Vermont Legislature SmartTranscripts:

[Alyssa Black (Chair)]: Good morning, everyone. It's Friday, January 30, and we're starting off this morning with DMH from their budget presentation. Welcome.

[Emily Houghton, Commissioner of the Department of Mental Health]: Thank you. Good morning. For the record, Emily Houghton, Commissioner for the Department of Mental Health. And with me today, I have Samantha Sweet, Deputy

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: Commissioner at the Department of Mental Health.

[Emily Houghton, Commissioner of the Department of Mental Health]: So thank you for having us today. DMH will be going over our FY27 budget. I'd like to first start with how the agency of human services approached the budget work this year, which was from an agency of one lens. So over the course of the summer, the group of commissioners and the executive leadership team for the agency of human services met weekly to go line by line of the different departments programs. As we knew we were facing a fairly challenging year from a budgetary perspective. From a DMH lens, we operated with this work under the core values for the department, which is compassion, equity, integrity, collaboration, and accountability. Grounding ourselves in those core values and beliefs were a pivotal foundation for this work as we went line by line. As we go through our testimony today, Deputy Sweet and I will highlight some budget pressures. We'll also be proposing some reductions to the budget. For general awareness, VMH provides oversight and designation for 10 designated agencies, two specialized service agencies, six designated hospitals. We operate the Vermont Psychiatric Care Hospital in Berlin, as well as the River Valley Therapeutic Community Residence in Essex. As a department, we have around three twenty six positions, which two forty five of those are within those two facilities that we operate, which are 20 fourseven facilities. That also includes a business office at central office, administrative support, our quality department, research and stats, care management operations, all of those functions that are necessary for our department to operate. We also collaborate with all the Vermont hospitals. We have contracts for forensic psychiatry, And we, in addition to working closely with our community partners, such as Vermont Care Partners, the National Alliance of Mental Illness, Pathways Vermont, and many others. This is a snapshot of our current organizational chart. This information can also be found in documents submitted. So I might skip through some of this because you've either seen it or it's easily available. But if there's questions or if I'm moving too fast, I'm happy to slow it down. From a vacancy perspective, since vacancies at our two facilities greatly impact our overall budget, I wanted to provide a quick snapshot into the vacancies currently existing within the Department of Mental Health. So as you'll see here, the red line being a positive trend, which is a lower vacancy rate than we have faced in the past five years. In 2021, we had around a 60% vacancy rate at that facility, and we are now down to around 37%.

[Leslie Goldman (Member)]: I'm just comparing, as you say, one year ago to today, and it goes from almost 33% to 31%. How many positions does that represent?

[Emily Houghton, Commissioner of the Department of Mental Health]: Are you talking the overall?

[Leslie Goldman (Member)]: Uh-huh, the red line. Sure. I'm looking at your text, one year ago and then today.

[Emily Houghton, Commissioner of the Department of Mental Health]: Yep, and depending on which line item you're looking at, so the red is the hospital.

[Leslie Goldman (Member)]: I'm just looking at your blue where it says blue one year ago and then today.

[Emily Houghton, Commissioner of the Department of Mental Health]: Oh, okay. That's overall. So that encompasses all of the positions within Central Office River Valley and VPCH. So if you want specific, we can get that to you.

[Alyssa Black (Chair)]: No, I'm just curious

[Leslie Goldman (Member)]: to know because you said it was 33% down to 31% and how many positions that represent the

[Alyssa Black (Chair)]: absolute number rather than the Yeah, gotcha. Brian, is there a question?

[Brian Cina (Member)]: What is RVTR? River Valley, okay. So it looks like there's a decline in people working in direct care and an increase in people working in administration. Is that true or not?

[Emily Houghton, Commissioner of the Department of Mental Health]: That is not true. So we have more vacancies now. It's central office, which is our primary administrative. Central office is around 18% and that has gone up. That's the blue line. We have more vacancies in these.

[Brian Cina (Member)]: Oh, okay. I see. So this is actually like the rate of opening going down. So you're filling positions doing direct service more and there's more openings in central office. Correct. So I probably should look ahead before I ask this, but I wonder if those are opportunities for savings that you might identify.

[Emily Houghton, Commissioner of the Department of Mental Health]: Yes, we have identified opportunity for savings across the entire department And we're happy to go through that a little bit more as we go through our reduction proposals. Hopefully not your finance manager. Daisy, you have a question. I did look ahead. Because this is your budget testimony, I'm concerned because you don't get to budget until slide 26.

[Daisy Berbeco (Ranking Member)]: And there's a lot of overview coming up to that. So I just want to make sure that we're talking about the significant amount of cuts that DMH has. I mean, half of your budget sheet is red.

[Alyssa Black (Chair)]: Yes. So I hope that you're going

[Emily Houghton, Commissioner of the Department of Mental Health]: to weave in the reason for those cuts as you get to slide 26. Absolutely. When I started off, I did if the committee wants to go faster, happy to skip through some of this. Although I do think it's important to highlight the successes and work we've done around September and enhanced global crisis in our mental health urgent cares. Happy to tailor to that and then get into the budget ups and downs in summary if that's how folks would like to go through that because we're aware that there's lots of questions and there should be around those reduction proposals. And so we want to be able to honor that opportunity for folks. So with that said, I'll go ahead and move over to our crisis system of care and highlight the work that we're doing within the nine eighty eight segment. And so that would be slide 14, please.

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: So many of you have heard me talk about our crisis system of care before, but as a reminder, the way we look at this is the person on the left is the least restrictive all the way up to crisis beds. And so this is our community crisis system of care. So we don't include hospitalization, things like that. So when the person is in crisis, they can access 988, enhanced mobile crisis, or go directly to a mental health urgent care. And we currently have six mental health urgent cares throughout the state regionally. And we collect a bunch of data around the mental health urgent cares to understand who are they serving, what are the numbers, and looking at it regionally. Our enhanced mobile crisis also resolves most crisis in the community up to eighty one percent. And then what we see on nine eighty eight calls, chat, and text is that 95% of calls have been resolved over the phone.

[Emily Houghton, Commissioner of the Department of Mental Health]: I'd also like to just mention recent work done within the crisis fed system to integrate the crisis fed capacity for those facilities to be able to serve individuals in both substance use and mental health crisis. I'd also like to highlight that with 988 and with mobile crisis, those are also co occurring serving individuals who are experiencing a mental health and or substance use crisis.

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: So next slide, I think a minute on our screen. 988, like I said, it offers call, chat and text. And we have trained counselors answering those phone lines 20 fourseven. We currently have two agencies in Vermont answering all the calls, and that's Northwestern Counseling and Sports Services and NKHS, which is Northeast Kingdom Human Services. Our vision has always been about enhancing our crisis system of care. So how is 988 interfacing with enhanced mobile crisis? How is that interfacing with enhanced mobile crisis or mental health urgent cares? And so we're really looking at what are our goals for that system and moving that system toward those goals. Next slide. So as you will see, there are about seventeen fifty calls on average during a month. In November, we saw a little bit less calls and about 82 are answered in the state. And so what that means is that a call, a Vermonter calls or a text or a chat with 988, 82% of those are called by someone within the two facilities, two agencies. If they're not able to answer the phone call, it does go to a national backup line. So someone is always answering. Our goal is to get to 90% answer rate within Vermont. So Vermonters are answering Vermont calls.

[Emily Houghton, Commissioner of the Department of Mental Health]: I'd also just highlight from a utilization perspective, Vermont is one of the highest, if not the highest, utilizer. 988 for Capita. Also taking an opportunity to highlight the transfer protocol. Okay. Do you want to go?

