because they won't know that until, so the first year of end this December and then there's a reconciliation that takes anywhere from three or four months. So by the time they submit in June of 19, we should know that definitively how the risk order has worked out for them and then make a determination. So I think that's a question we need to include on next year's. I think they'll know that they won't know what the risk is, but they'll know in 19 that they're receiving a certain amount of money from the ACL for their hospital. That has a risk inherent to it. And then on top of that is the amount of risk. We can talk about that after this. Yeah, because the way I understand it is the risk, you won't really know until the year ends and then they go through the reconciliation process. So you could be up on the front end of the year and down on the back end of the year or the other way around because the payments are staggered through the year but the service is not that good. That's what we're going to know. But I wanted to put something in if you want to word it. We can talk about it. Yeah, we can talk about it. I think, yeah. Okay. Then on number four, we start to get into, let me go back to number three. Number three is again, population health goals and the community health needs assessment and then the AAPM network framework. And then number four is the question regarding mental health patients and care. Some of this comes from, we kind of, I plagiarized off the HCA on this question because we've talked about it in a couple different ways, framing some questions around mental health. When we have toured, we've heard about mental health and what just costs in hospitals, in the mountain, in the intensive care and so the stuff. We, the HCA put this question forward and I took it for hours and I don't know if you wanted to change it. Basically, how many beds do they have? How much weight time? How much are they spending on it? And was it because of an available mental health or so on and so forth? So this is just a way to start to dig into this issue that all hospitals have talked about over the last few years. And Andy? Yes. Can I add one more? I don't know. So E? E, yeah. I think if the hospitalists could estimate the average cost per day for patients waiting transfer, then if we get the number of patients and how long they've waited and how much it costs per day, then we're starting to get an overall estimate of the total cost of the system of these ED holds that those average costs may differ by hospital. So it'd be helpful to know. So if the board wants to- So if we're looking for that, we should say average total cost because there could be a lot of different ways to interpret the equation to figure that cost. It's just for the individual patient, but there are oftentimes other costs related to that. So. Okay. And I guess when you say D, the total number of patients who waited in the ED for an available mental health bed at this hospital or another facility, what is another facility? Community for a chance to stay in a hospital or a bar, bar, bar, bar. Oh, okay. Sorry, I'm just misinterpreting that. Got it. Okay. And they're waiting at another facility, not that hospital. How would they know that? Okay, I got it. So that's it for number- Can I ask you a question, Andy? Sure. On these metrics, have we talked with the Department of Mental Health to see if they're consistent with whatever metrics they're already collecting? Just because I'm wondering about if hospitals are already reporting this to Department of Mental Health, it might be easier to just collect that and ask DMH to provide it to us instead of recollecting it from all the hospitals. And if we're coming up with metrics that are different than other statewide metrics, that could be confusing. Okay. Well, on that one, if they are different, then we should be asking ourselves, why are they different and should it not be collected? Yeah. They don't pay in which file. So just back to number four, I know from my past life that they do track the number of people that are waiting at an emergency department. I don't believe, I could say with 90%, they don't ask about cost. You know, the total number of mental health beds, that's a pretty static reporting requirement. But I don't think they're asking about costs, they're asking about patients that are waiting. Because I know that whenever DMH testifies, they can answer the question, how do they have waiting in mental health in an emergency room for mental health bed? But I can take a look and see what DMH publishes and if it's repetitious. So I would say the cost piece is... The only thing is I don't think that, I don't know that I've ever heard them reported by the hospital, but they must have it by the hospital because they're given a macro number, but... I think the cost piece would help policy makers with better decisions, especially with geographic location of additional beds or just additional beds in general, and also to give them a clear indication of what the costs are in the system by not having the proper number of beds. Yeah, and I wasn't suggesting we not ask about cost, I was just suggesting that if the data's already out there, that they collect it directly from the other state agencies. Moving on to substance abuse treatment program. This is about M.A.T. number of patients enrolled in M.A.T. and the number of M.A.T. providers in the public hospital, this again. There may be existing V.D.H. data on this. I can take a look and see if they have any published. I'll read it. Then on number seven is health reform investments. This is a question about what they asked for of a 0.4% in 2018, what are they doing? How they're monitoring and how they're monitoring success. This is basically setting the framework for moving forward for when they request health reform investments. How are they gonna monitor and report back to the board on what actually happened? This is just for everybody to ponder about. We've had this 0.4 health reform investment after several years. So I'm wondering whether this is an opportunity for them to look back beyond just one year because it takes a while for these investments to actually return. So why just one year? There was an original proposal. So the HTA had originally asked for that to go back three years. And the general counsel changed it to one year. I'm open anywhere you wanna do it. She felt like it was a lot to ask the hospitals when I basically told her where I put her forward this way. But I could simply say extended under 2016, 2017 and 2018. Well, I guess I would welcome other feedback on that. It seems like we've asked for it after several years and I know it takes time for investancies to plant and come to fruition. So it'd be helpful to know what of the programs that they've invested and have worked, what hasn't worked, we can learn a lot from it. I think the HTA asked for three years in their original. This is there, again, I think I've already heard this from that. So this gets back to the concern I've had that I've expressed that it's been what I think too loosey-goosey. And I think we need to have a line here. What are the metrics that they're gonna use to measure their new investments as well so that we can see what type of results they get in the future. And if they can go back, like Jessa suggested, I think that would be very useful information because what we're trying to find out if something works at one hospital, is it something that can be duplicated at another hospital in the state and try to learn from the efforts that people are doing so that we don't make the same mistakes, but if something has done that results and good results, we really wanna try to get that information out as rapidly as possible so that others can implement it. So I'm gonna make the change to 16, 17, 18, just metrics going forward to measure success. They come in and say here's what we're gonna do and you can expect that you'll see these indicators move up or down depending on what the investment is. The other thing I don't see here is I'd almost like to have something that would tie those to a movement towards population health and wait for the fee for service and really looking at our ultimate goal which is looking at per capita hospital service areas, thems. So I'd like them to give us a narrative on how that's gonna help any of these reform investments, how it's gonna help to get us to where we ultimately wish to be. I think that description is in the budget, the net patient revenue guideline on nine. Okay. The only other, what I hope would be maybe a friendly amendment on Kevin's suggestion would be if the investment is tied to the ACO program, that the metrics be consistent with the all-pair model metrics since that is currently our way of measuring success in that program. Certainly a friendly amendment. Could you just repeat that one more time and... If they're tied to the ACO program, we would want the metrics to be the metrics that we're using in the all-pair model. And actually related to that, although I was gonna bring it up at the end, but in the narrative here, I didn't see, unless I missed it, but I didn't see any specific request to respond to the Green Mountain Care Board quality indicators and wait times, even though I know it's in the presentation, I didn't actually see it broken out in the narrative. What I'd really love to see is potentially the health reform investments tied to their response to the quality indicators that we're seeing. It doesn't have to be, but ideally, if this is a hospital service area that is really low in one of the 20 measures, it would be great if then the health reform investments are tied to trying to move the needle on that. So I think it should be a separate line about how they're responding to the... So you're talking about making future investments tied to specific outcomes? No, I'm talking about having the health reform investment request be to some degree, although I'm not, my personal opinion is not the mandate that it is, but it would be great if once there is, we are asking them to respond to the quality metrics, right? Although what I'm saying is that in the narrative instructions, I don't see that broken out. I didn't see that as... Number six, I see one in the narrative instructions. That's in the presentation, but I... Yeah, yeah. Okay, so I'm saying I think it should be in the narrative instructions, a section that says, please respond to the free mountain care board quality indicators and the wait times. So adding that to the narrative instructions and then ideally, the health reform investments are somehow related to their response to the quality indicators, although not a mandate, obviously. They may have other health reform investments that are more pressing, but... Got it. So before I go on to number eight, do we have the bridges tour? Or are we gonna... Do we have the what? Bridges tour. Yeah, can you hand it out to me? You all right? So for number eight, we've got a chart called the bridges chart. It looks like this and has a backside. This is the chart that Maureen worked on with us about monitoring expenses. And so basically for revenue stream breakdowns and sort of like that. Basically, look for eight speaks to their NPR and now they're submitting their NPR and now it's broken down by a payer, by, it comes across and down. We went through this chart the last time. The only thing I... I'm not sure what was going to be part of the system. Yeah, that's it. Thank you. Okay, so we have the floor up. Yeah. We talked about this last time. The only piece of feedback that we've gotten, one of the pieces of feedback that we've gotten from some of the hospitals and bosses concerned about the second half of the first page. And I think they brought this up the last time. And I'll put this to you for consideration, but they've talked about bottom half of page one. They don't think they can break this out because of the way services move through the system because what we heard from the hospitals, some are some make money, some, who's one of the birthing centers that's always under water, that some of the other services flow in. Warring was kind of driving at, we kind of like to just see that. So you've talked about it. Is there, if you're making a statement, you must have some type of data. And so, where we settle is we understand you may not be able to fill this out. Top to bottom, lots to right. But address why you think some of these services move money, some of them wait money. So the only thing I'm throwing in front of you is that potentially the hospitals will come in this summer saying they couldn't fill this out. But I think they could at least address it verbally or something like that. Maureen, do you want to talk about it a little bit? Yeah, I think, you know, some of the discussions we had, each hospital doesn't have this information necessarily broken out this specific way. The challenge that we would bring back to the hospitals is each of the hospitals has an understanding of where their revenue is driven from it. They may not break it out this way. So it was really trying to kind of tell that story of the hospital of where are you getting your NPR? What are the changes here over a year in that NPR? And what's driving that? And so it may not be this specific way, but when they talk in their narratives, they typically say we had more orthopedics or we had more charges for pharmacy or we had different big buckets where they had some changes. So it was really trying to say, almost what drives your business? What are the areas of the hospital that are driving your business? And how are they changing year over year? And particularly as you talk about the long range plan and things like that, how will those things shift?  