Vermont Legislature SmartTranscripts:

[Speaker 0]: Good morning. This is the House Appropriations Committee. It is Thursday it's Wednesday, sorry, 01/14/2026. It's just about 10:45 in the morning. And next up on our agenda is a conversation with folks from the Agency of Human Services about the implementation and impacts of HR1, which is the federal bill that was passed last summer. So not to be confused with the continuing resolution, which is the result of the government shutdown and that expires on January 30, but that may still be playing a role in what you all are talking about. So anyway, we're delighted to have you. We'll go around and introduce ourselves, and then you can introduce yourselves and go after the presentation. So thanks.

[David Yacovone (Member)]: Welcome, I'm David Yacovone. I represent the Lamoille Washington District.

[John Kascenska (Member)]: Welcome. I'm John Kascenska from Burke. I represent 10 towns in the Essex Caledonia District.

[Michael Nigro (Member)]: Hi, Mike Nigro. I represent Bennington and Powell.

[Thomas Stevens (Member)]: Thomas Stevens representing Washington Chittenden.

[Martha Feltus (Vice Chair)]: Martha Feltus from Linden, Caledonia 3. Robin Scheu from Middlebury. Tiffany Bluemle from South End Of Burlington.

[Michael Nigro (Member)]: Wayne Laroche, from Kate Franklin, Berkshire,

[John Kascenska (Member)]: and Rich Group. Good morning. Mike Mrowicki. I am the stake rep from Windham Ford District Of The Intramurst.

[Eileen “Lynne” Dickinson (Member)]: Hi, I'm Lynne Dickinson and I represent St. Aldis Town.

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: You, glad to have you here. Thanks so much. I'll introduce myself and then pass it to you since we're going to start the content. My name is Addy Stromlo. I'm the Deputy Commissioner

[Martha Feltus (Vice Chair)]: at the Department of Drug and

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: Drug Access within the Agency of Human Services.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: And I'm Ashley Berliner. I'm the director of Medicaid policy for the Agency of Human Services. And so I'm sharing slides. You have the slides in advance as well. But today, we're really here to provide an overview of H. R. One, which is the big, beautiful bill that was passed on 07/04/2025. And it has many major provisions that impact Medicaid and the larger health care system. We're not going to go through every single one of those provisions today. They're numerous. But we're really going to focus on the ones that have a direct impact on our operations and budget here in Vermont. So specifically, going to talk about Planned Parenthood funding, provider taxes, state directed payments, cost sharing. And then I'll pass it over to Addy, who's going to do a little bit of a deeper dive on the eligibility provisions and what's going on. Please feel free to interrupt at any time and ask questions. I'll take the questions. Sure. Okay. So the very first provision to go into effect under HR1 was a provision that barred Planned Parenthood and Planned Parenthood like entities from receiving federal Medicaid reimbursement for one year, so from 07/04/2025 to 07/03/2026. We have approximately $1,100,000 in gross, both state and federal share Medicaid costs going to Planned Parenthood in Vermont. And we have made the decision to backfill all of the lost federal financial participation with state general fund. So approximately $600,000 for one year is what we're

[Speaker 0]: backfilling. And we should remind people that Planned Parenthood is the primary care provider for something like 16,000 Vermonters. So that's really a lot of what we're talking about here is the primary care services, not other services that people always associate. They tend to only associate. They do much more than

[Ashley Berliner (Director of Medicaid Policy, AHS)]: That's right. It is absolutely a safety net provider for a large portion of the Medicaid population here in Vermont. And in fact, abortion funding is not ever allowed under Medicaid program. So that's off the table here. We're talking about primary reproductive health. Yeah. Okay. Thank you. You might be hearing in the news, there is ongoing litigation around this specific provision. There have been a lot of on off injunctions where there have been pauses in the bar on federal Medicaid bans. There have been reinstitutions of the provision pauses again. So right now, because it's still working its way through the courts, we are just waiting on a final court decision before making any changes. We're not toggling back and forth between general fund and Medicaid and general fund. Or just sticking with general fund, if the final decision says that this provision is not legal and is overturned, then we will go back and recoup federal claims. Provider taxes is another pretty big provision under this bill, and it comes in multiple parts. So effective on the passage of this bill, there is a prohibition on the creation of any new provider taxes. Additionally, starting November 2027, there is a requirement to reduce existing provider caps that are a six percent cap. Reduce existing provider taxes on hospitals by 0.5% per year for five years. So starting November 2027 going through 2032, there is a requirement to step down that hospital provider tax 0.5% per year. That has about an $18,000,000 general fund impact per year. Cumulatively, over the five years, we're looking at an $87,000,000 per year loss in general fund. We're really digging into this issue to understand what levers Vermont has, what we can do to protect ourselves from this loss. And right now, it's not a this year budget problem. We're really just trying to explore talking to all the right people and want you to be aware. Great. And Mike has a question. Sure. I

[John Kascenska (Member)]: may not have this right, but I think the provider tax was used to access money other funding. How is that going to be impacted? Do we have to come up with all of it then?