[Lori Houghton (Member)]: No, go ahead. Okay.

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: So over the past year, we've been working on two big initiatives. One is with nine eleven. We are the first in The United States to have a call go into 911, and that call be able to be transferred to 988. So a warm handoff to 988. This allows us to be able to respond with enhanced mobile crisis instead of law enforcement. So we're really excited about that. It just started within the last couple of months.

[Alyssa Black (Chair)]: Does the 911 operator make the determination?

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: Yes, there's a strict protocol because this took a lot of work to have guidelines around 09:11 because they're very clear of like, if someone calls, they're experiencing chest pains, they can flip to what to exactly do. Mental health is different, right? You can have a caller calling about anything. And so we have some key words that get picked up by 911. They understand if there's any question, they can move ahead with keeping it in the 911 track. But if it's clear, mental health, they'll divert it to 988. Let's see. So I talked about the 90% answer rate, which we that is our goal. The other thing I will highlight with 988 and Enhanced Mobile Crisis, which I'll get into a little bit more, you'll see in 2025, we started a new software called BHL, which is Behavioral Health Link, and it allows dispatch from 988. So a call comes in to 988, it cannot get resolved over the phone. They can dispatch through this platform enhanced mobile crisis. State what? State one. Brian?

[Brian Cina (Member)]: Is VHL the app that crisis workers are being asked to install on our phones? Yes. So so we don't need to get into it now, an ongoing issue is that no one is telling us how our data is shared once we put it on our phones, and we're also being told that we have to put it on our phone, But what if we don't have a phone that we're bringing to work? Is the state going to provide us with phones then? It's honestly an issue for me because I don't want the state having access to the data on my phone just because of my job. Personal phone, is that right? Yeah, yeah, yeah. So this an emerging issue, there's been also some confusion around how are the resources of local crisis teams going to be managed if there's this external force poking its way in? I know that people are working this stuff out, but I'm just curious if the state could look into more, be more transparent maybe about how BHL uses data, maybe even including it on the state AI inventory if it's going to be collecting data by the I don't know if it is by those standards. I don't know you have more to share about how it works.

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: Yeah, and we could definitely have our crisis director come in and talk. He is intimately aware of all the workings of nine eighty eight mobile crisis and the urgent cares. And so he would be able to have a one off conversation with you too and come to this committee and talk further. So mental health urgent cares. I said earlier, we have six throughout the state right now. We are gathering data to see the utilization of all the data. We are looking at an approach to do regionally so that we have each pocket of the state will have mental health urgent cares. We went this approach as we know that the emergency rooms are not

[Emily Houghton, Commissioner of the Department of Mental Health]: therapeutic place

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: for those experiencing a mental health crisis. And so we have found that the utilization is very high. It lowers the stigma. It's very person centered. We have clinicians and peers embedded at the mental health urgent cares. And what we're finding is that the utilization for the peer support is actually much higher than those seeking clinical counselors. Six active programs, how many of them are

[Alyssa Black (Chair)]: youth centered?

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: Focused. We have two out of the six. And then we have one that is serving the whole age span. So two are specifically focused just on youth and one is the whole age span. Our goal is Rutland

[Alyssa Black (Chair)]: and What's the other one?

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: No, not Rutland. It's UCS, So Bennington area and then HCRS area. So Windham and Healthcare and Rehabilitation Services. Windham Windsor. So

[Brian Cina (Member)]: in Southern Vermont, there's two pediatric or youth focused urgent cares. Then in the North in Burlington, there's the adult one. Okay, just two.

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: And then Northeast Kingdom is serving the age span. Our goal is to get every mental health urgent care to be able to serve the whole age span and to increase the hours.

[Emily Houghton, Commissioner of the Department of Mental Health]: That goal would be 20 fourseven. As we know, as long as there's an opportunity for someone to go to the emergency room, that we are as humans, that's where we're going to go because we don't have to think about when an emergency room is open, it's always open. And so getting to that 20 fourseven is really valuable from

[Alyssa Black (Chair)]: Now, are not billable services, correct?

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: We are working toward that.

[Alyssa Black (Chair)]: Yes. So with this Rural Health Transformation grant, what is the hope? Because I know this is a part of it, is building out a system of mental health urgent cares across What the

[Emily Houghton, Commissioner of the Department of Mental Health]: is the hope in how we're going to go from six to what number? We'll still continue to look at a regional perspective from a mental health urgent care. The last couple of years, we've had an opportunity to gather data about how many people they're serving and also what communities are responding the most to. And so is mental health urgent cares as a part of that RHT. There are some parameters about what we can utilize those dollars for. We also have our certified community integrated health center or CCBHCs, which there is likely an opportunity to combine those mental health urgent care rates into that CCBH rate.

[Alyssa Black (Chair)]: Brian, did you have a question?

[Brian Cina (Member)]: Can I talk first?

[Alyssa Black (Chair)]: No, had that one, Leslie.

[Brian Cina (Member)]: It's a quick one, I think. If people go to an emergency room and they go to the triage desk or the intake desk or whatever it's called in whatever facility, and are they being screened and deferred to urgent care if the triage nurse, whoever determines that that might be a better, or do they get taken into the emergency room, go through the whole emergency room process and then get sent there if it makes more sense? Because I'm wondering if that's an area for savings, if there was some way to deflect people or refer them. It's not meant to be deflect like it's a bad thing, it's

[Sebastian Lueders, Department of Financial Regulation]: a good thing. Maybe you

[Brian Cina (Member)]: want to get more appropriate use of resources. Is there any kind of efforts to look at how to do that or is that happening at all?

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: Yeah, a lot of work has been done by our crisis team to go into and meet with every hospital so that they know about 988 and our mobile crisis. So I would love to say, yes, we can divert that, but when people walk in the door, they may be seen there. So even though we've put a lot of effort into showing other ways that they can seek mental health treatment.

[Karen Lueders (Member)]: I may

[Leslie Goldman (Member)]: be getting ahead of myself, so accept my apology. I'm just trying to understand. I understand these are the programs, but I'm trying to understand the connection between these programs and your budget. Is there a connection and where can I find a cross reference? And you may be getting to that, but as Daisy said, it's later on in your presentation. So I'm trying to understand the cuts

[Emily Houghton, Commissioner of the Department of Mental Health]: because there's a lot of red

[Leslie Goldman (Member)]: and how that red is going to affect all these programs you're talking about and that interaction. Sure.

[Emily Houghton, Commissioner of the Department of Mental Health]: So why don't we just skip over to the FY 'twenty seven budget For folks who we sent our slide deck ahead of time, please feel free and look through that and ask us any questions you might have, especially if that's related to the psychiatric residential treatment facility, which is coming online at the Brattleboro retreat in 2026, and an inpatient adolescent unit at Southwestern Vermont Medical Center. And those capital contracts and operational contracts to the sum of around $10,000,000 are in the finalization of being sent out to SCMC for signature. So you'll see on slide 26, this is a summary of the budget for the Department of Mental Health proposed for 2027. And this breaks out. I think I saw a question from yesterday's testimony about two things, how much money is in grants, how much is in Medicaid. And so this first slide is pie graph of those. So you'll see the big green is Medicaid global commitment funds. We have a slice of federal funds and the dark blue interdepartmental transfers are the dollar amounts that go between the agency of digital services, human resources, general fund, and then Medicaid investment dollars, which is missing its title.