How does that change how they're giving care to the patient? So it was really, this was one hospital to this specifically, but whether they have it in cost centers, whether they have it in units within the hospital. And I think part of the issue we heard was it's not always broken out necessarily by payer type or at this level and they can't break everything up specifically. It's really trying to say what's going on? What's changing in the hospital? And this was a way to try to talk to it and maybe said we're not gonna hold them to this specific format if they can't do it in that format. But really it's just trying to say rather than just look at revenue by commercial Medicare, it's looking at revenue by where is it coming from? What are the areas? So I think I put it to the board if there's no concerns, we should talk about that otherwise. I'll keep moving. I think you can keep moving, but I think that at that part 12 meeting where the hospital solicitation has been been talking to the board that maybe a proper timing. Perfect. Perfect. It's a number eight, this is a number eight. So item A is about it's a typical language that we've had on NPR. Then item B is about any cost savings. This is going to be repetitious of what we asked earlier on about talking about some of the cost savings and the issues you proposed. So if we give you a target, how did you get to it? Show us the ups and the downs, if you will. Historically, the state budget, you do, you start from a number, you do all your ups and then in numbers, and you take it to get down to the bottom on target. You guys know this because you just know through this, but basically the same look for hospitals and then changes in source.  NPR rate, if you receive the budget action, I think this is all the same language from last year up until item number 13. So if there's any concern with that, I'll stop for the rest of this. We haven't got to do the NPR number yet, which is a little separate. Yeah, I do have a thing that I want to add for being, you know, going through the budget process, I really thought one of the things that was missing was looking at, you know, where they think they're going to be against the current year. And, you know, as we now have received the actuals for 2017, that continues to be a concern. And I think in the budget process, I want to, I think we should put in that they need to give a reconciliation for where they are for 17, for the current year, up or down. As we look at the actual results compared to the budget versus where 17 came in, four of the hospitals came within that 0.5% that we allow, kind of, you know, if you come in with 0.5, you're okay. Six were under. I'm as concerned about the hospitals that were under as over, because six of those hospitals, several of them were 10% under their budget number. And when you build your budget, you build your expenses, kind of, targeted toward that NPR rate. And several of those hospitals are now showing, you know, deeper concerns on operating profit going further negative.  When they're tracking way under or underactual, we should be pushing it a lot harder to make sure that number is consistent and supportive of where they're going to come out, because they're building those expense ratios towards that higher spend, and then it comes in a lot lower, and they go negative, because they're staffing and everything.  And when they came in at budget, they were showing some of them quite a high number above where they thought they were going to come in for the current year. But we didn't really address that, so we kind of let that go through. And, you know, we're in a situation now, and I know we're going to talk about it later, where, you know, UVM has to be below in 18, where they came out in 17. And if we've gotten ahead of it a little bit at the budget time and really looked at where your action was trending, what's going on, maybe we could have taken some action at that time, you know, rather than now. So I want to see a reconciliation for where they are for actuals. And when we do the budget, I understand when they submit the budget in July and when they've prepared their budget, they may have only had three or four months of actual data at that time, you know, based on the cycle. However, the presentation is in August, and I would imagine each of the hospitals has a pretty robust budget to actual during the current year. So when they come in in August, they should be giving us a pretty live update of where they are trending against their current year budget. And then we can use that as another data point to see how that flows to the 19. Because going budget to budget, just doesn't really work as a metric, you know, year over year. And we need to consider where they're coming in for the actuals and then that would drive any change. So what I'm below number eight is about under number nine, which is reconciliation 2018 has submitted, actually we hasn't proved, to year-to-date actuals for 2018 with a year-end projection for 2018 actual, has explained any variances with the positive or negative. Because I think I've done a point where you asked a question about, to your point, what's the effect of the balance sheet? Because that's really the bottom line concerning them. Right. We're going to go ahead and look forward to expect that when the actuals come in, we're going to look back and say, you know, where did you guys say you were going to be, you know, come that August, and where did you end up at your September year-end period at that time? Okay. Because of the issue that you brought up, so we want to know the recon of the actuals, that should be in the narrative. But for their July submission, but then in their presentation, is to update that even more because they have two months more of actuals for one. Their response. Yes. I mean, you know, their response coming right against the budget is going to be a pretty easy chart, right? If they're coming in significantly above or below, that should be a consideration for us as we're looking at where their NPR rate is year over year. Particularly, it's easier for the ones that are lower, right? If they're coming in lower, I don't think they should be getting whatever NPR increase on the budget. You know, if they're significant. We have several hospitals 10% below year over year. I'm asking, do you want it in both the narrative and the presentation? Because if the narrative comes in in July, the presentation comes in in August, the timing of that information can change. Yeah. The next piece is the salary. There's a little bit of an error. Actually, Andy, before you go to that, when I was going to suggest to follow up on what Jess had said about the presentation, we may want to just add language from the bill around the non-medical equipment, just so that it's very clear that we are looking at that in this process. So, I think, you know, Mike or I can pull that out of the bill. Because now that those, you know, what exactly we're looking for, because I think that would be a good way to show that it's happening. So now, we're in attempt with salary information. We originally met with the CFOs. We've had concerns around the process of receiving the 990s, posting them online, then taking information on the GMC and staff taking information on the 990, posting it on the internet. There's a couple of different movements there. We thought we could streamline it. Some of this actually comes from the recommendation from the CFOs that they could reconcile, because we really only asked for a couple of other limits on the salary. They recommended to put the whole salary in. This would tie the 990 by total dollars here and total numbers. So you could tie it back to the 990s. Now, we would still get the 990 and post it on the web. But this would be for, I think I need to change the line of order just to make it clear. This would be for fiscal year 17 actions, so it ties to the 990. And I need to just change the footnote because the mistake even says number 13. But, so this would be at this point, all we're asking for is the 990 to be posted on our web and then this to be submitted in the web. So I'll throw that open for conversation. Because I've gotten different feedback from different board members. I guess my question is I'm very cognizant of asking for information and thinking about how I might use the information. When I see this table I'm not sure what I'm going to do with the information. And here's probably why. I think what probably board members are looking for is some idea of salaries, wages to some degree interest in that area because we know labor costs are really high. But I think instead of asking for this table because honestly I'm not sure what I would do with it I think what we should ask for from each hospital is their policy on executive compensation and on staff compensation. Do they use an outside HR consultant to benchmark? What are their peers? What are their goals? What are the institution's goals? To the extent that are they targeting salaries at the median? Are they targeting salaries at the 60th percentile against what national and regional peer group? And what are the actuals compared to what their benchmarks are? Because I think at the end of the day what we care about is that hospitals are not paying too much and not paying too little. We want to make sure that they're weighted or collected in some sense that price needed to attract motivate, retain, gifted people. And so I think we want to make sure that they're benchmarking, that the benchmarks are reasonable and that they have a policy. And that's what I would like to know about. And if they're, you know, where they fall actually relative to their goals. I'm not sure what I do with this table and this information. And I to be totally frank, I'm against public shaming people's salaries. So... The other thing I'd add is that on number two on page 25 which is the HCA's question and asked about financial incentives bonuses in hospitals. I guess it's something that Maureen had asked about whether hospitals aren't incentivizing their staff to blow by the PR and then there's about hospital buying basic incentives and so on and so forth. Yeah, incentives are very interesting. So I think asking about incentives is a great question. But I also, I go back to, I think we should make sure that hospitals have a benchmark policy. What are their goals? What are their target salaries? And where are they relative to those targets? To make sure that they're not paying too much or paying too little to attract and retain the people that we think will deliver high quality care in our state. So I'll give the contrary thought. I actually think that as a form of transparency having the names is important. And I think that these are not private companies. These are non-profit companies that are really community efforts. And members of the community are often asked to make donations and volunteer and things like that. So I think that the expectations of transparency are higher within these organizations than in other organizations. And I for one found tying the amount to the names somewhat informative because it became clear that at least in one institution I believe they are tying higher than average salaries compared to their peers in the state to the fact that it's a profit center for the hospital and is able to help with other areas. And there's nothing wrong with that but I think it's information that people should have access to. So on this one I support full transparency. I'd like to basically support the chair on this. This chart was meant to avoid the shaming of the 990s in a way. And just deal with straight budget information that we get in aggregate but it's not broken down. The cohorts here tie exactly to the cohorts used by the tax department in their reporting of the incomes by cohort. And if you are in the cohort at $200,000 and above you are in the top 3.3 percent of incomes for providers. I think that's important information and I don't know what we'll find here. You could be right that we won't find anything but we might find something that would be very interesting to the public about their hospital system that then would lead to a discussion to either validate it or have concerns about it. But this is an attempt to not be linked to the 990 process. Obviously we can link those on our website as a public document and it's helpful. But when I began looking at the issue of using 990s sometimes it does get focused on personalities rather than the context. This is a chart hopefully to take the entire salary benefit high and break it down in a way that we might understand relative to the total population that is followed by the 990s. But to the extent that really what you're interested in is I think are we paying certain providers or certain segments of the medical care profession to want you to a little bit more of a benchmark. What labor markets to some degree function pretty well in those ways to reflect the price needs to attract, to motivate the provider. So how do we make sure that we're actually benchmarking? That seems to me a more interesting question and how many people are in for each hospital in each of these categories. Because it could be that some of them are too low, it could be some of them are too high. We don't know unless we have some sort of benchmark. We don't even have the data to benchmark yet. And this is an attempt to build that information in a way that because it is a public concern up there it's obviously made headlines a number of