[Ashley Berliner (Director of Medicaid Policy, AHS)]: The provider tax revenue is put into the general fund. And so the general fund is allocated to a variety of ways, as you know. Some of it surely is used for the Medicaid program and draws down federal match. To the extent that it's general fund that hits the budget and would impact Medicaid, we would also be losing that federal match. But it's not a one for one. It's not a direct tie to Medicaid rates. Since it goes into the total pool? Yes.

[Speaker 0]: And may or may not. Dave?

[David Yacovone (Member)]: 18,000,000 GF, do you have an estimate of what the gross impact is of the loss?

[Ashley Berliner (Director of Medicaid Policy, AHS)]: Well, the gross impact is $87,000,000 in general fund. Over five years or one year? No, per year, starting in 2014.

[Unknown (Legislative Fiscal/Staff)]: Okay, so a

[David Yacovone (Member)]: loss of revenue to Medicaid of $87,000,000

[Ashley Berliner (Director of Medicaid Policy, AHS)]: No, a loss of revenue to general fund. So this is not a Medicaid. It is under the Medicaid provisions of HR1, but it is a revenue source for the state budget. It's not a revenue source for the Medicaid program,

[Unknown (Legislative Fiscal/Staff)]: if that makes

[Ashley Berliner (Director of Medicaid Policy, AHS)]: sense. It just goes into the general fund, and it's part of the general fund dollars that you allocate. Well, we

[Speaker 0]: could figure out I have a long list of people who want to talk. We could figure out, Dave, if we were going to use $18,000,000 of general fund for match, what does that get us? That's kind of what you're asking. And doesn't that depend on what the match is for?

[Ashley Berliner (Director of Medicaid Policy, AHS)]: And if you were going to try to match $87,000,000 it would equate to about $211,000,000 per year

[Speaker 0]: of your match.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: But again, it's not a one for one. It's not a direct tie. And that's actually worth stating. In most other states, provider taxes do have a one for one correlation to draw down federal dollars, which is why this was targeted in this bill, because the federal government saw this as a way that it was increasing their budget expenditures by just states ramping up that provider tax and then directly depositing it into rates and holding them harmless, the providers paying the tax harmless. That is not what happens in Vermont. There is not a full harmless. It's not one for one. It just goes into the general fund revenue. So that's a real difference in Vermont than what's happening in the rest of the country. So I have

[Speaker 0]: Sean, Tom, Lynn, and Wayne.

[Thomas Stevens (Member)]: There we go.

[Michael Nigro (Member)]: Why don't everybody ask

[John Kascenska (Member)]: you several questions from us, just so we better understand. So hospital pays their provider tax. What percentage of that is not used for health care purposes?

[Ashley Berliner (Director of Medicaid Policy, AHS)]: We don't have any insight because of the way you guys build the budget. This is just a revenue source into the general fund like any other revenue source. I you and I talk

[Speaker 0]: about that. Let's jump in here.

[Unknown (Legislative Fiscal/Staff)]: Director Normand, I want to clarify a little bit. So we used to have this fund called the State Health Care Resources Fund, and in that fund we put the provider tax, employer subsidy, claims and substance, premiums for Medicaid, and part of the tobacco tax. Several years ago, the bonding agencies said to us, you have no general fund. And we said, sure, we have all this big funds. But no, but you don't have any general fund, you have all these special funds. So we started putting money from this big fund, general fund for bonding purposes. Much of the state healthcare resources fund went into that. So Ashley's blame. Now it goes into what I like to say, giant pond. And so you're pouring water into the pond and you're scooping water out of that same pond, but it's not necessarily that dollar. And so what Ashley is trying to do is strike the balance by saying, I can't say that this dollar goes to this. But, and to the next point, okay, so if we have 18,000,000 or $89,000,000 less than federal fund, sure, the federal government is doing it because they assume states are going to cut Medicaid programs to save the state of federal dollars. But, going so good.

[Martha Feltus (Vice Chair)]: The match. Sorry,

[Speaker 0]: we'll come back. Well, we'll come back to you. Thomas has for now. Lynn, then Wayne and Marty.

[Eileen “Lynne” Dickinson (Member)]: Okay, last year, I don't know if it was you guys or someone else, I think came in from Diva and they said something when the provider tax came up, I think they said something like we collect $200,000,000 in provider tax per year, and the match for the federal government is $20,000,000 pretty much is a 10%. Roughly those numbers. But the ratio, it was, I think the original attempt, from what I remember when I served, got involved in this stuff on the POC, was that it was supposed to be a hold harmless. That was the original intent. And then, of course, over time, didn't. I mean, we lose this money in the general fund, and we do draw down federal money for Medicaid. And I do the mixing bowl. So I see that lots of things that we do for match are important. But it costs a lot of money for our hospitals that are losing money. And it's not for patient care. It's just a gross tax.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: That correct? That it's just a gross tax? It's a gross tax on their revenue. Yes.

[Michael Nigro (Member)]: Okay. All set.

[Speaker 0]: Wayne, can you hear me already?

[Wayne Laroche (Member)]: So back on the taxing. So the money goes in strictly, not just the general funds, the way it used to go into a special fund. Not much tracking there. Is there any tracking mechanism for that?