[Sebastian Lueders, Department of Financial Regulation]: Breaking

[Emily Houghton, Commissioner of the Department of Mental Health]: that down farther is the breakout across the system of care. And so from a budget perspective, around 71% of our funding at DMH goes to community based programs.

[Lori Houghton (Member)]: Yes. I'm sorry, the next one.

[Emily Houghton, Commissioner of the Department of Mental Health]: Oh, the one before. Oh, no, that one. Okay. Oh, she's running the slides

[Lori Houghton (Member)]: now. Oh,

[Emily Houghton, Commissioner of the Department of Mental Health]: We got

[Alyssa Black (Chair)]: you from the beginning.

[Emily Houghton, Commissioner of the Department of Mental Health]: It's magic. Yes.

[Alyssa Black (Chair)]: Sure.

[Karen Lueders (Member)]: Daisy. We see two PNMI blocks on the left. Can you

[Emily Houghton, Commissioner of the Department of Mental Health]: remind me? Yes, there are two different types of PNMI. We have the PNMI full residential. We also have some crisis beds that are part of PNMI and out of state private non medical institution.

[Karen Lueders (Member)]: Which of those represents which?

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: Yes, the bigger the green is the PNMI crisis beds, the out of state placements for PNMI residentials. So the bigger slab is or bigger place is that rate for the programs.

[Alyssa Black (Chair)]: Is there a reason that you've included residential and out of state all in the same chunk of pie?

[Emily Houghton, Commissioner of the Department of Mental Health]: It's like a salary broken out in the ups and downs, and so this is a reflection of that. But we can talk a little bit more with finance folks about the differences between separating those out.

[Alyssa Black (Chair)]: I'm really curious about the out of state component.

[Emily Houghton, Commissioner of the Department of Mental Health]: Oh yeah, Do you have specific? We have quite a bit of data related to the out of state placements.

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: Yeah, there's a slide in the deck early on that shows you exactly how many go out of state for fiscal year, if I remember correctly, without it being in front of me, fiscal year five. And then the slide on the table on the left is a point in time. So I think that's January 22. You'll see that's a very specific just day today, how many people are out of state, how many people are seeking for all three departments, DCF, DMH, and Dale. So that's early on in the slide deck, if you want

[Lori Houghton (Member)]: to go back. Slide 22.

[Alyssa Black (Chair)]: Thinking I was looking at it, just looking for a breakdown of how much of that $73,000,000 is going out of state.

[Francis “Topper” McFaun (Vice Chair)]: Oh, good questions.

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: We don't have that in front of us, but we can definitely get that.

[Emily Houghton, Commissioner of the Department of Mental Health]: That's right. You said

[Alyssa Black (Chair)]: no numbers questions.

[Emily Houghton, Commissioner of the Department of Mental Health]: Which is hard because I realize we're giving budget testimony. So we want to be transparent about that. So for the appropriations committees, we're not going through the ups and downs. We're going through a summary. Was the summary okay for this group or would you like for us to go down to a specific subsidy? I think the summary is what our pressures are. We have a couple of initiatives and then primarily our reduction proposals.

[Alyssa Black (Chair)]: I think we sort of like to know what's going up, what it is, and what's going down.

[Brian Cina (Member)]: I'd especially like to know more about forensic work since there's buzz about that currently.

[Emily Houghton, Commissioner of the Department of Mental Health]: You might not see much in our budget related to forensic work. That's outside of the DMH budget, but

[Francis “Topper” McFaun (Vice Chair)]: Who's budgeted?

[Emily Houghton, Commissioner of the Department of Mental Health]: Well, right now there's not a budget with that, I don't think. But So there are components of folks who are labeled, identified as forensic across the entire system now. I can talk a little bit about how that impacts our budget. Right now, I'll highlight that our current budget ups, all under traditional salary and fringe are benefit rate changes. We have increases related to a federal requirement for the pre admission screening and resident review nurse, which is also known as a passer. That is a required federal screening for someone's rehab in order to be assessed for appropriateness for a nursing home care. We also have a net neutral shift for the forensic assertive community treatment. It looks like an up, but it's net neutral. That is MOU that we have with the Department of Corrections to engage with folks at the community level. Also, the PNMI budget pressures, which we talked about in our BAA testimony that's related to utilization and rates increasing.

[Karen Lueders (Member)]: Is the Is that T2? No,

[Emily Houghton, Commissioner of the Department of Mental Health]: it does not.

[Brian Cina (Member)]: That's why I brought up forensic, it's because I saw that.

[Emily Houghton, Commissioner of the Department of Mental Health]: Yeah. The FACT is an evidence based model, forensic assertive community treatment, and essentially a wraparound case management engagement service for individuals who are engaged with the criminal justice system and have other types of case management needs. And Pathways is the organization that delivers that service.

[Brian Cina (Member)]: These are people who are justice involved who also are struggling with co occurring disorders? Okay. So it's providing extra treatment as part of the criminal justice process. In

[Emily Houghton, Commissioner of the Department of Mental Health]: an outpatient setting, community setting.

[Brian Cina (Member)]: So it's community based services. That's correct. Thank you.

[Emily Houghton, Commissioner of the Department of Mental Health]: Outside of a hospital, DMH doesn't contract for any services within the prison system. These three budget initiatives are additions to the DMH budget. So continuing our work, expanding the behavioral health link, which is the program that we talked about earlier, and we'll follow-up around data concerns or clarification, but the centralized dispatch for enhanced global crisis from that 988 call. We also are requesting for the authority to spend additional dollars as it relates to the universal service fund, DMH and 988 is a part of a waterfall of priorities related to the Universal Service Fund. I think we're like fifth on the list there. And we want to make sure that we have the authority to spend that money on September. And then related to our CCBHC initiative, we have two current agencies who have moved to the CCBHC daily rate, and we're in the process of certifying five more. And we anticipate those being online in July '26. Currently, the state of Vermont is in a demonstration status with the federal government, which means that those agencies receive a enhanced federal rate for the services that they provide under the CCBHC model. And there's a lot of information about the CCDHC model in the packet. And I would ask that folks get familiar with that. That's really the foundation of how we're looking at streamlining and improving the quality and access for care for mental health and substance use services.

[Lori Houghton (Member)]: Can I go? Oh, yes. So for these specifically, are they in the ups and downs somewhere so we

[Emily Houghton, Commissioner of the Department of Mental Health]: can see them not related to each? Yes, are. Thank you.

[Lori Houghton (Member)]: Yes, they are. Okay. Thank you.

[Emily Houghton, Commissioner of the Department of Mental Health]: It'll be in the non facility. So there's two, there's a B314 and a B315. I think 314 is Central Office. This is

[Lori Houghton (Member)]: in Central Office. Yeah. Okay, thank you. You're welcome.

[Emily Houghton, Commissioner of the Department of Mental Health]: So the next slide is several proposed reductions. And I'd like to again re acclimate ourselves to the work that the executive leadership team did over the summer, looking across the entire book of business toward the agency of human services and being guided by those core beliefs and values of the Department of Mental Health. Understandably, folks are going to be impacted. From our perspective, we do have a system in place that can appropriately serve folks in our communities. So first up is mental health training for first responders. Representative Berbeco, this is the Team two training. Team two was developed and implemented a little over a decade ago when DMH did not have a crisis team within the Department of Mental Health overseeing the implementation of mobile crisis at September. Over the past couple of years, BMH has been able to grow that team and we'll be shifting the training for first responders in house and taking that over within the department instead of contracting that out. And we do feel that we can absorb that within that current team.