times. But that's been on the personality basis as opposed to taking the whole pie and looking at it breaking it down and having a thoughtful discussion about whether the direction we're going on. Obviously labor costs are a big part as they are in the state budget. And I think this chart would be helpful to keeping the focus on where the money is being spent rather than where the money is being spent on. So just go ahead. Yeah, I would just add, I think this is definitely an area where the board has different opinions and I think that's great. I support more where Jess is at. I don't think that we should be managing the hospitals down to who's getting paid and how many are in those buckets because without relationship to something else I don't know what that means. If there are 10 people in the 400,000 plus bucket, what I do think is we should be looking at how their total expenses and how we can control the expenses and push them on that and salary increases and things like that. To a point that Andy was referring to on the bonuses I think we should have an understanding on are the bonuses that the executives pay tied to what we're regulating them to. So how does we give an NPR target of X and a hospital comes in higher or lower to that how are they rewarded on that? And that would be interesting to know if there's a pretty solid reward when they beat the number that kind of goes against what we're trying to push. So it's really to say are they in alignment? So are there financial objectives for bonuses in alignment with where their regulatory guidance has been set? So that I would like to know not this way at a person level but just a concept. And there I haven't been able to find that when I look at the company is that's very transparent. The CEO is paid on whether it's top line gross margin EPS but it's really clear and the guidelines are real clear. I haven't seen that other than to see that they need to be focused on financial operational and quality metrics but what are those metrics and are they in alignment? So just to follow up on the earlier statements one of the things that is problematic sometimes with benchmarking is somebody may come in with what's the average salary in the northeast which would include Boston and New York and I think that most people recognize the fact that in many fields in Vermont you are making less if your peers are elsewhere. It reminds me when I was on the Rockwell Town School Board many years ago we reached in past with the teachers we had had a history of trying to be the better payer in the region but after back 60 past it became clear that we couldn't be the better payer because of the new rules of the game and when the Vermont NDA negotiators came then the first thing they tried to do was benchmark Rowland Town to South Burlington which at the time had the highest paid teachers in the state trying to make the arguments that Rockwell Town was similar to South Burlington I know this is a totally different field but I'm just that kind of does at the back of my brain when I think you could make an argument no matter how you want to do it for if you have a particular position you could make an argument for being a $290,000 position or a $540,000 position based on the information and tools that you use to make your argument I just feel that in this particular case I'm not trying to micromanage the hospitals I'm not trying to tell them what to pay I think I see our role as providing the information so that the board members were trying to do civic duty and all these different institutions can have a point of contact on the Greenland Care Board website where they can see what others are being paid and I just think it's useful information I would definitely never try to use that information to cap salaries or anything like that but I do find the information useful so this is a little big case to what's been gone on my cubicle for the last time so here's what I was thinking and I'll just offer this up the question from the HDA is on the standard unless we want to get to the point where we're sanitizing this area I'm not sure we're going to do that so they asked me a question about bonus compensation which I think is directly responsive to more of these points but there's basically three in my mind there's three things that the board needs to make a decision on one whether or not we're going to receive a post to the 990s I don't believe that you are just agreeing on that does everybody agree on getting the 990s information so I'll give you this one what if we took our straw poll on the 990s at this table and then taken the 990s and Q-ringed at the expression does that get too fast I'm not ready to do a straw poll yet because one of the things that I remember but I don't have in front of me is the amount of information of each binder that had a lot of information about employees and I thought there were some benchmarks but I could be remembering wrong so I need to look at that because I want to understand all of the information we're currently collecting and how it fits together or it doesn't and I'm happy to collect additional information but if we're not going to use it it's about how much goes into salaries at a whole dollar or not it doesn't break it down by a number of important I mean you could back take a look but it doesn't break it down in the income room like this does or the number of employees in each of these groups so there's I think a differentiation between physician and non-physician and it's done the whole dollar and it's a 49 any comment or philosophy on executive compensation and or general staff compensation where are they trying to target yeah and I don't remember ever seeing that in any hospital budgets I agree with that and that to me is more relevant information to figure out where are they trying to target their salaries than this I agree the context is important because I think the there's two contexts that are important here one and I think part of the split is based on which context you're more focused on so I think the national and regional context is important because it quits the recruitment and retention conversation up front but there is also the context the Vermont context where I think to Kevin and Tom's point that people the general public may not necessarily understand that if you're paying regional or national salaries in this industry that is necessarily going to put these employees at the higher end of the Vermont income scale and I don't know I guess where I'm at is I think both of those things are important I don't know sitting here right now what I think is the best way to collect the information there is my ending I'm bridging the gap I guess I would say that I could be persuaded that we could include this table if we also had the context information of the benchmarking information so to the extent that we put it in a larger context of the benchmarks and with the philosophies of benchmarking from each hospital are then I would feel more comfortable with that doesn't make sense to me I would support that I just think from a way we always hear these issues about affordability and this chart was made or designed to actually do two charts one for medical staff and one for non-medical staff so that and it's all in it's a complete pie and it ties back to the budget it's the actress on the budget so it's not some free-floating piece of information it is the number and people can see well maybe this is what folks are getting paid by these incredible salaries they can see it all and I just think that context is important but I agree with you that the medical community operates in its own context and so getting those benchmarks having those benchmarks for New England region or the nearby states those I think is a good idea do we have what we could do I'm trying to get to a decision we could do some so what I'm going to do is I'm going to even in as it's written exactly there's a couple of edits out there even in as it's written and then when we send the final out about 12 that'll be the time when we come back on on the 12 on the 14th or so whether or not we want to leave this in as it is very much I want to just add leave it as written and then just add another thing to say give their policy most places do have an HR policy what their range is that they'll pay and how they come up with that some people use outside consultants that's what I'm looking for I think to have that is fine I would say when we reviewed this in our meetings with the CFOs they did I believe they could provide the information that's why I'll give a point of view whether they should be or not but that this information could be provided it was something that could generate their systems I think that makes sense I think everybody agrees the context is important so having that context makes sense to add that for the next meeting and I'll also just say this because it would be an area of potential public comment is could we also look back at that other information and determine whether that's necessary if we're getting this as well the information that's in the budget but currently well that would be for you to determine whether I would think it's official I'm just saying let's have the mock chart with the materials so that we have it all together so I've been asked to take a break so that we can try to straighten out the sound so I guess let's break for about let's break till 10.15 we're getting to the more mundane parts the year over year part and then we'll build for the some of our MPR organizational structure we ask for every year including a section on the healthcare advocate which we'll talk about in a minute and this is all about adaptive input it's basically generic this is where we'll specify the MPR targets and what it will say is as of March 14th which will be when we finally vote we set an end to our limit and then an additional allowance for health reform investments we talked about the last time so that's what this page said then page 10 is about to be on the MPR investments I would just be very clear that the increasing access to primary care preventive care etc. that those are tied to the APM agreement just so that there's no confusion where that's coming from I think that's more of a technical addition yeah I would also just add I think this is Kevin's point earlier but I think we should just add language specifically that says any investments must be accompanied by a specific plan to measure or a law what measures will be used to measure success of any HRR health reform investment adding that language any investments must be accompanied by a specific plan to measure return on investment what measures will be used to measure success of the reform investments just exactly what I was trying to say but she did it much better if we're tying investments specifically to the all-care model measures shouldn't those metrics be the APM metrics so this is narrower than what we did last year last year it was broader and a lot for investments in the community health needs assessment this is not so narrow as to only require it for ACO investments so it is broader but I would think even if you're doing an investment outside the ACO to meet these metrics that the metrics should be what we're already measuring in the APM agreement I'm looking at Pat to see if that makes sense certainly just identify yourself for the record Pat Pat Jones health care board staff I think if you look at the table at the end of the guidance there is a specific effort there to link the health care reform investments to the all-payer model quality metrics we specifically are asking the hospital to identify which of the 20 metrics that they will tie the investment to so that piece is there the ROI I think goes beyond that I think the Robin has brought up is an important point because we all need to be rolling in the right direction these are the metrics that we believe get us rolling in the right direction so I think tying it in makes sense and what I would say about the ROI is that the ROI if you will in the all-payer model is reducing the rate of growth for total cost of care at 3.5% Okay I'll question a little bit more Ben on page 10 this is a repeat of last year on recruiting open needs assessment language 10 and 11 then we get into basically 8x12 which is a repeat of what we did with the NPR was there any feedback from the hospitals where the needs assessment is appropriate as a wrap-up? No, I didn't get anything I did not get anything I guess silence is gold Silence is a group Page 12 the only thing I mentioned this is kind of coming out of rule 3 the only thing I mentioned is just to remember whatever we said for NPR hospitals are considered to be compliances over as long as they're around 1.5% plus or minus but this is just a repeat for the hospitals rule 3 then physician transfers all standard language reporting documents a lot of this is adaptive Ben you can't just go back sorry back to the health performance investments well I'll agree that we can totally agree that I think some of the measures are at the hospital service area and I can imagine a hospital taking on a particular program that is targeting a particular chronic morbidity and what we want to see from them is that that particular hospital specific program is having an impact so what's the starting point at whatever measure they're using and then how does it end next year so that they're really dialing in on their particular program it may blow up or link with the hospital service area quality metric that's being captured there and maybe another metric that they can use but the impact on that larger metric in a year may be small but