[Ashley Berliner (Director of Medicaid Policy, AHS)]: There's no tracking, which is why I can't say this is going to be a direct impact to Medicaid. It's going to be a direct impact to the amount of state dollars that you have to play with on this committee, and we'll have to decide where those cuts come from. Again, though, I want to emphasize that we're really digging into this deeply to make sure that we understand what levers we can pull and try to mitigate this harm as much as possible.

[Wayne Laroche (Member)]: And the bonding, the bonding that's capital building bonding, capital bill bonding?

[Unknown (Legislative Fiscal/Staff)]: No, was just like the bonding agencies when they're like are you AAA or anything?

[Speaker 0]: Your ratings. Just the

[Unknown (Legislative Fiscal/Staff)]: So they were looking at that. We had all state knowledge, but they were in all the specified points. So it was an accounting purpose. And I will also say that we were just using the state health care regulations before we draw that, and we're really using strict in the amount of general fund, but it really didn't matter that we had the specified.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: The special fund is not always the answer

[Wayne Laroche (Member)]: but the bonding I mean the bonding rate only affects that money's going to be capped bill

[Unknown (Legislative Fiscal/Staff)]: no well it depends on the bonding agency between how they rate us I understand How we rate it better then yeah.

[Wayne Laroche (Member)]: The only impact is going to be on how much bonded money.

[Unknown (Legislative Fiscal/Staff)]: It's also just an accounting thing where you're like a philosophical account like we don't need we didn't need something special for us. Right.

[Wayne Laroche (Member)]: How does the captive bonded money fit in with It's

[Unknown (Legislative Fiscal/Staff)]: completely different for ratings so that

[Ashley Berliner (Director of Medicaid Policy, AHS)]: It's strengthening up our balance sheet.

[Wayne Laroche (Member)]: So disconnect though in terms of accountability.

[Speaker 0]: I think it's fine that we don't have the money in special fund.

[Martha Feltus (Vice Chair)]: I'm confused about the 18,000,000 and the 87,000,000. I think I figured it out. The 0.5 reduction each year is 18,000,000. At the end of five years, we're gonna be down to 3.5% and the 87 is the difference between the six and the 3.5? Yes.

[Speaker 0]: In year two, it's 18,000,000 and then year two, it's 36,000,000. Yes. Right, and then year three it's

[Unknown (Legislative Fiscal/Staff)]: More than that. Have a chart on that too.

[Speaker 0]: Have everything going. We're good to have that information.

[Unknown (Legislative Fiscal/Staff)]: I have a whole presentation on them for my type, ultimately how it affects them. I have a chart that shows over time how it compounds. But it was a little different.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: The concept was the same. Yeah.

[Speaker 0]: Okay. Lynn, did you have one more?

[Eileen “Lynne” Dickinson (Member)]: No, understand the eighteen eighty seven. Yeah, it's a progressive deduction.

[Martha Feltus (Vice Chair)]: And by the time the end 3.5 then that difference and the beginning bit, Right. It just takes a while to get there. Yes. Slow pain. Go ahead. Continue, please.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: Okay. Next provision to talk about is related to state directed payments. State directed payments are a term of art used in the Medicaid space that is essentially a type of payment where the states require the plan, in this case, DIBA, to pay health care providers in a specific way to achieve state policy goals. So an example of this is when the legislature directs DIVA to pay primary care rates at 110% of the Medicare rate. That is considered a state directed payment. We also have state directed payments in the form of our blueprint payments for patient centered medical homes and community health teams. Those are other state directed payments that are recognized by CMS. What this provision says is that Medicaid state directed payments are not permitted to grow, even from an inflationary perspective, and any new state directed payments must be capped at 100% of the Medicare rate. Existing state directive payments have to be reduced by 10% per year beginning in 2028 until the state directive payment is no greater than 100% of the Medicare rate. So again, not a this year budget problem. But if nothing changed, if we didn't change anything here in Vermont, this would have an impact on several of the payments where the legislature directed Medicaid to pay in a certain way above Medicare levels. We are looking at this really closely to understand what the universe is of state directed payments. We know the ones we know, but we really need to do an inventory to understand where the legislature has specified that has to pay in a certain way. Most of the time, the legislature doesn't specify how DIVA pays. They say, here's the amount of money you have, but you don't have to set it at this rate or at 110% of Medicare. So that's really what we're looking at here. And we're doing work at AHS to think about the guardrails that we can set up to get us out of these state directed payment categorizations so that we can still maintain the flexibility to set rates that align with our priorities, but don't get captured under the state directed payment provision. So we don't know exactly what that's going to look like yet. We're newly digging into that. But we're optimistic that we can figure out guardrails to still be able to have policy goals and not be captured in this hard 100% of Medicare limit. So we're not permitted to grow in terms of whoever we're paying now, are they the only people we can pay or we can't up the rates? Remind me that. We can't increase the rates above Medicare limits. Okay.