[Brian Cina (Member)]: So trying to break it in pieces, without spending additional funding, you believe that you believe, but you're reporting that. The existing staff can provide training for basically it's law enforcement and mental health workers together. Absolutely. Is it possible that you could expand the training without spending more money and provide more training than Team two does?

[Emily Houghton, Commissioner of the Department of Mental Health]: That's a really good question. I don't think we're there yet. We would prefer to do is to take that training in house, make sure that it is seamless from an integration perspective of nine eighty eight, enhanced mobile crisis, CCBHCs with a strong emphasis on persons with lived experience. And once that happens, I don't think we're ever at a full array of training. There's always more training we can do regardless. But we would analyze that as that transition happens and shift training as needed.

[Brian Cina (Member)]: Would it be possible to So currently the DMH, I don't know if DMH is the one I can't remember if DMH is actually the one who is implementing the training using remote means for crisis teams with the CCBHC, but you know what talking about?

[Emily Houghton, Commissioner of the Department of Mental Health]: That.

[Brian Cina (Member)]: You're paying for it. You're overseeing it and it's high quality from my opinion.

[Emily Houghton, Commissioner of the Department of Mental Health]: From an enhanced mobile crisis response, yes.

[Brian Cina (Member)]: Is it possible that law enforcement could just do that same training, that same remote training, because then they would at least have the same language as the crisis workers, even if you weren't cutting team two. I mean, that's just the way, like if you already create the program, is there really much additional expense with just having every law enforcement officer in the state be asked to do that as part of their duties, there's additional, whatever it was, fifteen hours of training over the course of a year.

[Emily Houghton, Commissioner of the Department of Mental Health]: My first response is this is a budget reduction. And so we'll need to streamline how we train law enforcement. What I do think is a benefit to this is that when you are able to do that in house, there are opportunities for better integration across all the platforms that we are serving our communities with. Know that it's a shared language across folks interacting with each other and community members is incredibly valuable. And that's what we would aim to do.

[Brian Cina (Member)]: For what it's worth, this will be like my last interaction because I don't want take too much space.

[Alyssa Black (Chair)]: And I'm just cognizant of time here and I really want to get through these things. I

[Brian Cina (Member)]: think the greatest loss is going to be having law enforcement officers and mental health workers be together in a space and build relationships. So I think that's going be the biggest thing that is lost from this being caught. And so if there's any way that can be preserved or expanded.

[Emily Houghton, Commissioner of the Department of Mental Health]: That would not be our intention to not do that. We see that as a very valuable interaction for folks. And so training law enforcement and supporting the work of folks who are working within the crisis system or first responders, that is still our commitment. This is a reduction for that particular contract for team two and taking that in house.

[Brian Cina (Member)]: And I guess the other thing is that if you're going be reconsidering how you train the workers, just if maybe a reminder that the Health Equity Advisory Commission talked about a whole of government approach to training, and this might be an opportunity to look at how this investing money in training, can we invest money in training in a way that helps more workers not less? Absolutely. The

[Emily Houghton, Commissioner of the Department of Mental Health]: next line item is our bed board. So folks who were around with Tropical Storm Irene, the state of Vermont implemented a digital bed board, which gives a point in time notice of available beds across the system. We have shifted that bed board contract in house, And so that is a proposed reduction of, I think it's around $15,000 We'll no longer contract that out. That is going to be moved within the state of Vermont.

[Karen Lueders (Member)]: Where in your place it is that?

[Emily Houghton, Commissioner of the Department of Mental Health]: It's on the budget ups and downs sheet. Sure. It's listed in the red. So small, isn't it? Yeah. I can point it

[Alyssa Black (Chair)]: to you in this.

[Emily Houghton, Commissioner of the Department of Mental Health]: I'm just trying to parlay here in the money and the program,

[Karen Lueders (Member)]: but maybe that's not the right one.

[Emily Houghton, Commissioner of the Department of Mental Health]: So all of these things that are listed up here is that chunk of red at the bottom of the one slide.

[Lori Houghton (Member)]: You need to go to this.

[Emily Houghton, Commissioner of the Department of Mental Health]: So the next line item is project management related to suicide initiatives, otherwise known as the Governor's Town. We currently contract out project management for that work. And since, I would say, I think it was legislative session 2021 or '22, we now have a director of suicide prevention. And so we would continue that work in house. We would no longer contract that. The next line item is nursing services at a community care home. There's one community care home in the state that the Department of Mental Health funds nursing services that, and that is at Kirby House in Washington County, Waterbury. So our proposal is to reduce that nursing services and explore transitioning that into a CCBHC rate or explore other avenues for nursing services for individuals who are living there. The next line item is DMH outpatient services related to the TBI waiver. You skipped one. Oh, I did. That was a purpose. I promise. And you have she's got a reason. That wasn't on purpose. So last year, this was also a reduction proposal from DMH. And so we are re proposing it again this year. This is a $160,000 line item for community outreach for Chittenden County. This is community outreach services to the broader Chittenden County area, as Hinesburg, Richmond, Winooski, Essex. I was getting there. Saw it. And in fact, several folks in this committee's community. From a data perspective, a majority of these interactions with folks are phone calls. And we would like to direct that interaction to 988 and better utilize our 988 to mobile crisis to urgent care system that we've implemented. Anything else you want to add?

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: Yeah, I'll just add that this provides services or is contracted with nine cities or towns, and two out of the nine receive less single digits each month of contact. What we also see is in a quarter, 35% is face to face. So you have 65% either on the phone or doing collaborative work with agencies. So we also feel like this is a duplication of services, and we really want to utilize enhanced mobile crisis for this. What we also know is it employs five to six staff over nine towns, so that's less than forty hours a week that each town is receiving. And so where mobile crisis is 20 fourseven, can be dispatched at any time, move those staff into Enhanced Mobile Crisis Team.

[Lori Houghton (Member)]: I was just going to say, I have a ton of questions, and I really want to see the data on this because I hear the exact opposite from my community. I have called them myself as a business owner. And I'm not sure Enhanced Mobile Crisis would respond to the calls that our community has for this case. So I would just love to see your data. Okay.

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: Thank you. Yes, we can share that.

[Emily Houghton, Commissioner of the Department of Mental Health]: Can I clarify one thing for the committee, too? You might not be familiar with this. This is, in terms of crisis response, the lowest barrier because they do not collect data from people. If they go into this nine eighty eight approach, they're going to need to collect data from people who are in crisis. Nine eighty eight also doesn't collect data. So that is an opportunity for both a business owner could call 980 and a community member can also text you. But just the outreach. If someone's a provider If they require outreach and we can loop back to the 988 data, most are resolved over the phone.

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: So when we say data, I just want to be clear. It's like name, insurance, that kind of information. Both Community Outreach and Enhanced Mobile Crisis and 988 all collect data. That's how we get our quarterly report from the Community Outreach team. What is different is it's not really different. If someone refuses to give their name insurance to enhance mobile crisis or to nine eighty eight, there's nothing we can do. We will still serve them. They're funded to also serve the underinsured and uninsured.

[Alyssa Black (Chair)]: I would just say that my concern with this is that when you call everything a crisis, it becomes a crisis. Understood. And this is not what that is.

[Lori Houghton (Member)]: Brian?

[Brian Cina (Member)]: Yeah, it sounds like we are going to dig into this more later, so I don't want to prolong it now too much, but I do think it's an important thing just to understand what you're proposing. That it sounds like you want to you in the plural, not personal, but the administration, so it doesn't feel like it's personal or anything, the administration's recommending that we cut the funding, but then meet the need through the existing structure of crisis.