it may be larger on that hospital's specific metric so I guess I would still encourage us to ask the hospitals how are you going to measure the success of your particular hospital based program along the lines that hopefully are aligned with the overall model but they may be more specific to the measure we can use because you can see for example what the hospital might program might increase spending in the community and decrease spending in the hospital or vice versa that could definitely be it so I just think we should actually allow the hospitals to figure out how are they going to measure the success of their program without just saying well of course it's just going to be measured by this these 20 measures because it may be there may be other ways to measure their success and I think we should give them an opportunity to do that and have them think about it ok sorry that makes sense to me I think as long as I just want people to really start thinking on a hospital service area level that could be hard to find something that doesn't fall within those 20 quality measures anyways and I keep being reminded of what our consultant Mathematica told us that really in any given area I should be focusing on no more than three things at a time if you really want to be successful so there there may be different focuses around the state but I would hope they would all fall within the 20 that the quality team has moved forward so we were I would look at just on that second paragraph just kind of we were on page 19 20 so this is how you change your budget from last year basically this is how you see it you can jump it so far ahead of us so I'll go back to a little quick so 14 this is about position transfers and acquisitions because there's a process that's existed and that allows the hospital to develop that separately to the extended effects of NPR and adopters have to supply with the 17 into the reconciliation of how that information is reported to us and then at 17 and 19 19 is the policy for renewing position transfers so if one happens during the year then that's no so and so forth because it happens kind of outside of the NPR and is this identical to what we used and none of this is changed and this goes back a few years 20 again hasn't changed it's about a hospital with single modifications to their budget order once it's written the process is going out 21 starts to go every CEO of every hospital and they'll never cut the sign because they're mentioning in front of board they submit their narrative to us so 21 22 is what they say they submit along with the budget to review from last year 23 is the process for which hospitals can seek a public exemption I think what we agreed to last time is to move it in the hospital budget on the 23rd of July or whenever that date is if they initially report or somewhere in there we'll let you know which hospitals meet this criteria and then you can decide whether or not you want to allow the exemption based on the number or so on and so forth maybe on one hospital and maybe a handful so it depends on who meets the criteria this allows them not to appear before the board last year because of the new board members we decided to have them all in the industry but we'll move it in this is the standard reporting on 24 for the health reform investments this is the EP from prior years and then 25 so 25 what we did this year is rather than give the hospitals a couple different sets of questions we invited the health care advocate just to give us their questions early on and submit them to the hospital in March so that this is a a lot of the questions that were asked last year we took a few with them and then the health care advocate gave us the remainder I wouldn't know because I know the health care advocates here every time we have to take this document the date on the membership change not necessarily I don't know Kevin if you want to ask the HCA to make a comment it's a particular couple of changes that you may have made we'll definitely invite them to comment as soon as it's on their letter we'll make sure so that's the end of the budget guidance same in the MTR because it's a separate conversation that's the end of the guidance part of this and if it's okay with you I'll move to again we would like to have this done hopefully by the end of the day tomorrow and then out to public comment I'm sorry Kevin I have a quick question do you ask the hospitals for a fair amount more this year and I'm just wondering in the meetings that you've had CFOs and whether there were things that were the data input that sort of decided was not usable things that we used we had three meetings with the CFOs I opened the first one with that there was data that anybody thought that we were getting that was not useful to let me know that doesn't mean it's a one-off time opportunity I would say that as you go through the process in the case of data we don't use as a decision-making process that can be a copy of the score 2020 so we'll see the changes we're going to have one thing from somebody that says hey get through this that's what I'm just curious thank you during the three CFO meetings if you go back to the notes there were many more things that we talked about including but again I don't know if silence is accepted but this is where we end up and the other way and the only thing I would say is they were concerned by the bottom of the second chart on the page one of the British chart but other than that frankly we originally had on the salary chart about $2,000 $3,000 basically but I did not thank you that's great you want to talk to my engineer? yes national public rating I'm going to talk about these charts that you have there are four paragraphs or maybe a chart I'm going to turn this over to Tom what we're trying to do is look at that point and then also look at how you can flatten out the ups and downs and create a linear chart okay and this was also these are this is just a rough linear regression data for energy and NPR and it was trying to smooth it out over the six years rolling out for the state budget so the first one you can see there's a lot of noise going back and forth the NHE which is the national health care expenditure and the power of Vermont NPR so it's a national number for Vermont it's trended out for a few years the farther you go out the less accurate it does become if we take a six month or a six year rolling average we can smooth it out quite a bit and that's where the numbers are projected to at that point so all the numbers are on the chart for a while and then the next graph is the US hospital CPI versus NPR over more noise than this one and this CPI is hospital inpatient outpatient and no UVM and they're there to use different medical costs so slightly different and then the next chart just smooths it out as a six year rolling out so here's what we're driving towards we originally came in front of the board we've been talking from the last last meeting about setting an NPR rat based on the governor's six year rolling average which is down around 2.36 percent you asked us to go back and look at some hospital data and expenditure data which we did and we tried to create again kind of a more longer period rather than just a year over a year and create a flatline for what it would look like so what it would suggest is that in 2018 we would be similar in a 3.7 where we were still below the healthcare expenditure in 2019 in the APM side we set a 3.5 on the non-future service non-future service revenue stream what we're trying to do is figure out a way to not be back at this table again next year or time because we set an NPR data counselor inflation but not utilization from most hospitals the bigger hospitals the utilization year over year is up so when we talk about the inflation period we're going to talk about one price piece we're going to talk about utilization so I would offer somewhere maybe this is just a recommendation we're going to have to vote on this today I'm simply trying to get the board to a point where we set on an NPR I think last year we were at 3.4 and we're at this table this afternoon talking about a miss of about $40 million when we take it down so we'll fill it less than that but it's still above the 3.4 that it's still above the 3.4 that it's still above the 3.4 that it's still above the 3.4 something the above the 3.4 that it's still above the 7 that it's still above the 3.4 that it's still above the 3.4 that it's still above the 3.4 that it's still above the 3.4 that was said in 2017 again in 2013 in 2018 we're at 3.4 again I can't see as many of the data that I'm saying that we're seeing that health now itenge be good this afternoon where you're not going to have a similar miss when you're not going to have a similar miss and a couple other opinions that are coming on the table. And just a straight utilization price, it's up. So if that's, I'll throw that out in the conversation. I'm hoping we'll do at least kind of narrow a single point of a week to come back on the 14th and say, here's where we think we're going to go. And your question is to pay. So are you saying those percentages are just price? No, this is expensive. So we're not at the point of public questions. OK, let me just clarify for the poor, this is all total expense. It's just total year over year spending. We'll see what's coming then. And this is based on Tom used the act. This is nothing to do with budget to budget, but it's still kind of a linear count. So do you guys? Yeah, I just had a question on how does the actuals for 2017 was 2.8% on the NPR? 1%. So where is that showing? We didn't put that in because we didn't have the other 7.4%. Sorry. This is not from the 64. And don't forget, this is a rolling six year. So again, we tried to parallel the state budget where we could change this to the individual. But this is a rolling 6, 6, 7, 6. So if you're looking for feedback, I think that's what you asked for. I do. Yeah, my feedback is that until we have health care growing half or below the growth of the state gross domestic product, I think that we're failing. Because what we have is a path towards unsustainability with the monitors already paying about a fifth of their economic dollars on health care. Until we get that under control, I think that we're jeopardizing the system more by giving the latitude for it to continue to grow at higher than that rate. So for me, I just can't see possibly going above 3% combined. But that's just my feedback is going forward. OK. I guess what I would say is for me, I need to understand how our recommendation ties back to the all-pair model 3.5% because we agree with the federal government to a goal of total cost of care at 3.5%. Cost of spending is obviously a bigger part of total cost of care. And in this process, I mean, there's lots of disconnects in this process. It's both in-state and out-of-state all-pair model. And that brick is just in-state. But I need to understand how any given recommendation fits into and would impact on the all-pair model, total cost of care. I would also be interested in potentially splitting out different percentages for hospitals who are participating in the all-pair model and moving more towards a fixed budget because I think that's more predictable. And it allows for greater likelihood of cost containment. And if others were interested in that, where I would be heading with that is pushing down on the fee-for-service NPR and being more generous for folks who are agreeing to change their business model to add predictability and stability. Other board members? Yeah, I'd like to add to what Robin said. One of the requests, Andy, you guys were still working out with something I had sent over, which is if there was a 3.5% for the all-pair model piece, what would the balance be for fee-for-service to what would that generate? And I know that varies by hospital, but first doing it in total. If 25% was going to be fee-for-service, 25% was going to be the all-pair model at 3.5%, then that by default generates what fee-for-service would have to be. So if you wanted to be at 3.5 in total cost of care, you would split up the total fee-for-service to be 3.5, right, because 3.5, 3.5, 3.5, but if you're trying to cruise into a different board. Well, except that hospital spending's a greater percentage of total cost of care than the physician spending, right? That's all right, that's all right, that's all right. Yeah, just my feedback on building a number was coming up with different components. One component being what do we think the medical trend for hospitals would be for the state of Vermont doing nothing? So just would that be at 2.8% this year, and that includes some of the community health programs? Separating that out, what do we think that trend would be? Then adding to that our community health, if we come up with 0.5, adding to that to that number. And then we talked a lot about some of the expenses like salaries and things like that, and rather than micro-manage those, push to get an additional savings, I know all the hospitals already do savings, but they have to dig deeper, because if we're gonna bend the curve on the cost to Vermonters, it really, it's a math equation. I mean, it comes up to what their expenses are as well, so then put a factor on, and I had suggested 0.25, which across the system of 2.5 billion is actually not that large of a number, and generated additional savings. So there is math to that from a medical trend, which is different than just looking at what the budget is for Vermont, 2.38 and tying to that number, because I'm just not, I wanna tie it to where everything's gonna go, because