Health Care

2nd-largest hospital in Vermont asks regulators for double-digit increase in charges

Rutland Regional Medical Center. File photo by Emma Cotton/VTDigger

Days after the largest hospital operator in Vermont asked regulators for hefty budget increases, Rutland Regional Medical Center is following suit. 

The independent community hospital has asked regulators at the Green Mountain Care Board to allow it to increase charges on commercial insurers by an average of 17.8% in fiscal year 2023. The fiscal year begins Oct. 1 and runs until Sept. 30, 2023. Rutland proposed a $313.9 million budget for the next fiscal year, a $43.6 million increase from the current fiscal year.

If regulators at the Green Mountain Care Board approve Rutland’s budget request in full, consumers with private insurance could see significant increases in their premiums next year. Without the increase, however, hospital leaders warned that Rutland would be “forced to curtail our services,” according to the hospital’s proposal. 

Claudio Fort, Rutland Regional’s president and chief executive, said that Vermont’s hospitals are under extraordinary pressure from inflation and staffing shortages. The Rutland hospital is facing a projected $25 million deficit in fiscal year 2023, including a $12 million loss from operations, according to its proposal to the care board.

“Our budget and rate request reflect the need to stabilize our financial situation and ensure that our community continues to have access to these critical healthcare services,” he said in a statement. “We look forward to discussing the budget in more detail with the members of the Green Mountain Care Board later this summer, and do not want to pre-empt that process with further comment at this time.”

Earlier this year, Rutland Regional and the University of Vermont Health Network petitioned the Green Mountain Care Board for mid-year rate raises to help with budget shortfalls. Regulators granted the health network a modest increase but denied Rutland’s request. Care board members said at the time they would consider an increase in the context of budget season, which kicked off Friday when all of Vermont’s 14 hospitals submitted their budget requests.

Most of these budget requests are not yet public, but other hospitals are expected to ask for significant raises to their budgets because of pandemic-related inflation and staffing pressures. 

Members of the Green Mountain Care Board anticipated some increases this year and higher overall growth targets for hospitals. Normally at 3.5% a year, the overall allowable growth rate is 8.6% over the next two years. That rate relates to the commercial charges that hospitals stipulate in their proposals.

At 16%, or $43 million for fiscal year 2023, Rutland’s overall proposed growth rate is almost double what the board allowed. 

The commercial rate increases that UVM Health Network requested in its most recent proposal correspond to 10% growth for the University of Vermont Medical Center, 7.3% for Central Vermont Medical Center and 10.6% for Porter Hospital in fiscal year 2023. 

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Liora Engel-Smith

About Liora

Liora Engel-Smith covers health care for VTDigger. She previously covered rural health at NC Health News in North Carolina and the Keene Sentinel in New Hampshire. She also had been at the Muscatine Journal in rural Iowa. Engel-Smith has master's degrees in public health from Drexel University and journalism from Temple University. Before moving to journalism, she was a scientist who briefly worked in the pharmaceutical industry.

Email: [email protected]

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