[Emily Houghton, Commissioner of the Department of Mental Health]: Can I push on that?

[Brian Cina (Member)]: Yeah, explain it more. Explain it.

[Emily Houghton, Commissioner of the Department of Mental Health]: Community outreach was put into play before September, before enhanced mobile crisis, before mental health urgent cares. And so we have those in play now. We want people to utilize them. And this is an opportunity to push the system a little bit. And change also is uncomfortable. Chittenden County is the only county in the state of Vermont that has this program. So

[Brian Cina (Member)]: then if we were encouraging people to use 988, that would mean like a business owner in Essex would call 988, get a dispatcher in the Northeast Kingdom potentially, and then that dispatcher would have to somehow understand how to activate the crisis team in Burlington to respond to Essex in an appropriate way. I'm not saying it's impossible, but that sounds like a lot more complicated and not as efficient as having a relationship directly with the local team, where you just call them, the person on duty's phone rings, they answer it, they're like, I'm one town away, I'll be there in fifteen minutes, and they show up. And they also do co respond with us for mobile crisis when it's not, just so everyone understands, there's assessments where a clinician might go alone to a home, and then there's mobile crisis responses, which are recorded differently. And when we do mobile crisis responses, a peer goes or a community outreach worker goes. So you're saying that the co responder would be some way otherwise embedded in the existing program. Like if you cut that's like, how are they going to be folded into the existing program? Who's going to do that work? Who's going be the co responder with the crisis clinician?

[Lori Houghton (Member)]: Sure.

[Emily Houghton, Commissioner of the Department of Mental Health]: Do you want to take I think you have the best answer The for the

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: co responder can be a clinician and a paraprofessional, which includes a peer support worker. So it can also be paraprofessional is the community outreach worker. It is a two person team. So I'm not Did I answer your question?

[Brian Cina (Member)]: I don't understand what difference it would make if we cut that program, but then we have to hire the staff in another program, because you still need the co responder to go with that.

[Emily Houghton, Commissioner of the Department of Mental Health]: Yeah. So I'll loop us back to work that we've done from a budget perspective and a line by line analysis of all of the programs across the agency and human services. And when we look at this line of $160,000 and we compare that to nine eighty eight enhanced mobile crisis, mental health urgent care, and the services that are available to our community members. This is a proposed reduction for that 160 ks. I'll keep us moving because we aren't even halfway through, but I certainly understand the questions and appreciate those. The next line item is a reduction for outpatient services that DMH holds for individuals on the TBI waiver. Our partner, Department Dale, continues to serve individuals with TBI. There's one individual who is a part of the DMH TBI waiver. Also, elder care and reach up. So I'll pause there. Folks who are currently engaged with these services will still have access to services. They will not be under the umbrella of elder care, TBI, and Reach Up, and that is because we see it as a duplication of services across the system. Next line item is a reduction related to the Vermont Collaborative for Practice Improvement and Innovation Training. This is a reduction for training to the overall mental health system for clinicians and other providers within the system. The next line item is related to designated agency special services. This is under or non utilized special services fund of around 7,000. It's like 74 for respite services for youth.

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: And this was attached to IFS. And so you'll see in a different slide where IFS funding went back to DCF, Dale, and so this is just eliminating funding that was not being used.

[Alyssa Black (Chair)]: Briefly, I have this.

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: Oh, integrated family services.

[Emily Houghton, Commissioner of the Department of Mental Health]: Thanks for stopping me. We talk a lot of acronyms. What is it, 1,500? Yes. The next line item is puppets in education, which is an educational component that goes around to schools and teaches young people about anxiety, depression. So we would propose to reduce that because, Well, that is funded in a way that we have to specifically target individuals who are experiencing an early mental health diagnosis. And when we are incorporating that into a broader school system, we're not able, it's a risk for us. We're not able to comply with the requirements of those dollars. Next up is care coordination for children. This was a reduction proposed last year. This is what's called Medicaid admin dollars. So dollars that clinicians and the Howard Center in Chittenden County. So this line item funds one clinician at the Milton Family Practice. The Milton Family Practice is also a blueprint practice, and so there are embedded clinicians within that practice. And the Milton Family Practice is the only practice in the state that has this one FTE funded by DMH. It also serves as some capacity funding for First Call, and the functions of the EPSDT dollars are to connect community members, children, and families with signing up for Medicaid, Doctor. Dinosaurs, and insurance. We see this as a duplication of service and can be absorbed within other case management services in the state. The next line item is a program for Washington County Mental Health, known as the Collaborative Systems Integration Project or CSIP. And this program was developed and initiated after Tropical Storm Irene to serve one individual who did not meet eligibility for TBI programming or a serious mental illness. Since that time, that individual has since moved on and Washington County is now utilizing this as an outpatient residential intervention for justice involved folks. They are the only agency that has this line item, and we would propose to reduce that. Individuals would still have access to services. They would not have access to services under this budget line item. Thank you. Safe Haven Generation Two at the Clara Martin Center is a residential program. This is a line item that they would no longer prioritize individuals who are uninsured or underinsured. Youth in transition is a grant that is held specifically in our designated agency system to serve youth as they transition to adult. We propose to reduce this line item and have those services be absorbed into the youth and family programs, as well as the adult programs, if that's appropriate at that agency. The last on this list is a proposed bed reduction at the Vermont Psychiatric Care Hospital, which is a 25 bed, currently a 25 bed hospital for adults who are receiving hospital level of care under the care and custody of the commissioner,

[Karen Lueders (Member)]: so

[Emily Houghton, Commissioner of the Department of Mental Health]: involuntary. Since COVID, that hospital has not been able to get above a census of 'twenty one, we proposed to take those four beds offline so that we are not needing to try to hire into those vacant positions or contract with travel contracts

[Alyssa Black (Chair)]: to serve that unit. So you are unable to staff the beds, not that the need is? You know, the need for

[Emily Houghton, Commissioner of the Department of Mental Health]: level one pair shifts. Level one is your highest acuity. It does go up and down. We have that availability and have had that availability over the past several years with our current contracts within Brattleboro Treat and Rutland Regional Medical Center. I believe in our slide deck is our wait time graph for folks needing inpatient care. Those beds have been offline for a while and we have continued to see folks move within around twenty four hours.

[Alyssa Black (Chair)]: I have a couple of questions, but I just want to let the committee know that we need to move along on this. So let's keep our questions contained and we can always get answers later and we will be hearing more on all of these things.

[Emily Houghton, Commissioner of the Department of Mental Health]: I'll say that the last slide, I just put those aside due to that they're not necessarily reductions, but they do show up on the reduction. So transfer of funding from VMH to DCF, that related to the IFS program, Integrated Family Services is no longer active. So we're giving money back to that program. The Arch program has since ended. And so we are returning those funds back to Dale. Inpatient hospital level one, this is specific to Rutland Regional Medical Center in that we had an underutilization of level one beds at Rutland Regional. And then lifelines for suicide prevention, this was the line item that went to the Center for Health and Learning that has since dissolved. Who's taking on their work? I believe Bam Par. It had its what? Vampar. Vampar. The Vermont Association for Mental Health and Share Recovery.

[Alyssa Black (Chair)]: And do we have line items for Vampar and NAMI?

[Emily Houghton, Commissioner of the Department of Mental Health]: No, I see not for a reduction. We do not. Those are within the ups and downs.

[Alyssa Black (Chair)]: Not an increase.