when we look at what happened this year, utilization was the big driver that drove over in those hospitals, and how does that factor into the equation? So really kind of saying, this is where we would be trending with whatever the utilization inputs are, then adding on the community health, and then pushing back and saying, we need to have additional cost savings that will contribute to driving down the number. I mean, I guess I'll just echo Robin that's oriented to some degree, and I think we need to have that tie in to what we already agreed to 3.5, backing that out, what will be the NPR that would allow us to reach that 3.5 in terms of hospital spend. I also like the idea of a different NPR for hospitals that are in the model, realizing that they're assuming some different risk and switching over to a different business model, so I can imagine generating what the base would have to be to get to that 3.5, total positive care, and then allowing for some small percentage for an additional risk if you're in the ACO model, and then on top of that allowing for the health reform investments. I also wanna, and I know we're asking for in-state, out-of-state revenue, but we don't seem to be doing anything with it in our NPR guidance, and to the extent that really what I'm most interested in making sure that we're containing is fee-for-service in-state revenue, yeah. So how do we really carve out fee-for-service in-state revenue? So when we asked for it in the presentation, we were a little inconsistent last year on how we treated in-state and out-of-state, and I'm not sure we had a very good definition on the vast end, or if they wanted guidance, if they wanted, and we've created this revenue, if they wanted an exception for in-state and out-of-state, they have to commit with something more, I think, than a pie chart, that says this is in-state and out-of-state, that's the one that's out-of-state. I think they need to commit data that suggests we can track payers by zip code and pay, I'm sorry, patients by zip code and pay, and then you can make a determination that's truly an out-of-state payer, okay, all of that, I think that's the side. I think that's the way you should go. So hold them to the 3.5 in revenue numbers, or come up with a hold them to the NPR growth, and then if they can even say, well, the 10% of our is out-of-state, we calculated that based on the following calculation, and there wasn't consistent feedback from the hospitals on how they actually calculated it, could calculate it, or will calculate it, I think, in order to make an exception like that, to burden them on the community with proposals, and then you can say, or the team can say, yeah, okay, so three, or whatever the number is on top of this amount there, that's your NPR grade, plus the out-of-state from the NPR grade. The way that's gonna look though, is total hospital revenues, if 20% is from that state, you don't set any kind of cap on that, and say it grows at 10%, but the other 90% grows at your NPR, when you publish your NPR, it's gonna be a much higher number than the number you approve of that standard. Better than that, but that's, so I think we did put it back on that and come in and make a case of this. Just think it's gonna be a little tighter than that. One other thing we need to talk a little bit about is how do we address the hospitals that are way under their budget numbers, and is there NPR based on that, or a lower number when we track to that, because we had several hospitals, two hospitals that were over 10% below their year-over-year, and then the same thing is gonna happen this year, because we're kind of continuing that cycle going from budget to budget, whereas we've talked about maybe they somehow get a lower number in there. Well, what we'll do is we'll go back and take, as a system, take out the ACO revenue, put those kind of in a bucket, and then below that will be fee for service. We'll indicate what the ACO revenues are gonna grow, and then make a recommendation. So if we say we want the total revenue to grow at least around 3%, you know, the ACO revenue is going at a higher rate than that, the fee for service revenue can have to grow at a much lower rate than that. I'm not sure we want to do that as a service. We can take a look and see how that works, and then make a recommendation based on some of the inflators. That's the way that fee for service revenue should grow. I will mention that we received a letter from VAHS, they spoke at the last meeting, and they sent this to the board chair. We've posted it on our web, and you guys all have a copy of it. It's on our website, especially the concerns about setting a NPR that was, what we talked about the last time, it was 2.8%, more like 2.9 all in, with the 2.3% in the government budget was half a percent, and they're making statements about participating in a kind of inflation, and that this is the old paramount, and we have to bring this again inside our web. This is just a piece of information in this conversation. I think that one thing that would be helpful is for us to think about is whatever NPR target we have is to parse out what is due to price changes, and what is due to utilization changes. Building it that way, to some degree. Is price driving it, or is utilization driving it? How do we figure that out? So that's the reason I think we want to hear, is this trend is all in. When we talk about NPR prior to this, we were talking about basically the expression. This is what the all in, utilization trend would look like, based on the situation that we deal with. If the other one is, this is hospital, this is CPI, which is basically the same, it's a little higher. Yeah, there's a health care that's come out with the national health expenditure projections, for the nation, and it was the annual increase is 5.5% of which they attribute 2.5 percentage points to medical inflation. So that's the breakdown for national health expenditure, so it'd be interesting to think about that corollary to NPR. What is the component that's driven by medical price inflation, and what's the component driven by utilization, and particularly with our state of aging population, we're hearing about increased utilization from the hospitals. How does that affect you? Yeah, that is an important point, and I think that 5.5 and you're saying 2.5 is medical inflation, and in the current year that just passed, I think it was around 5.4, 5.5, and the hospitals were 2.8, so what's that correlation as well? Because we tended to trend, we trended under that for this year, how do we think that would project to? And just one comment on the note that Baz put forward that I know you put out there, there was a comment on, in terms of the financial stability of the hospitals, setting NPR rate too low, and that we have, in 2017, eight of the 14 hospitals have negative operating margins. I believe that six of those hospitals, when I like to check, were the ones that were dramatically under their budget, and I'm not surprised if they have a budget and they come 10% under that budget and they're spending a higher rate, they're gonna have negative operating margin related to that, so at least several of the key ones that have an issue are partially because their top line was too high to where they came in and they can't change the spending, so I appreciate that statement, but I think we need to look at which hospitals were the ones that had the operating margin issue and how that related to their underperformance to their NPR. Yeah, the other thing to think about is, depending on what the second news conversation goes, yeah, I think you have a year-over-year utilization problem historically in UVM's base, in the health and wellness space. If you were correct for that, it would insinuate that you accounted for the zero-over-year problem. It could have been a lower NPR, I don't know if that makes it a better zero-over-year problem, because we've had this base problem in UVM at least the last couple of years, so a one-ten adjustment in that might lead to a good amount of kind of what we can set the NPR, because it's a more each point. We set a 3.4, they all live with that, we set a 4 in that world, which is predominantly the utilization of it. When you think of your recommendations, you'll be right to hear very, yes. Okay, so that's it, I'll get, we will get the final draft to be hosted by the end of the day tomorrow for public comment, we attended a comment period, and we'll come back on the 14th with those public comments, final comments, and then at the final NPR recommendation, and we will be hearing from the boss on the 12th. Right. Are there other questions for Danny Steen from the board? No, but a huge thank you, because I know a lot of work is going on, a lot of work is going on in the background and thinking through and meeting with hospitals and all of that, so thank you. I would agree, and I would just like to say that I think this year's guidance does a terrific job of tracking with the all-pair model and the health reform landscape, so I really appreciate that. Definitely good, I was to every member of the team. At this point, I'll first open it up to the healthcare advocate, and from there, we'll move on to other members of the public who wish to comment or ask questions. Oh, thank you, and I first want to say I really want to thank Danny and his team, and we really appreciate the opportunity to make questions part of the hospital guidance process. I think it'll be better for everybody, it'll give the hospitals more time to respond, it'll give us more time to review the questions before the hearings, and I think it's a much better process. There's been so much discussion today, and I don't think I had an opportunity to review the exact draft that's here that I'm not exactly sure. I think I need to wait for another draft to respond to a lot of detail, so the one thing I wanted to just mention is as far as the health reform investment goes, it sounded like, so we had proposed a several-year look-back, it's been edited into one year, and I think it's really important that it's a several-year look-back period for several reasons. One of the things we were trying to get at is that if hospitals have been allowed an overage for health reform investments then, and then they discontinue the projects, then they shouldn't be baked into the base, so we want to make sure that we want to see where they've accounted for that as they've discontinued the program. In addition, I think, well, there's been a lot of discussion today, and we're in agreement that we want to know whether the projects have been successful and we're sensitive to the fact that the more the more stringent the process is for tracking success, sometimes it's too much of a burden on the project, so we wanted to just sort of get a baseline to get answers from hospitals on have you been tracking it, do you have any evidence, do you have anecdotal evidence, do you have specific metrics that you've been looking at, and then we also just think that it's important for the hospital, they're all nonprofit hospitals, they need to be sharing their outcomes, and we want to know, okay, you tried this, it was really successful, you tried this, you didn't think it was successful at all, and so we can kind of see what we should be encouraging other hospitals to pick up on, what maybe we want to see something similar done, but some changes made because we have some lessons learned from other hospitals, and then I lastly wanted to say that we did reserve the right to take back any questions that were edited out of the board's questions that we had suggested that were edited to the board's questions, if they're edited out, we reserve the right to take them back, so we may ask that question if you guys decide to leave it to a one-year look back period. Thank you. I would say it really changed in the first three years, the three-year period, 16, 17, and 18. That's what I thought it was. Okay, and then the second thing is, I know that THC hasn't had a chance to look at this, but maybe if you could just give me a heads up on where your major concerns are, I mean I can see if we can put your names in the final guidance, so we get it all done by the end of the morning. I'm going to watch. Sorry, sorry, is that a specific question? No, just a request that if you have specific things you want to see added back at least, let me know if those are, and then I can go through. Okay, that's it. Okay, at this point we'll open up the floor to questions and comments from members of the public. Just start by standing up, coming forward, and state your name, and speak loudly. Can I stand here? This is a long way out there, I'll be loud. My name is Hamilton Davis, I just write about healthcare. I wanted just, my comment is that I think that the question about the salary levels for executives on the 990s is totally important, but nobody mentioned that it's federal law, and so the availability of that information doesn't depend specifically on the Green On-Care Board at all. I think the importance of it. It does in some respects, because the availability is tied to almost like a one-year lag. Okay, but that's okay, the reality is that those salaries are available, and they're out there in a general range of it, and the importance of it lies, it's one of the most critical questions for the board, it seems to me, is whether or not the board and the state of Vermont wants to have a healthcare system that is bifurcated where you have two tertiary centers, UVM and DARK, who will have to recruit personnel in a national market as opposed to a local market. That's just one point. If