[Speaker 0]: And what are we paying? Are we around 110% of Medicare? It depends on

[Ashley Berliner (Director of Medicaid Policy, AHS)]: the program, I guess. Yeah, it depends on the program. And it's not 100 of Medicare. If Diva decides to pay more than 100% of Medicare, that's fine. It's when the legislature directs DIVA to pay. That is what gets caught up in this. Okay. So just to put an example of it, on the primary care, you said as a legislature, I believe in 2024, DIVA must pay 110% Medicare rates for primary care. That's a state directed payment because you're specifically telling DIVA what the rate must be. Instead, what we are contemplating and we haven't worked this all out yet, so don't quote me. Instead, one thing we might be thinking about is the legislature is going to give Diva this amount of money for primary care rates. And it is more money than we have today. And so DIVA can increase their primary care rates, but you're not telling them how or at what level. Just like years of money. Exactly. So we think there are ways around this, But we just need to get really straight, talk to the attorneys, make sure that we're 100% compliant. That's the most important piece is that we're compliant with this provision and then exploring our flexibility beyond that.

[Speaker 0]: And is there any assumption in here that Medicare rates will not go up? We aren't allowed inflationary adjustments on the STPs. But if Medicare rates go up, then we have a little bit of wiggle room from that standpoint.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: And if they don't go up, then that's full of assurance. I just wanted to be

[Martha Feltus (Vice Chair)]: clear. We have, in budgets, appropriated money to increase the rates that are paid to a designated agency. Then is that an SVP as well?

[Ashley Berliner (Director of Medicaid Policy, AHS)]: If you're directing how they're to be paid, like they must have rates increased by 3%, then yes.

[Martha Feltus (Vice Chair)]: Okay, Just wanted to make sure how broad that is.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: Okay. And this goes into effect No,

[Speaker 0]: that said, it already went into effect in July 4, when

[Ashley Berliner (Director of Medicaid Policy, AHS)]: they Yeah, so they're not permitted to grow. We can't

[Speaker 0]: starting math. So if we had directed on the das last year then they would still be part of the could be directed but we can't direct any to any new organizations are they just can we add organizations

[Ashley Berliner (Director of Medicaid Policy, AHS)]: for STPs or not above 100% of Medicare?

[Michael Nigro (Member)]: Right. Okay. Yes, ma'am. So, will this require potentially lot of changes? Statute change?

[Ashley Berliner (Director of Medicaid Policy, AHS)]: I think it's more changes in yes, it will require existing it could potentially require existing changes, like moving away from the 110%. In order to comply, we would have to do that. It's also thinking about the way this legislative body does its work and how you're writing bills. So I think, again, we're going to come back to this. It's not a this year budget concern, but we are going to have to have conversations about what it means when you're appropriating money to the Medicaid program and how that language is written so that we're not getting caught up in this provision.

[Speaker 0]: Lynn? Is this like a backfill?

[Michael Nigro (Member)]: No. Well, if you want amount

[Eileen “Lynne” Dickinson (Member)]: of money if you're going to appropriate more money to DIVA or whatever the program is that's dealing with health care and Medicaid and you don't want it to be in language that says, well, you have to follow a percentage of Medicare or whatever the language may be that's not allowed. Does that mean you have to put more money in so that you can actually spend that money the way you got the original one?

[Michael Nigro (Member)]: Is that what the bank do?

[Ashley Berliner (Director of Medicaid Policy, AHS)]: I'm not sure I'm understanding, but it wouldn't be any sort of a back bill. I'm not sure I understand my question. I'm sorry.

[Speaker 0]: It's Okay. I think it's a change in the way we would do the payments rather than the back sales.

[Unknown (Legislative Fiscal/Staff)]: Yes. Yeah.

[Eileen “Lynne” Dickinson (Member)]: Just want to So if

[Speaker 0]: we say, here's a lump sum, you figure out how to do it, but we don't direct them with a percentage, that could be a way to be compliant. Yeah.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: That's what we're thinking about. So we're going to come back with specific thoughts. But that's really what we want to do right now, is just educate you about the provisions on this bill and potential impact and know that we're working really hard to mitigate. So in the budget for FY27,

[Speaker 0]: we can't create any new state directed payments, nor can we Not above 100% of Medicare. So we could do new STPs as long as

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: they were just at 100% of Medicare.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: You could. I would encourage you not to.

[Speaker 0]: I'm not suggesting we can't. I'm just trying to

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: stand what's sort of allowed. But for other ones that

[Speaker 0]: have been above Medicare, 110%, if we gave them 110%

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: last year, we

[Speaker 0]: can still give them 110%

[Martha Feltus (Vice Chair)]: this year.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: They're not permitted to grow. So you couldn't make it 112%?

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: No, we could keep it

[Speaker 0]: at 110%.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: Yes. Yes. Okay.

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: All right. This is starting to become a

[Speaker 0]: little less fun. Did you have a question, John? No. Okay.

[Unknown (Legislative Fiscal/Staff)]: Not yet.

[Thomas Stevens (Member)]: Not yet.

[Speaker 0]: All right. Continue. This is such

[Ashley Berliner (Director of Medicaid Policy, AHS)]: a reversal because Addison and I did this in Senate Health and Welfare and House of Health Care. And they were really focused on Addy's slides. And I zoomed through mine. I think we're at the table. Committees.