[Emily Houghton, Commissioner of the Department of Mental Health]: Not an increase.

[Samantha Sweet, Deputy Commissioner, Department of Mental Health]: Just as a reminder, we have the suicide prevention director within as well that's taking on some of the duties.

[Alyssa Black (Chair)]: Karen, briefly, don't know if

[Karen Lueders (Member)]: this is It seems like you have a map for each of these items that are on the gross budget downs. Is it possible just to put a number next to one of them, you know, regenerate the slide?

[Emily Houghton, Commissioner of the Department of Mental Health]: It is within the ups and downs. But can you, it'd be super Yes, can. And there's room for error when that occurs because the ups and downs is the official document.

[Lori Houghton (Member)]: Yes.

[Alyssa Black (Chair)]: Do we have

[Leslie Goldman (Member)]: the budget book from DMH?

[Emily Houghton, Commissioner of the Department of Mental Health]: Well, you don't have a budget book as nice as DCFs. No, I can tell you that theirs is very nice. You do not have it in the same presentation form that others have. So you have received the DMH presentation and budget information following the guidelines that we were given from the appropriations committees.

[Lori Houghton (Member)]: It would be helpful though to have something in writing that explains all of these programs, which I think was also asked in the appropriations request.

[Emily Houghton, Commissioner of the Department of Mental Health]: Yes, we will get that out to you. Thank you.

[Alyssa Black (Chair)]: Great, thank you so much. Thank you. Page pivoting. Pivoting back to age five seventy seven, if you recall, we had Jen sort of walk us through some new language, and I thought that it would be thought that would be helpful if we had a couple people wanted to see how what we're doing in this bill is affected by the changes. And I really want to start with the Bastian from D. A. Bar, It's been a long time since we've looked at the life of a pharmaceutical and I kind of wanted an overview of how things move through the system so we can have an understanding of the use of this prescription discount array Rx, and where it's affecting the system. Thanks, Sebastian, for coming in.

[Emily Houghton, Commissioner of the Department of Mental Health]: I really appreciate it. Yes.

[Sebastian Lueders, Department of Financial Regulation]: Stephanie, I was able to make kind of my schedule to feature with you today. So my name is Sebastian Lueders, and I'm testifying for the Department of Financial Regulation. I have historically brought a whiteboard to explain PBM related transactions and financial flows. And the feedback I've gotten is that people in the room love the whiteboard, but it is very difficult for people watching on Zoom or particularly people watching after the fact. So I have prepared couple of slides to help everyone visualize things as we review.

[Alyssa Black (Chair)]: Like a whiteboard app or something?

[Sebastian Lueders, Department of Financial Regulation]: There are a few whiteboard apps, but it is difficult to draw using the computer trackpads. Maybe in the future I'll have a Wacom tablet or something that I can bring and use to illustrate. Not with all the budget cuts. So where we're going to start our review today is with formularies. And by way of reminder, a formulary is a list of prescription drugs that is covered by a health plan. And I have on the screen just an example formulary that was in an article in health affairs. But the gist of what I want you to take away from this is that in

[Francis “Topper” McFaun (Vice Chair)]: general,

[Sebastian Lueders, Department of Financial Regulation]: drugs that have favorable pricing to the PBM and thus the health plan for reasons of rebating have less cost sharing to the members than drugs that have less favorable pricing. And that applies at the brand name and specialty tiers.

[Karen Lueders (Member)]: Could you just say that one more time?

[Sebastian Lueders, Department of Financial Regulation]: Yes, in general, drugs that have more favorable pricing to the PBM and the health plan, I. E. Got bigger rebates or they're able to acquire that drug Less expensively, they're able to get a better deal from the manufacturers. Those drugs will have less cost sharing for members than drugs with less favorable pricing. Okay, so before we get into discount cards, we're gonna just talk about how things work when you are using your prescription drug benefit. And what I really wanna focus on here is that as a consumer, if you're insured, there are two flows of money that come from you. So you're paying your health plan premium, but when you go to the pharmacy, you're also paying some out of pocket. You are paying your deductibles, you're paying whatever the cost sharing for that prescription drug is. And then on the health plan side, your premium goes to Blue Cross Blue Shield of Vermont, MVP, whoever. And then when you use your benefit to purchase a prescription drug that's covered under the plan, the PBM that's contracted to the plan will reimburse the pharmacy, but your health plan will reimburse the PBM. Okay, so now let's talk about what happens when you're using a discount card and how this is different than something like a manufacturer coupon. So under Vermont law, we have a co pay accumulator statute, which is a really fancy way of saying that any outside money or assistance that you have to pay your prescription drug co pays or deductibles counts towards that. But the thing with a discount card is that it is outside of this loop. You are not using your prescription drug benefit when you use a discount card. So when you were hearing testimony from Blue Cross Blue Shield of Vermont, and they said that they supported this bill and supported the use of discount cards to make things less expensive for members. One of the reasons they did that is because it also makes things less expensive for Blue Cross. And let me see if I can dig into that a little for you. So when you're using your benefit, your prescription drug benefit, the health plan eventually has to reimburse the PBM. They have to pay for that drug at some point. When you're not using your benefit, the health plan is not paying for that drug. They are only crediting you with however much you spent. And because you will only use that discount card if it is less expensive than whatever your cost sharing would be under the plan to begin with, what they're crediting towards your deductible is less than what would have been credited if you used your prescription drug benefits. Does that make sense to everyone? When you're using your discount card and it costs less than what you would have paid under your prescription drug benefit, everybody wins. With the caveat that it's very situational. The prescription drug discount card is not always going to be less expensive than what you would pay using your benefits. And for that reason, when consumers are using these cards, they have to be cautious in terms of making sure that, is this actually less expensive than using my benefit or paying whatever the pharmacist's cash price is? Might wonder, when we enacted this copay accumulator statute, wasn't there some testimony about undermining the formulary that the plan very carefully chose with their PBM. And in this case, there is not the same concern for the same reason that it is outside of the benefit. So let me see if I can explain this. When you use a manufacturer coupon, you are still using your plan's prescription drug benefit to pay your out of pocket payments. But what this allows you to do sometimes is, going back one slide, is sometimes this will allow you to be able to afford a non preferred drug. That is a drug that has less favorable pricing to the plan. So when you're using a manufacturer coupon, the plan can end up paying more. That's not the case with a discount card because the plan isn't paying anything. They are just crediting your copay or deductible.

[Alyssa Black (Chair)]: So you said something though, you said everybody wins.

[Sebastian Lueders, Department of Financial Regulation]: The consumer pays less, the health plan pays less.

[Alyssa Black (Chair)]: What I'm trying to ascertain is there is less money going into the system, everybody can't win, somebody is losing something. Who's losing? If ultimately less money is being paid for that prescription, somebody's losing money somewhere. Who is it?

[Sebastian Lueders, Department of Financial Regulation]: Right, this is one of those situations where the answer I'll have to give is it depends on the discount card. GoodRx is a prescription drug discount card And they made headlines a couple of years ago because Kroger,

[Karen Lueders (Member)]: which

[Sebastian Lueders, Department of Financial Regulation]: is a big supermarket chain in the Midwest and they have pharmacies, stopped taking their card because they were losing too much money. But ArrayRx is completely different. So to the extent your question is, who loses with ArrayRx? How does ArrayRx make money? Those are questions that I'll have to suggest you go to ArrayRx or the treasurer's office for.

[Alyssa Black (Chair)]: Great. We have someone with ArrayRx right Keep after going, Del. Sorry if I interrupted.