they don't want to do that, then that's gonna change those numbers at the 990 level. If the second thing is that the single, I think the whole idea that not only the 990s, but the obvious need to put this together with the context which was discussed fully by the board here is critical because the single most poisonous element, if you will, factor in the political environment in Vermont over the last three years has been based on that salary schedule, okay? And getting real information out there is critical to that. It started with the Jessica survey that changed the fact base of that political debate, but that political debate still goes on. And I think that it's one of the board's failures, excuse me, one of the board's failures is, as the inability or whatever you wanna call it, to be able to communicate with the public. It communicates with hospitals, all right? They're hanging all over it on every word, but it would be very helpful in the political environment if the public, the press, which actually highly exists in the legislature would have a solid fact base in which to have political arguments. Thank you. So I would just say, Dan, that our board expert, Jessica, has testified before at least two committees, including each body. And unfortunately, because we have a bare-bones breast corp in Vermont, if that doesn't get picked up on, I don't know where to go. Can I say, yeah? Well, Mr. Chairman, I understand that probably better than most, I've been spending much of my working life in the press and it's a tragedy actually and just something we have to live with. It takes time, this is just my opinion, Kevin. The last week, literally last week, that survey was been out there for how long? A good while and talked about it and so forth. It was the first time a committee, two committees actually, on the basis of one piece of testimony from Jessica. First really began to get what that was about. That was both Senate finance, okay, which still has a bill out there based on a total fantasy about what's actually going on and Senate health and welfare. So it's just hard, I know it's hard and I don't have an answer for it. I don't know what to do either. So House Health and Welfare was given that testimony weeks before the Senate? No, I understand.  You've been in the legislature. Go talk to those people on the House of Health, they'll talk to you and see if they really understand it, they don't. We have talked to them. You think they understand it? I believe they do. The House of Health care? Listen, they were very impressed with the testimony that was given and at least from the members who were present because they were not all present, but the members' presence in my mind understood it completely. Well, you may be right. And you know this legislature way better than I do and you may be right. Are there other members of the public that wish to make a comment or a question? Sure, Mark. Mark Stanstaff from the University of Vermont Health Network. You know, more just statements for consideration. As you talk about access to care and third and next available visit, I think it might be helpful to just say what you're trying to get to. What you're trying to get to is if the person calls up the phone, when can they next get in on average, okay? And I would stress that you break that down between primary care, understanding what urgent and expressed care is because that's a specific need that we are having in this community and understand what those needs are. And then, you know, break it down to some of the specialties care. And there is an urgency on some of the specialty care types. So, you know, if there's an avenue and I'm not saying I'm a numbers person, I understand a hospital operation's pretty good, so just keep that in mind. But if there's a specific, if there's a different avenue, if somebody has that specific health need that's needed to be seen immediately because it's more urgent, is there a process that the hospital's set up? I just think that if you leave this to the hospital, she's gonna be all over the place. So, I would suggest pick some specialty cares to test the water. This is new to all of us now or all of you on how do we provide new data to the board that they think is relevant, you know, for the conversations. I will put out there that, you know, sometimes access is gonna be hitting up against this NPR target, regardless of how you do that. So, you need to be sensitive to that, okay? I mean, those aren't two linear lines that work together. A lot of times will they work against each other. So, you know, I don't have the answer for that, but that's more of a statement. Just a general comment on the ACO risk, we'll wait in the morning. At the time we submit our advice, we're only gonna have one month of data, so really for 19, the hospital's gonna be very dependent on the one care budget to tell them the numbers. You know, we'll have better information the following cycle, I think for like what Andy spoke to, but basically all of our estimates are gonna be based upon, you know, what one care tells us because we just don't have that run rate to draw our own conclusions. As you think about the split on the NPR between, you know, what I just called fee for service versus all payer model, just knowing the 18 budgets for Medicare and the commercial, that only represents nine months of that. So, you know, so when you apply that target to 19, you're gonna have to annualize that out. The other thing that I would be conscious is there are specific waivers that the all payer model got from the federal government and you just need to make sure that whatever the process says, it doesn't trip any of those because that's something that everybody signed on. A basic concept of the all payer model that I didn't hear talked about at all was the PMPM. How do we try to talk, take this back to the patient level? All of this is total spend by entity and that's a different animal that I think that needs to be regulated differently. And the all payer model is all about PMPM. So just, you know, I don't have the answers for that yet, but you know, we'll probably make some little suggestions on the investments as far as the health reform investments. Basically, I would say, you know, when this investment is made, exactly where the benefit is, I would keep it that simple. At what point do you expect to see it? That may not be attributed back to the individual entity. You want to focus on how is that attributed back to the population spent?  And then I think what I would say is when you look at all of this data, this is all actual to actual to actual to actual. Our budget process in these current targets, NPR, go back to the first budget guidance, okay, that created an NPR cap. I believe it was in 2011, okay. These percentages are applied against those budget numbers that were just compounded year over year over year. And our patients have changed, those patients shifts have changed. So there's never been any of the rebalancing done. So I just want you to know that because our budget process doesn't work like that. It takes a number applies it to budget and that can be carried back all the way back to the 2011 budget with some small changes for outside providers moving into the hospital systems. So I think that's basic. Oh, and then I think there's nothing in here about the aging population, which is real. So I would just put that out there, but generally I would think this is a very good conversation. It's nice to have this open conversation about all of these levels out. Myself as a numbers person on the salaries, I'm not gonna get into the political piece of it, but if whatever you ask for just need to be very clear on how it's calculated. So I'm speaking from a numbers person about exactly what's possible.  But so I think that words are gonna be important on what we put around those numbers. And that specific guidance is gonna be very important how it's calculated, like I said, I'm not speaking to any of the political piece of it, I'm just speaking to that. If my boss asks me to calculate it, do I have the information available to calculate it and then submit it to you accurately? Thank you for this opportunity. Thank you Mark, good points to bring up. Other members of the public, sure, Ken. Okay, Lyretop, there is an awful lot of material here and it's a little humbling to try to just pick out a couple of issues, but I'm gonna try to do that. I wasn't intending to, I'd like to focus a little bit on number four, the mental health piece. But before I get to that, I would say, don't listen to me, listen to Hamilton Davis when it comes to the issue of salaries and Mark very seriously, the political damage that's been done by not fostering at least transparency if not action. And it's an issue that, frankly, I've raised since the Green Mountain Care Board started. I think it's fair to say that the initial board was absolutely non-responsive to the issue to the point of taking no action for a number of years. So I guess we could say there's at least progress in attempting to figure out what's right. Having said that, I have to say that anything short of total transparency here is an enormous mistake on the part of the board. And I urge you, as you consider this, obviously not everybody shares that perspective to realize that this has collateral damage way beyond just the issue at hand. The issue at hand is there are no sacred cows in healthcare, but the Green Mountain Care Board has allowed administrative costs to be a sacred cow, in my opinion. It's a very bad mistake and it has all kinds of implications. Whether or not the board decides to intervene in the internal operations of a hospital is something that you'll have to determine. On this issue, I think steps should have been taken to address this issue and the failure to do so is a failure from my point of view in terms of regulation of the costs of healthcare. The salaries are just part of the cost and to avoid them or to hide them or to shade them does no good in terms of the larger issue. It's no great secret. I think many of the salaries are outrageously high and we could have a whole day discussion about how you get there. I'll just remind you that there's no sacred cows. The boards of the hospitals, frankly, on this issue have done an incredibly poor job and while they do many wonderful things, I was involved in cases where the board failed and Fletcher Allen is one of the examples. And when I had an opportunity to talk to almost every board member when Bill Fletcher was CEO there and they rallied around their CEO at great expense to the healthcare industry. So that's my commentary on the transparency around salaries and as we switch over then to number four, which was the mental health piece, part of this discussion is not only about healthcare and hospitals and costs and projections and transparency, but it's also redefining and defining the role of the board. And this is an incredibly complex one, but it's evolving as we discuss these matters. And I think that this kind of document is in a generic way a good step in the right direction compared to three or four years ago. And I think that that should be recognized and appreciated. Having said that, let me just make a few comments about a couple of the questions on number four, which regards mental health patients. So starting on a positive note, the fact that there is something mentioned about mental health obviously as a person who spent a lot of decades working on that issue, mostly in the legislature, is a positive thing. But I have to say that you are the czars of healthcare now. You have enormous power, but to a large extent, there's often, I think, a failure to use the power that you have. And I'll just say that as it relates to mental health. The board over the last five years or six years has been incredibly interested in the mental health issues and the last few years have adopted the term the mental health crisis, which we've become part of the lexicon of just discussion of here, the legislature and the public. But frankly, the board has very rarely really engaged on this issue and has to some degree said, but it's really not in our domain. It's part of the public system or the legislature has to deal with it. You have the power if you want to use it to get more involved. For example, I would give is a year ago, front page story in every newspaper and every show, people sitting in emergency rooms for 24 hours for days and in some cases even weeks. And again, in some ways, I would argue very little has been done a year or a year and a quarter later. We still have the situation, frankly, because of the lack of oversight and coverage by anybody, I don't think there's anybody in this room that can tell you what the current status today is of the waiting rooms issue, other than this understanding that it continues and it's a challenge. So I think it's good that you're asking some questions as you do in number four, but I would say to the board, it's way past the time for the board to look at this and say with the hospitals, not in opposition to the hospitals, do you agree with us that anything longer than a 24-hour stay in an emergency room is unacceptable and is somewhat of a red light crisis and we want to set up a protocol to deal with that because it's hospitals, it's money, and more than anything, it's your neighbors, your family members, it's people in your community who are in this situation, if any of you had a broken leg or had a heart attack, it would be unbelievable to think that you would sit in an emergency room for 24 hours. I mean, even eight hours is very painful. So somehow I would incorporate in this question to be sure how many people in your hospital have experienced a weight of more than 24 hours to get access to psychiatric care.  