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: We're at it. Still Still time. That's

[Speaker 0]: right.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: Okay, cost sharing. I really don't have much to say about this, except for this is a provision that effective October 2028, the bill requires that Medicaid programs impose co payments to the new adult population with incomes over 100% of federal poverty limit on all services, except for those specifically exempted under the bill. So that would be a pretty significant change in the way Vermont administers its Medicaid program. We have very, very limited co pays right now on inpatient hospital, dental, and pharmacy. Thank you. And so we would have to have a massive expansion of co payments under this bill. We are awaiting regulatory guidance. There is a lot of ambiguity in the way the bill is written. Have a lot of questions about how it would be administered, what is exempted, what's not exempted, and how much discretion the state has. So we're just staying tight until the Centers for Medicare and Medicaid Services releases rulemaking on this provision.

[Speaker 0]: So in theory, we could just charge $1

[Ashley Berliner (Director of Medicaid Policy, AHS)]: There are likely going to be certain requirements around that, which is why we're waiting to see how much discretion we have. And no sense, of course, as to when you might actually hear from them on this guidance. I would imagine we'll hear from them sometime in 2028, to be honest, because of the work that they're doing to make rulemaking on the eligibility provisions that Addy's going to talk about, they have really set up a lot of work for themselves. So I don't think that they're going to be tackling this anytime soon. Okay.

[Speaker 0]: So we're just in a holding pattern the way it is Yes. For Okay.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: All right. And then I'll pass it over to Addy.

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: Yeah, that's a great segue. So a lot of the provisions that Ashley has described hit on the Medicaid program, either financially or in capacity, in DIVA's capacity, as a health plan administering the Medicaid program. I oversee the other part of Diva, which is eligibility and enrollment into the health care programs, both Medicaid and the marketplace. So we serve as the entry point for meebles.com and get health care coverage. And this eligibility process is another one of the major levers that was used in the Budget Reconciliation Act to meet the financial targets. So a lot of the near term work is with my team and with Diva in terms of implementation over the course of the next We couple of started reviewing the bill, obviously, when it passed. And there were some small changes that we had to make even for open enrollment this past fall. But right now, we're focused on three major provisions that require implementation during 2026 for effective dates at the end of the year or 01/01/2027. And then there's a fourth for 2028 that I can talk about a bit, but that's kind of our second phase. So the first major provision in the eligibility space relates to changes to healthcare eligibility based on immigration status. This is a change that applies across the Medicaid program and it's effective for 10/01/2026. And then there's a parallel change for the Marketplace and the premium assistance that's available to people who enroll in qualified health plans effective 01/01/2027. And effectively, what this does is it will block eligibility for certain categories of non citizens, including asylees and refugees. So people who can currently get on Medicaid will no longer be able to. It's a little bit hard to predict the number of impacted members because currently, again, because it's not that prescriptive in terms of eligibility, we don't collect this level of detail on people's immigration status as part of the eligibility process. So a big part of this will be working to identify the impacted population. Our best guess, it's in the hundreds. A few 100 people will be impacted. But it's definitely a significant change to the way that we do eligibility and the population that Medicaid is available for in our state. The second major provision relates to the redetermination or renewal process. And that's that mandated recheck of eligibility that we have to do on members for them to maintain coverage. Now Is

[Speaker 0]: that the new adults? Yes. So this is specific

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: to the expansion population, which we refer to as the new adults. These are the non disabled adults who are eligible for Medicaid based on income up to 138% of the federal poverty limit.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: How many

[Eileen “Lynne” Dickinson (Member)]: people do we have in that category?

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: It's about 55,000 people. Yeah.

[Speaker 0]: Non

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: disabled adults. And the difference from traditional Medicaid is that their eligibility is based on income.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: Eligible due to income of 138%

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: or below, above, or it's 138% of the federal poverty level. Correct, yeah, or below. Or below.

[Unknown (Legislative Fiscal/Staff)]: So there are a number for that people.

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: The number of people is about think

[Thomas Stevens (Member)]: it's 38%.

[Eileen “Lynne” Dickinson (Member)]: It's on the

[Ashley Berliner (Director of Medicaid Policy, AHS)]: Well, don't.

[Eileen “Lynne” Dickinson (Member)]: It's in fact, New Sandy. The chart that says the five this is a chart, but

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: they were the federal poverty levels.

[Speaker 0]: Depends on that. So if they're single,

[Ashley Berliner (Director of Medicaid Policy, AHS)]: are they single people?

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: Or could be in a different household structure.

[Eileen “Lynne” Dickinson (Member)]: I think

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: it says 1,800 per month.

[Thomas Stevens (Member)]: Yeah, 138% for a household

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: size Monthly income. Is the one below annual?

[Thomas Stevens (Member)]: It is, yes. And so the annual equivalent would be $21,500

[Martha Feltus (Vice Chair)]: Yeah, for one person? For one person, 138%.

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: Yeah, and then there are equivalents for different household sizes.

[Speaker 0]: Right, so you can all go look at the chart, but at least we have an idea what we're talking about. That's why we put it up there, because every year somebody asks me,

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: Oh, I should know that. So this change is specific to that new adult group.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: So you

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: said 55,000? Correct, yep. It's not across the program, but it is a really significant change. Right now, renewals take place every 12. You all probably remember we paused renewals during the pandemic, during the public health emergency, and went through a really intense process of restarting that, a lot of work. Now that frequency will be reduced from twelve months to six months. So it effectively doubles the obligations, the paperwork obligations over the course of the year.