[Sebastian Lueders, Department of Financial Regulation]: Think I am just about done on the insurer side of this equation. So I think that a lot of times in this room, we talk about answers and sometimes there's a difference between answers and explanations. What I've tried to do here is give the explanation from the health insurers point of view, and I'm happy to take any questions.

[Alyssa Black (Chair)]: Everyone understand all the intricacies of our entire-

[Sebastian Lueders, Department of Financial Regulation]: You don't need to understand all the intricacies of the entire financial flow of pharmacy benefits because you end up with this enormous spaghetti chart. I think what's important for you to take away is that when a consumer uses a discount card, they're not using their plan's prescription drug benefit, and therefore the plan doesn't pay for the drug. And

[Emily Houghton, Commissioner of the Department of Mental Health]: yet the deductible still accumulates.

[Sebastian Lueders, Department of Financial Regulation]: Yes, but all the plan is doing is crediting that member's deductible. They're not paying anything, nothing's going out the door.

[Karen Lueders (Member)]: Yes, okay,

[Alyssa Black (Chair)]: thank you. You're welcome. Thanks, Sebastian. Oh, actually, Sebastian. Have you seen the language that was presented yesterday?

[Sebastian Lueders, Department of Financial Regulation]: If it's the same language that Jen shared yesterday, then yes.

[Alyssa Black (Chair)]: And do you have any issues with the language? Do you

[Sebastian Lueders, Department of Financial Regulation]: Yes. Have some is one thing I wanted to flag for the committee, I already flagged this in an email to Jen, but I will raise it in my testimony. So there is language on page seven on between lines eleven and fifteen that goes into that would change the definition of cash price to include the the actual amount that a individual would have paid using a prescription drug discount card. What this the idea of this is that you'd be able to get the same price with your discount card that you would be able using your benefit. So if your GoodRx card let you have drug Y for $10 your benefit would have to accept that as your cost sharing. We oppose that provision as written because, for instance, it would require PBMs and insurers to ascertain what the lowest possible price an individual would be able to obtain using a discount card, which is information they don't have unlike the the pharmacist cash price, which is already in their claims processing system, and then can be referenced against wholesale acquisition cost by the insurer. I think there's absolutely work that the PBMs and insurers can do to smooth the process of applying off benefit spending to members' co payments and deductibles. As written, this language that would modify the definition of cash price is likely unworkable for insurers and PBMs.

[Alyssa Black (Chair)]: Do you have suggestions for language?

[Sebastian Lueders, Department of Financial Regulation]: I'd like to take that back and think about it. We've had an email exchange going with some of the stakeholders and I spoke with Nancy Houghton at Blue Cross Blue Shield of Vermont yesterday. So I would say, give me a few days to mull it over with stakeholders. Great.

[Leslie Goldman (Member)]: Thank you. Quickly, yes. This is clarifying. This is like, can I

[Alyssa Black (Chair)]: just let everyone know we're going past noon?

[Leslie Goldman (Member)]: Is a kindergarten question, sorry. When you have the word individual in this, who is the individual?

[Sebastian Lueders, Department of Financial Regulation]: The covered person.

[Leslie Goldman (Member)]: The covered person. But is the covered person required to do anything? I'm thinking that they come up to their the desk and are they required to know anything? The covered person? What is that responsibility of the covered person? Yeah. So

[Sebastian Lueders, Department of Financial Regulation]: the provision we're talking about here is, it has to do with when you're using your benefits, you go to the pharmacy counter and the law says that the PBM is prohibited from charging you as covered person greater than the lesser, which is basically It basically means of the three options, whatever your cost sharing is under the plan, whatever the maximum allowable cost is for the drug or the pharmacist cash price. Whichever of those three is the lowest, that is all they can charge you. So as the covered person, you don't need to do anything. This is all, this is a part of the law that's implemented on the backend.

[Karen Lueders (Member)]: Thank you.

[Sebastian Lueders, Department of Financial Regulation]: And really the issue I'm raising is that while the claims processing systems have the mechanisms in place to determine what the pharmacist cash price is, there is no such mechanism for discount cards.

[Emily Houghton, Commissioner of the Department of Mental Health]: Thank you. Thanks for coming in.

[Alyssa Black (Chair)]: So we have on Zoom with us Trevor Douglas from ArrayRx. Hi Trevor, thanks for joining us.

[Trevor Douglas, Oregon Health Authority / ArrayRx]: Hi, members of the committee. I don't know if you do this in Vermont, but for the record, I'm Trevor Douglas. Am the Pharmacy Director for policy and programs at the Oregon Health Authority. I am also one of the co administrators and founding states of ArrayRx, the cooperative procurement group and consortium that you were just talking about, one of our products, the discount card that is in six states at the moment.

[Emily Houghton, Commissioner of the Department of Mental Health]: I was wondering if you

[Alyssa Black (Chair)]: could just tell us a little bit about what makes yours different than some traditional prescription discount cards how you work with pricing, particularly with pharmacies?

[Trevor Douglas, Oregon Health Authority / ArrayRx]: Yes, thank you, Chair, members of the committee. I really would like to just first start and say that REIREX is different in that it is governed by public sector employees from six different states. Nowhere else will you find a PBM option that is operated and regulated by the public sector where the board members of the steering committee all have a fiduciary responsibility to the taxpayers in which they serve in their respective jurisdictions and states. What makes us different in terms of a discount card program is captured in a number of different ways. We've already heard about GoodRx. I'll just say this, is that there are a number of players in the discount card space that charge access fees to even run a claim through their discount card to provide a price to a consumer, we don't do that. There are a number of discount card programs that sell patient information to other entities, we don't do that, we forbid it. So those are really key differences that we feel are important distinctions that make us very, very different from other discount card options in the marketplace. As far as pricing goes, we have a directive and a principle as Rare Rec Steering Committee pushes out our programs to honor and respect the place that pharmacies have in our delivery systems. Just as a really important point to make sure that everyone's fully aware, pharmacies across the nation deliver fifty one percent of adult vaccinations. During public health events, they play critical roles in the communities that they live to support other public health initiatives, whether that's providing medications that treat outbreaks or vaccines that curtail new incidents of disease. Without our pharmacy partners, that part of the public health system is challenged. We also recognize that pharmacies have consistently and always been there for patients and are recognized as the most trusted part of our healthcare delivery system by a number of different surveys over the past decades. So we recognize pharmacies as a really critical player in our delivery system and are working to ensure that they get fairly reimbursed for the services that they provide. All at the same time is striking a balance to try to find a competitive position so that we can operate inside of the marketplace. And so what we seek to do in our pricing models is to try to deploy strategies that do provide consumers an advantage in terms of savings, but at the same time balance that with what the pharmacy receives so that they're not filling a prescription at a loss, which often happens with some of the other discount cards. I forget all the other questions, so forgive me. Please prompt me for others.

[Alyssa Black (Chair)]: That's it. I just really wanted to highlight how this is different than some more traditional ones and particularly around your philosophy of ensuring that we're supporting our pharmacies that are so vital to our communities.

[Lori Houghton (Member)]: Anyone have any questions for Mr. Douglas? Yeah, Lori. This sounds fantastic, and I appreciate the work that you all are doing on this. I'm just curious why more states you think are not doing this, like joining your group. Had conversations with other states where they've,

[Alyssa Black (Chair)]: no, it doesn't work for us.