Another question that I would add is what have you invested in the last two years? You've had hospital budgets come before you and I've raised this issue before. You should be asking how many beds or how many services you've added in the last two years as part of your initiative is a hospital network. We have people sitting and waiting in emergency rooms and I think it would be very useful information. It's obviously not just what's the name of whatever you've done, but how much have you invested or what is it that you've been able to accomplish and how many people have served, something like that. And I think that a harder reality is understanding the shell games that go on in healthcare and in some ways, this is an unhappy story because in some ways we're all victims and perhaps you're victims too. The operational way, the way things have really worked is that very often hospitals are at capacity. So when somebody calls or the commissioner calls or doctor calls or even a legislator calls and Central Vermont says we have no beds, Central Vermont Hospital in responding to your questions will say, we don't have a waiting, we don't have people waiting in our hospital.  And then there are cases where hospitals don't want to deal with some of the acuity levels of patients that are being projected. It's an issue that has been true for a number of years but nobody really has jurisdiction to deal with it. And it's hard to get a hold of that and I don't think these questions are easily gonna do it and it might have to be some case studies. Everybody seems to say mental health is the number one healthcare crisis in our state. You have the power and waiting on the legislature, I know how things work, but it's time for somebody to take an issue like this, like mental health and say we are going to be more determined in fixing the issues. And particularly when it pertains to the hospital, you can ask more probing questions as you do this survey and I hope I'll draft some questions to take a look at. Thank you. All the members of the public who wish to have a question or a comment, am I missing anyone? Okay, with that I'm gonna recess the meeting till one and we'll be back this afternoon. So we're gonna get started, get a team from UDM and get them to set that table. We're gonna introduce this on the matter, right? Yeah, sure, yep. Never, never, we can never hear you again. So what we're gonna hear from is UDM, the health network is starting in their overage in 2017 on our actual versus the NPR that was set in the budget guidance. So we're on the agenda I think from one to two and I think that you're gonna hear the response or recognition of the questions that we sent them after the board meeting a couple weeks ago which are posted on our website and the problem will be due across the ocean right now. John, the floor is yours. Thank you. John Bromstead, the president CEO of the University of Vermont, the health network and CEO of the Medical Center in Burlington surrounded by our finance guys. So if the questions get deep or technical I will be pitching them left or right. And thank you for the opportunity. We were here a week and a half or so ago when Mr. Toledo ran through the results through 2017 for the whole Vermont health system and we were invited back to go in greater detail than the analysis that we presented on January 31st. So I believe as Mr. Toledo just said we'll answer most of your questions. We'll try to get through this in an hour of the time for the questions. We'd like to point out that we have Eric Miller, Eileen Whalen, Jen Bertrand and Fred Niffin from the University of Vermont Health Network affiliate organizations here. And again, if there are operational questions with your permission I may pitch it to them. So here's what we thought we'd do with Ties Loosley with a narrative we put in on January 31st about how much people died on the University of Vermont Medical Center briefly touched on quarter medical center's performance in 17 center Vermont's performance but really do a deep dive on the medical center again as pointed out a week and a half ago just from a scale and the amount of variance to budget in actual dollar terms. That's really what the discussion is. We want to take a step back and review how we develop budgets at the University of Vermont Medical Center. There was some question about the fidelity of the process that we go through so I'd like to touch on that. And then do much more of a deep dive than we did in that narrative on the factors that demographic factors largely that are out of our control that are driving the utilization I think type back directly to what we see at the whole system level. And we certainly will make our recommendations explicit. They're just that recommendations. So, Delta Bright End Quarter Medical Center is coming up on their one year anniversary being part of the University of Vermont network family. You can see that historically going back to 2010 they've actually been significantly under their new projections relative to budget in 2017 was the first time in since 2010 that they actually went over, was present for the budget presentations for 18 and you appropriately as the board pointed out the dramatic change in improvement in the management at quarter. One year just not a trend make. There's still lots of moving parts there including the fact that they are participating in all three of the at risk programs and we believe given the constellation of events and the data that we have in front of us that we can commit to quarter being coming into the commercial rate increase that's right around medical inflation no more than that and we'd like to see them have their margin target hit several years in a row so that we can get them to a trend and not just a one year happening. Center Vermont were essentially, would like to recommend the same thing but it's a very, very different story. They were in the midst of a leadership change through this year and their revenues actually were over budgeted by close to two and a half million but they suffered an operating loss and when you look at that relative to their budgeted margin a significant loss of 5.6 million dollars and that obviously to anybody that's tuned in speaks directly to an expense issue and things loosely managed. Anna Nunin was brought in as president, COO in May and they're actively engaged in turnaround efforts. Two examples, they have engaged Visient to come in and do a cost center by cost center productivity review and that's cross hospital, hospital outpatient they brought in a group that's very expert in looking at physician practices and they're reviewing the physician productivity, the ADP productivity and the efficiency the structure of the practices and so we'll have both of those for to inform the 2019 budget. They also are in the midst of all of this stepping into the risk world with us. They're in all three programs and percent of Vermont we believe that a proof course is to give them time give us time to sort through the operational and clinical issues and we would commit to having a commercial rate increase no greater than medical inflation. I think it's important to stop at this point and put this in the context what we're gonna talk about for the UVM Medical Center the context of the entire Vermont system and how we did in 2017. This was pointed out by Mr. Polito only four organizations, three of which are UVM Health Network organizations were over their revenue targets. The rest of the presentation deconstructs that and compares that to national performance. I would say that if you look at the bottom line with all of the moving parts that we do have control over the things that we've watched as far as programs collectively and the things that you're gonna see about the demographics that are not within our control that coming in within 1% at a system level is remarkable performance and I think the regulators and those being regulated can take a lot of pride in that accomplishment. Anybody that believes that year in year out we can do better than coming within 1% of what the targets are honestly just don't have experience in budgeting or particularly budgeting in healthcare. So at a system level we're doing well and I think that what the question that was asked of us is why the University of Vermont Health Network organizations are the ones that are positive in this family of organizations. I want to take a brief step back and talk about our budgeting process at the Medical Center and you can, this budgeting process is the same one that's used at the Center for Vermont and budgets are built from the bottom up department by department which makes in the Center for Vermont's case very important to do that productivity analysis. Really critical, the next slide will go into the specifics of this. We build our budgets four months October through January of actuals and that's what we extrapolate forward. That's pretty much what we have. We also look at prior years. We look at the year to date actual annualized that's what we have four months of. The prior calendar year and a rolling 12 months and then there's multiple levels of managerial and governance review through a finance committee that's at the network level and ultimately the network board approves the budget that we submit to the Green Mountain Care Board. So here's the development of the 2017 budget and not seeing a pointer but the in-degree are the data elements that were available to us when we crafted the 17 budget. So fourth from the left are the first three months of annualized and these are for inpatient discharges but if you take any other measure of utilization outpatient services, RVUs for the practice they follow this exact same trend. If you take the next one over that's actually we added a couple of months and we're still at the level of emissions that you see and then the check back on the calendar years is the next one and rolling 12 months that go February to January of 16 and then in the blue is what we budgeted. So you can see that that's totally in lock step with what all of our predictors and our predictive modeling and what the way we've been building budgets for a long time would lead us to those utilization measures and then you see what actually happened from March on through the rest of the fiscal year in 16 there was a dramatic increase and that flowed forward into 17. So that's the budget process and how we ended up with the budget figures that we did come up with inside of team. That's been a three year cycle where we've gone through the numbers. How do you end up at that point there? Well I can let Mark weigh in on this but it's the same thing that we did see and we brought to the attention in 2015 and in the 16 the big jump from 14 to 15 and so we brought that to the attention and there was some attention paid to that as far as dollars that flowed back into the community and some rate but this is the same process that we've been using and as you'll see there are clear drivers behind why the utilization keeps climbing in this region. I don't know Mark if you have a comment. I think the primary story here is to understand is the primary driver of the variance that we saw on the previous slides is all related to use. This is new information that came available after our budgets were submitted. This growth trend happened in a six month period from March on. So this is the same trend that happened the year before and the same trend that happened the year before. We're happy to look at other budgeting methodologies but where I come from you budget what you know and look back on actual is the closest that you can get what you know no more than we could anticipate the decrease from 2013 to 2014 to the increase to 2015. So I mean and the key here is this is done at the bottom of the people that are closest to the patient contact and there's checkpoints from the top down. So I mean I think this is the best job that anyone can do we know given the complexities and this is new patient volume that came up after the budgets you know. So let's talk about drivers for that new patient volume. The Vermont population track from 2010 to 2016 largely but certainly didn't grow. And population increased in only four counties. And I'd point out that those counties are in the primary catchment area of the UVM medical center as a community hospital and all of this growth will be captured in use of the UVM medical center as a tertiary and primary care center for these folks that are in Northwestern Vermont. So this is shipped in county by county population obviously to the left those counties are decreasing by those percentages in population and to the right those are counties that are increasing in population. And that's resulted in direct correlation more people accessing services at the UVM medical center and the bar graph on the left, the horizontal bar graph on the left is the same one as before on the previous slide only as actual numbers not percentage increases. And interestingly we saw that in each of the years along with the population and demographic shifts we've seen increased unique patients treated at the UVM medical center. And this says to me again a week and a half ago when we had the second half of the meeting was on access we're being asked to see many more patients were swimming up a very swift current but we're actually making some progress against that current and it's still not enough. Okay, so put this in that these demographic shifts and these use rates