[Speaker 0]: So we have what these individuals are going to have to go through, and it's maybe hard enough to do annually, now they have to do it twice, but you all have administrative work that's doubling your work. Are you going to be having to hire more people to do this?

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: Yes. And we can maybe talk about that more in the context of our budget. But across all of these provisions for fiscal year 'twenty seven, we think it's going to be about an increase in 30%, about 30% of our eligibility work. And so

[Speaker 0]: we

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: have made some staffing projections in accordance with that.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: We'll see that in the budget.

[Speaker 0]: But I would expect it's affecting your SHOP that way. Yes. Yeah, Lynn?

[Eileen “Lynne” Dickinson (Member)]: Yeah, they didn't change the match. We call this as ninetyten match. It's going to be federal 10% state. Is that correct for this group?

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: For the group, yep. And then also for any IT associated with implementing this change, there's an enhanced match of ninetyten. But administrative costs are a lower match rate.

[Martha Feltus (Vice Chair)]: In your plans for how to manage the work of renewals, are you planning to engage community based organizations, networks that already exist that work with many of the folks who are in these programs? Yes. I think we're still

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: in the early stages of exactly what that looks like. But as I'll talk about a bit later, we're hoping to leverage a lot of the lessons that we learned in all of the renewal work that we did over the past few years, which definitely included increased touch points in the community through partner organizations, increased touch points through different modalities, through texting, website, that kind of thing. So the outreach and support portion of

[Ashley Berliner (Director of Medicaid Policy, AHS)]: this is really significant. So the

[Michael Nigro (Member)]: twelve months to six months, does EBT cards fall under this?

[Ashley Berliner (Director of Medicaid Policy, AHS)]: Is that how it's distributed? No, actually, it's

[Martha Feltus (Vice Chair)]: a separate program. Separate program? Okay. We'll hear

[Speaker 0]: more about that, I'm sure, during the FY '22. Okay.

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: So the third provision is, you all probably heard about this, we refer to it as community engagement requirements, but what they are, work requirements, which is a new standard. This one also applies to that expansion or new adult population and is also effective 01/01/2027.

[Speaker 0]: Next year.

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: Correct. Yep. Same timeline as the previous one. This requires members to demonstrate eighty hours per month of work, community service, or education as a condition of Medicaid eligibility. So a real sea change in terms of what we need to check for in order to let people in the door or to stay in coverage. There are also a number of exceptions and accepted populations that are built into the statute, pregnant individuals, those who are medically frail, people with kids 14. So taking those into account, this is still a work in progress also, But we think this change will impact about 30,000 members in terms of having an additional verification requirement or paperwork requirement to maintain their eligibility. And obviously, affects your same staff kind of thing.

[Speaker 0]: I think of the Department of Labor and your unemployment every year, if they had a better system, they could just We are.

[Thomas Stevens (Member)]: The way this is phrased, I mean, it's not a critique of how you wrote this, but just because this is just from the government, but the way that this policy was created, it's to me it creates an impression that people who receive Medicaids don't work, And that can't be true. There's many people who work, don't get access or they're already disabled and they're working at some level, not eighty hours a week. So you have an idea of how many people are, you said 30,000 people for the requirements to deal with your eligibility every six months. Is that just it just rubs me the wrong way because it makes an assumption that people who need to use Medicaid, it's because they either don't work, they don't get paid enough, or they fit under different economic categories, not just disabilities, that they qualify for this. Is that an accurate belief for me? Mean, that something that I carry with me?

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: Think that this definitely represents a change in approach to the way the Medicaid program works. And there's kind of just different philosophy behind it. But I can't speak to the number of current enrollees that have jobs because it's not something we track. But using income as a proxy, it's definitely a significant number. So that concept that people on Medicaid don't have jobs is not accurate.

[Thomas Stevens (Member)]: But, well, in my reading, it's well used. I mean, that's really one of the things that is not for you politically, but just the idea of flogging people who receive Medicaid as people who don't work. Just think that's

[Ashley Berliner (Director of Medicaid Policy, AHS)]: getting Well, buy

[Thomas Stevens (Member)]: it gets in my way of wanting to understand even further what the changes are. I mean, twenty hours a week, I can say as a fairly able-bodied person that I can work twenty hours a week if I have to receive Medicaid, but that doesn't take into account the stresses of poverty, it doesn't take into account if I'm already working a sub living wage job. I just

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: Yeah, I appreciate your John? I

[John Kascenska (Member)]: actually had a similar same question.

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: Okay.

[Michael Nigro (Member)]: Mine's a little bit flipped on that. So of the 30,000 people, quite a lot of working already. The requirements probably won't impact you administratively because you'll have to collect data.

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: Yeah. And then that will in turn impact them because we'll do our best to work on implementing this in a way that helps people get through the process. We'll use data sources. We'll try to minimize the paperwork requirement, but we can't eliminate it. And so to the extent that people have to show us pay stubs or whatever else for the first time, that's a big lift. Because you

[Speaker 0]: haven't been tracking who works. I mean, you can make some assumptions based on what you see at income, as you said. You can make some inferences, but you don't know. But everybody's going to have a more challenging time because now they have to

[Michael Nigro (Member)]: show you that they're doing that. Yes,

[Martha Feltus (Vice Chair)]: Marty. When you indicated you thought this would affect 30,000 people as opposed to the 50,000 we talked about before, I presumed you meant that you were deducted 20,000 because they were pregnant or medically frail or those with children. That's correct. Yeah, there's also, again, kind

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: of a proxy for income that factors into that as well. So we do know if you make I think it's the equivalent of minimum wage for that number of hours per month, we can count that as opposed to getting further documentation. So that's just another way of reducing the number. That you think might be affecting the next Correct. So those are the three what we are very much focused on for the I just want to briefly comment on the fact that there's another really significant change in the pipeline under this bill that we will work on in 2027 once we finish the Medicaid changes. And that's completely reconfiguring the way that we do the open enrollment process and the renewal process for qualified health plans in the marketplace. Right now, we have a very automated, automatic renewal process. Under this new provision, people will have to show documentation that they meet all the eligibility requirements in order to get premium assistance to enroll in that qualified health plan on an annual basis. This is another one, the cost sharing provision that Ashley described, waiting for guidance, because the hope would be that as they promulgate regulations, they'll realize that this needs to be not quite as stringent as the legislative language suggests, because, again, it would be a very uphill battle to maintain your coverage and your premium assistance. So when it says effective oneonetwenty eight, it

[Speaker 0]: really opened at the '7,

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: right? That's right.

[Speaker 0]: So again, more work on your end. It will be acquired with staff. It's a big, big project. Yeah, it seems like a very big project.

[Eileen “Lynne” Dickinson (Member)]: Yeah, I'm a little confused here. My understanding was that they had to verify their income yearly anyway until COVID, and then that opened up. This open enrollment. Or is that am I confusing that with Medicaid?

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: Yeah, that was the change for Medicaid. There wasn't a change in the Marketplace. Unlike Medicaid, Marketplace has an annual open enrollment period. So it's a limited period of time when you can enroll or change. And that's a very automated process. So all you have to do is say, hey, my information is the same. And then we put you right back in the same plan, and you can continue your coverage. This is saying that before we put you back in your same plan, you have to prove that you still meet all those standards. And what that looks like is, like I said, we will learn more as they propagate regulations.

[Eileen “Lynne” Dickinson (Member)]: Because my understanding is that the subsidies were predicated on income. Correct. So no one was verifying the income anyway.

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: We were always verifying income, but that happens through a process with the IRS, through data sources. Within the government? Yes, within federal data services.

[Eileen “Lynne” Dickinson (Member)]: So then during COVID, did they not share the information? No, we did that during COVID. So we did all the arguments. It's been a system over years. Okay. All right.

[Michael Nigro (Member)]: Thank you.

[Thomas Stevens (Member)]: So essentially this would be 30,000 new interviews if you have to or emails or that people who receive Medicaid have to go to a website or have access to a website. So first of all, we know that's difficult. That's the reason why we created the system that we have. Who's paying for this?

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: So is your question about the previous provision on Medicaid

[Thomas Stevens (Member)]: or So we already know that as of January 1 that there are a certain number of people who lost their subsidies. So that's a piece of chaos that we haven't heard enough about recently, and I'm sure we will through the budgeting process. But when you say that must return to the marketplace annually to verify information, that strikes me as that number of, the amount of human resources you are going to need because if you're in control of verifying this, you are going to need how many people and you already talked about that earlier for the Medicaid piece. But who's paying for that? Is the government sending you a check for increased, they're requiring you to do increased administration, but without having a number, who's paying for it? The

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: The state is paying for it. It's a little bit of a complicated question because our marketplace is integrated with Medicaid, so we're able to leverage administrative match operations. But yeah, it's a shift to the state. We are being asked to do more by the feds, and we will pay for it.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: And then we'll sign it

[Thomas Stevens (Member)]: a little bit, maybe inappropriately, but we just have the provider fees which go into the general fund which implies that they can be used for other purposes are not available for this either. So we're taking a hit on provider fees plus we're taking a hit on this here.

[Michael Nigro (Member)]: Great, thank you.

[Martha Feltus (Vice Chair)]: Oh, there are places where we're taking hits, aren't we? So I have Marty, Dave, and Wayne. I understand in this particular qualified health plan program, you have an automatic renewal process that's fairly even. And people just say, my information is the same and therefore you filed. And you mentioned you have a cross check with federal data sources in order to check income, I presume at that point. Do you know how many people then are disqualified based upon that new check you did every December on somebody's income? I presume there are some people that move, they graduate out of being eligible for qualified health plans. And I presume there are some that are no longer eligible to enroll in this. Do you have any idea how many that occurs? Well, under the current state, most people let us know if

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: they have a change. So the information is coming directly from them because they know they've got a new job or whatever the situation is. If there's an inconsistency between what customer has told us and what the data source shows, we go through an outreach process where we say, hey, we have this inconsistency. Let us know what's right. A few thousand people a year are subject to that, so out of the almost 30,000 who are in the marketplace.

[Martha Feltus (Vice Chair)]: That's small percentage. But nevertheless, it does pick up

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: when there's Yeah, there robust is process around that. There's also a robust process around reconciling a premium assistance, which is an advanced payment of a tax credit through the tax filing process. So there are many checks and balances even in the current state.