are not just gonna magically and mystically go away. So more patients shifting to the primary catchment area we all know as well that the amount is aging and there's a direct correlation between aging and utilization. If you go to the bottom line to the left in the blue is the under 55 population statewide shrinking by 30,000 and go to the right in the orange and that's the 55 plus that is growing and you can see the impact in virtually every, in every county in the state including those in our primary catchment area. So take away here more patients in the primary catchment area aging statewide and to go to a national slide just to state the obvious that the older we get the more services we use. On the left is the share of the population based on age brackets. So the green and the blue added together are the over 55 nationally, so that's 28%. And then the share of the cost of care on the right and you add up the over 65 and the over 55 and that's 38%, 28% using 58% of the healthcare spend and the cost for caring for folks 55 or older is 2.4 times. And this is a place where it's not good to be in first place for a whole host of reasons. We're tightly main for the state with the highest percentage of a population that's 55 and older. So this is a driver. Those folks, us folks use more services and more intensive services. This is what we see at the trend, the UVM Medical Center and the blue is 2013 actual and the orange red is the 17 actual total case mix index. Just growing up a tenth of a point doesn't seem like a lot but in case mix index that is a big driver of cost because that really is the measure of how sick people are, it's their acuity. And if you pull out the real driver here which is the Medicare only which is the next set over significant increase and that translates into the folks are longer stay in the hospital which again directly correlates with cost. And so we're faced with more patients, they're older in our catchment area but we're also the catchers met only in state tertiary and quandary care centers. So we get the influx from a big chunk of the state for the tertiary and quandary care. As these shifts happen and we're seeing more and more patients, my chief quality officer DNA goes to, with all that increased activity, how are we doing from a quality and efficiency perspective, we certainly don't want those things to erode because we're seeing more patients. And so here's some measures of external validation of how we're doing, delivering value, quality access over cost. Vizient which is the academic and academic health system trade organization nationally as a very empirically derived quality survey and do every year, our medical center has been in the top quartile for the past seven years and a number of those years we've been in the top decimal. You all commissioned a study from Optimus that used the all payer or the all claims database and those data you published a year ago showed that there was lower per capita costs in the Burlington hospital service area that we had the lowest spending by commercial payers on a population basis and the lowest use of inpatient services. And again, back with how the system did in 2017 from a patient service revenue perspective, we all should take a bow for the performance yet again of the healthcare delivery system. Very well done, repeated every couple of years studied by the Commonwealth Fund, very well respected. Vermont has been first during the top two or three with Hawaii and Massachusetts as long as I've been following this report. So from a quality and efficiency perspective with external validation, we feel that the increased volume has not diluted our ability to really deliver value. But the medical center, we're focusing on that but I believe that in Central Vermont and Porter as well. So let's jump to national and the first thing to point out is how Vermont hospitals are managing costs and you cannot find, at least we cannot find, benchmarks or ways to study how we're doing nationally with budget to budget or budget to actual comparators. You have to do year over year actually what happened. And that's the metric that we would follow. And on the left of the screen is a bar graph and the blue is the Vermont hospital system 14 through 17 and the orange is national and this is healthcare spend, the combination of price and use. And you can see that the blue bars are lower than the orange bars. So we are actually, our spend is not increasing greater than the rate nationally quite the opposite. If you go to the right, the orange bars on the left are deconstructed so that the total spend is broken down into the blue which is the price increase and the orange which is the use of the volume increase. And you can see that the 4.2 and the 5.7 are the same on the left and the right. And what this shows clearly is the same thing that we're experiencing. Volume is allowing us to buy down price. Volume increases are allowing us to buy down price. So how does that translate closer to home and relevant to this conversation? In the blue is the whole Vermont system. In the green is UVM Medical Center. Orange is the national trend. And you can see again that the Vermont total system seems to do well. We don't have the 17 national but everything that we see is that it's probably higher than 5%. And I think CMS is definitely coming in in that range. But you can also see that the UVM Medical Center again back to the value. We are spend increases year to year actual to actual our trending under national it goes back and forth whether we're under over the Vermont standard. I'm not going to compare it to national. I mean, wouldn't we need to look at the population change there as well just to get within the state of Vermont because the trend national is going to be higher than the state. So that would be one reason why we would be back down there. I would think that the trend nationally would, you wouldn't see the aging factor and you really shouldn't see the shift in population factor nationally. It all sort of comes out of that level, but I'm interested. Yeah, I don't think we would see it. I agree with you the aging would be the same, but in Vermont we're showing it down in population growth and in the country we're showing the increase in population growth and then you could factor into that aging. I mean, it's great to be under, I'm not saying that, I think that's a good sign. I could just say they're not necessarily apples to apples because the population of the country's growing we're going down. So that's one of the reasons that you show why the medical would be higher than the rest of the state because population is changing. It would be similar to. I absolutely agree and it gets into trying to find the right benchmarks and comparators. That's why we tend to use a family and not a comparators and not just a single one. Clark says we can get that. We can share with you all of this, Dan. So. Sure. In response to that, because I think the other factor then if you look at the national population, you really want to be looking at the insured population and Vermont's uninsured rate is much lower than the national uninsured rate, right? Because the national health expenditures are going to be impacted by that as well. Yes, but it may actually work just the opposite because the higher the insured, the higher the use rate. Right. And we also have that information. So this really gets back to the medical center in the 2017 actual to budget summary. Just looking at the top line numbers, the patient service revenue for the medical center was $38.3 million above budget. The other revenue was $10.5 above the expenses were taking care of more people, $28.2 million above. And just doing the simple math, a margin of 20.6, and I'll take you through briefly what actually related of that 20.6 back to the patient service revenue. But if you jump back to the patient service revenue, as we've talked about, 26 million of that, 38 million is Medicare. Vermont Medicaid actually was under by close to 3 million, 8 million out of state Medicaid. So if you put Medicare out of state Medicaid together, it explains 90% of the patient service revenue overage. You go increase over budget for the major commercial payers of 17 million and then increase in bed that charity care to take that out and that deconstructs that 38.3 million. The takeaway is vast majority out of state Medicaid and Medicare. Other revenue is 340B program. Expenses against the 38 million, close to 30 million was related to direct care expenses, that longer length of stay, increase case index and just the gross increase use rates. We've talked at our budget presentations last couple of years about moving into the world of taking financial risk and the prudent way to do that is to mitigate and reduce all other risk that we face, particularly on the balance sheet. And so 16 million pension liability was reduced directly to get us into shape to be able to take financial risk. And actually all other expenses were positively and well managed. And I'll take you to the lower right hand corner and we can come back to this if you have questions and I probably would punt to Mark or Todd on that. But of the net patient revenue or the patient service revenue overage, 8.6 million of that actually flowed to the margin. And again, I'm kind of a task master but that degree of closeness to what we thought we were gonna have happen, it even satisfies me. Thank you. Good budget. So that's the actual to budget summary, it's out of team. So quite a flip, I thought that was a good question. The first NPR 38.3 million, does that mean that your out of state commercial was either under budget or right on target would that fall into the minus 10 out of state commercial? Because I didn't notice you didn't break that out. Yes, the majority of that. Majority was under budget probably. Sorry, but not related to that. I mean, that is a bucket of many different things and that's presentation.  I think we saw our out of state commercial rates coming about on budget. There was a budgeting convention item, I think that drove the majority of that 10 million. We talked about that separately. That's really getting to the details. Okay, thank you. So again, we jump up to the whole Vermont system in 17 and look at where the patient service revenue came in different than the overall budget by payer. Again, very much a Medicare story and the commercial essentially came in exactly on budget. Remember the whole revenue is 2.4 billion. So coming in that close. And concerning to me for our whole system is that even with a slight overage, 100% overage in patient service revenue, the margins at a system level were under water, which I think deserves some scrutiny. So if you remind the board again, what was the exact amount of that commercial for what we have on this? 17.2 on the previous slide. There was a press story that ranked premiums by person, by state, Vermont was in the top five. And you could explain that if we had the, we were in the top five of the lowest deductibles over the warrant. So what is driving Vermont to be at the forefront of insurance rates in the country? Caution, underfunding is a Medicaid program. So when you have somebody from New Hampshire or from New York, isn't it true that if somebody from New Hampshire comes in that you could even less than somebody from Vermont for Medicaid? Yes and no. So because we live in two states, New York and Vermont, one of the things that we've done is we started to do comparatives of the Medicare, Medicaid rates as well as the commercial rates. And what you find is that you would assume that Medicare reimbursement would be consistent between the two, but there are variables in there that compensate in different ways. Medicaid to your point, I would agree that New Hampshire pays a lower percentage of cost than Vermont does. New York is kind of closed, it's not quite as bad as New Hampshire, but the commercial fluctuation tends to bleed in different ways. So we are seeing similar patterns across the different states, but the allocations between payers some offset each other to a degree. So within... You're higher than our neighbors to our east and our west. How do we rank overall as far as Medicaid reimbursement compared to the other states in the country? What would you rank there? I have to get a recent study, I haven't seen one in a while, but we would all be, the Northeast is notoriously for being in the lower quartile. And when I say that, New England and New York state. And I also would just throw in, it's a, the out of state Medicaid is almost totally New York. I mean, there's very little New Hampshire volume that gets to us, not the same as the very large amount for my healthcare dollars that flow east into left-wing New Hampshire. So there is this $38 million of revenue above budget in 2017 what's happened after the 17 budget that is having and will have an impact on patient service revenue in 18. Things that have happened since we put the 17 budget to bed that will have an impact on patient service revenue in 18 year we're in. And I have to start with the mental health story significant increased costs with caring for people appropriately that are in our emergency rooms with mental health issues and are there for significant periods of time, five and a half billion dollars of increased expense to care for those people appropriately. And the length of stay with virtually no increase reimbursement whether they're in the inpatient or whether they're in the emergency room is directly added costs. We are like Center Vermont and Rutland looking at restructuring our emergency room so that we can provide at