[Speaker 0]: Dave, and then, IRSAP update. I don't want

[David Yacovone (Member)]: to be disrespectful, but I just can't help, they're seeing the presentation thus far, I just can't imagine somebody standing on the steps in Washington in front of a camera and saying we're not cutting Medicaid. That they either disingenuous or can't count, or both. You know, just the impact of this and then there's more administrative expenses on SNAP, which we'll hear later, so just

[Michael Nigro (Member)]: very troubling.

[Speaker 0]: It's upending the way we have done this for a

[Martha Feltus (Vice Chair)]: long time. Yes, thank you, David.

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: Any other?

[Michael Nigro (Member)]: Bigger cup.

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: We really just have one more slide. And just to say what I hope is implicit. But this is a tremendous project. A big team working on it, a lot of collaboration across the state. We've had to drop everything and refocus on this for the course of this year and probably the next one And as our goal beyond, obviously, complying with the changes and implementing our changes is to mitigate any coverage loss among eligible remonters. That's a huge area of focus. And again, as I referenced earlier, I think we learned a lot as we had to restart the redetermination process after the public health emergency and learn to make better connections and better communications to help people keep their coverage. There's a couple of challenges in that space. For example, with these changes to Medicaid, particularly the work requirements, if someone doesn't meet those, they can't then go to the marketplace. They're also disqualified from premiums in So the there's some barriers there. But we will, again, work as hard as we can to help people with this process through the system and through the community and do our best. So I just wanted to show that.

[Eileen “Lynne” Dickinson (Member)]: Can you further explain that last piece about the transition to the qualified health plan marketplace is not an option for those who do not meet Medicaid work requirements? My understanding is that if you want to get on Health Connect or get into the qualified health plans, there has to be a change in your status, a new baby, a change of job, a change of income,

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: I don't know, whatever. Why wouldn't Medicaid eligible people who don't have the work requirement not be able to use qualified health plan? I can't really answer that from a policy perspective, because it's just a decision that was made as part of this bill to have the exclusion carry across programs. Separately, to your point about enrollment opportunities, that's correct. You have either open enrollment or you have to have some kind of qualifying event. Slight change in turn. Yeah. And with the transition from Medicaid, what I was trying to get at is that someone who actually whose income grew over the 138% of the meds, maybe they got a job, an additional job, whatever else, they would be able to then transfer over into the marketplace and get But premium now, if the reason they're losing Medicaid is because they weren't able to give us the paperwork to show they met the community engagement requirements, the work requirements, then we also can't then screen them for the premium assistance. They're stuck. Even though they have lost their Medicaid

[Eileen “Lynne” Dickinson (Member)]: insurance, but they have eligibility to use Medicaid. That's not the same

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: as they go from Aetna to Blue Cross or something. Under current law, is this is a big change. And it's, again, if they lose Medicaid because they're not meeting the work requirements or didn't cooperate with the process to choose, then they're blocked from the marketplace.

[Eileen “Lynne” Dickinson (Member)]: Because I happen to agree with Representative Stevens. There's a lot of people who are receiving Medicaid because of all the different income eligibilities that actually have Medicaid and they do have jobs. They might have a job before they have Medicaid. So I'm not sure. I mean, I can understand they're trying to get people to do something with their lives. Maybe, I don't know. But I just don't understand that disqualification.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: It's a life changing incident. It's hard to understand the thinking that's happening elsewhere. Yeah,

[Martha Feltus (Vice Chair)]: TIFF? There was a very recent seven days article about DCF's data, a crash that was very serious. I'm just wondering how well equipped are your systems?

[Eileen “Lynne” Dickinson (Member)]: How well

[Martha Feltus (Vice Chair)]: is your technology how well equipped is your technology to do what you're talking about?

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: It's a great question. The IT aspect of this is really significant. We're able to work with our existing vendor who runs our eligibility system, and we're just modifying the contract with that vendor to do this work. This is something we can also talk about in the context of a budget. There's a cost associated with it. There are some federal funds available. And there are a lot security standards that we have to meet already, and nothing about that will change. But yeah, there's definitely a reliance on IT systems. I think we'll be Okay in getting these changes made, but I can't predict everything. Right. And so is every other state going to have to be. Right.

[Speaker 0]: You have one last page.

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: Yeah, I just wanted to include the timeline. I don't think I need to spend much on It's just messaging.

[Speaker 0]: It's just a visual for all the things that we talked about. Yeah. You're working now. Yes. Great.

[Martha Feltus (Vice Chair)]: Thank you.

[Speaker 0]: We appreciate that. Thank you. And appreciate that you're going to try to keep everybody on that's eligible.

[Addison “Addy” Strumolo (Deputy Commissioner, Department of Vermont Health Access, AHS)]: This is just, we're starting to get a taste of what's happening thank you for having us

[Speaker 0]: yeah so thank you very much hey committee we can take five minutes, and then Brynn here is coming in with Karen Dolan with something that's going into the budget adjustment, which they will explain to you. It's language related to changes in the way legislative offices organize. So it's some statutory work that needs to be done.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: There's not money involved, but They're not

[Speaker 0]: turning us into senators. They're already turning into the chat No.

[Ashley Berliner (Director of Medicaid Policy, AHS)]: Did you want that?

[Speaker 0]: Do we have a bill?