[Trevor Douglas, Oregon Health Authority / ArrayRx]: Yeah, members of the committee chair, if I may. This is a really good question. I think that we are currently entertaining five additional states to the current six, and we've had inquiries from other states that aren't part of that five that I'm capturing that are in various stages of engagement with us to explore and join. And so there is interest and there is, I would say, a momentum towards not just the discount card, but more importantly, the entire array of services that we put forward, understanding that this is a public PBM option, not one that is controlled by corporate interests.

[Lori Houghton (Member)]: Thank you very much for that.

[Alyssa Black (Chair)]: Leslie, quickly and then topper.

[Leslie Goldman (Member)]: Thank you. We still have two more people. Okay, Two more good. We just heard from the state of Connecticut that they had a hard time with people signing up and participating and just wondering what your experience was in Oregon and if you have recommendations as you've experienced this.

[Trevor Douglas, Oregon Health Authority / ArrayRx]: Members of the committee chair, if I may, thank you for the question. I think it's important to recognize that Oregon and Washington have over two decades of experience operating a discount card program. And so we have experienced similar challenges as it relates to enrolling people. However, we have the benefit of time on our side and a number of initiatives over decades that have made consumers aware of our card, and I think I would be remiss to share that upon rebranding as a RayRx in 2022, there has been a renewed need for Oregon and Washington to really step up the public service announcements and public awareness campaigns to ensure that they're aware that what was once the Oregon Prescription Drug Program and what was once the Washington Prescription Drug Program is now operating as a rarex. And we have seen steady enrollment numbers since 2022 that compare with enrollment numbers that predated that transition with respect to the other branded cards. And yes, absolutely, we have a program and have resources available to the state of Vermont and any other partner state to assist with outreach and engagement.

[Alyssa Black (Chair)]: Thank you. Thank you. Thank you so much for joining us at the last minute.

[Trevor Douglas, Oregon Health Authority / ArrayRx]: You're most welcome.

[Alyssa Black (Chair)]: Really appreciate it. It's early here. We have Lauren Bodie next, who's from the Vermont Pharmacists Association. Hi, good to see you again.

[Dr. Lauren Bodie, Vermont Pharmacists Association]: Hi, likewise. It's good to see you all as well.

[Alyssa Black (Chair)]: We're having difficulty hearing you.

[Karen Lueders (Member)]: Uh-oh. Maybe go into your ear ears.

[Dr. Lauren Bodie, Vermont Pharmacists Association]: Let me Oh, yeah. It's not it's not connected. Is that any better?

[Alyssa Black (Chair)]: No. Is the mic on your cord? Now we can't hear you at all.

[Dr. Lauren Bodie, Vermont Pharmacists Association]: One more adjustment.

[Alyssa Black (Chair)]: That's a little better. We'll listen carefully. Let's try it.

[Dr. Lauren Bodie, Vermont Pharmacists Association]: Okay.

[Francis “Topper” McFaun (Vice Chair)]: I think that's okay.

[Alyssa Black (Chair)]: Yeah, think you'll be good. You're good.

[Sebastian Lueders, Department of Financial Regulation]: You can't hear me.

[Alyssa Black (Chair)]: Can you not hear us?

[Dr. Lauren Bodie, Vermont Pharmacists Association]: Not anymore. How does Oh,

[Sebastian Lueders, Department of Financial Regulation]: that's good. Now

[Francis “Topper” McFaun (Vice Chair)]: we can

[Sebastian Lueders, Department of Financial Regulation]: hear you.

[Emily Houghton, Commissioner of the Department of Mental Health]: We can hear

[Karen Lueders (Member)]: you just fine.

[Dr. Lauren Bodie, Vermont Pharmacists Association]: Okay. Great. Sorry about that. We can hear you. I have a pet theory that switching from Teams to Zoom, would deliberately interfere with each other.

[Alyssa Black (Chair)]: I'm actually having the exact same problem with my laptop as well with this. Thank

[Dr. Lauren Bodie, Vermont Pharmacists Association]: you. My apologies for the technical difficulties. Yes, I'm Doctor. Lauren Bodie. I'm the legislative liaison for the Vermont Pharmacists Association who represents pharmacists practicing in any setting in our state. And I really do appreciate the opportunity to engage on this issue. I also want to extend my thanks to their ARX team who made themselves available to meet with us this morning. We just wrapped up that meeting not too long ago, so my apologies for not having testimony submitted to the committee in advance, But there was a fairly tight turnaround between our conversations. So I just, you know, my intention is really to turn this over to Doctor. Ryan Quinn, who is a cornerstone, who's the owner of a pharmacy that's a cornerstone of the health care infrastructure in Downtown Burlington, because certainly I would say he's the expert in how this is going to be operationalized in real time. From VPA, I just want to just kind of like frame how we're thinking about this issue And some questions that we that we continue to have. And I'll say that, you know, kind of first off, like as healthcare providers, pharmacists are, you know, most times the first people to have to tell a patient that the medication that they need is not affordable for them. I cannot overstate how seriously we take this issue and how keenly we feel it on a personal and professional level because of the role that we play in our medication use system. I'll also say that on a personal level, when we saw the Ray Rx proposal, I was feeling a lot of optimism in terms of, you know, it would be such a relief to have a viable option. Just another tool in the tool chest to try to address, this issue. The idea of having a discount card that we can offer that is transparent and accountable, would be an absolute, game changer. I think for certain segments of patients who are looking for ways to make their medications affordable. We did have some very specific questions for ArrayRx and thus very grateful for the opportunity to meet with them to try to get some clear answers for how this would look for Vermonters and also Vermont pharmacies. And

[Alyssa Black (Chair)]: this is

[Dr. Lauren Bodie, Vermont Pharmacists Association]: because as you saw from the testimony of from Sebastian this morning, the intricacies of medication pricing structure really cannot be overstated. And so there really are there is a high level of detail required that would enable us to know whether engagement with a program like array Rx is going to be the difference between a pharmacy staying open or a pharmacy closing and depriving that community of a valuable access point for our primary care system. We feel that we still have some of these questions that are still outstanding. And so the things that we are hoping to continue to engage on so that we can say in a in a definitive way, yes, absolutely. This is a system that can meaningfully impact Vermonters is we're looking structure for how Navitas, which is the PBM that that basically administers this program, details on that pricing structure, whether that's, you know, operating in a cost plus model or whether there's a more complex pricing structure that maybe has some variation that could be favorable or could have adverse consequences for pharmacy owners. The other thing that we're looking for is more information on what the administrative fee is because while it's well, the well stated that the administrative fee is not one that's intended to be paid by the pharmacy, It is an administrative fee that is coming out of what the patient pays the pays the pharmacy. So whether that's being attributed to patient cost or pharmacy costs, either way, this is money that's coming back from the pharmacy that's getting paid to ArrayRx. And so we'd like some. We would like to have a better understanding of what those costs are as a way of kind of like validating whether whether we think that this is going to be something that is going to be a viable solution for pharmacies in the state. And then another question that we that is like top of mind for us is one of the things that we struggle with in terms of some of the other discount programs available is mandatory participation as a part of other contracts. And so we're also looking. We're still looking for information of whether pharmacy participation in Vermont would be required if Vermont were to sign into this compact. So those are just some examples of kind of some of these specific and admittedly technical questions. But these are the kind of specific and technical questions that are really going to be the determining factor for whether this is a part of a solution to a known problem or whether this is a different mechanism that is not necessarily solving problems. And that makes sense. So I'm happy to answer any questions, but I'm also equally happy to kind of hand this off to Ryan to answer questions as well.

[Alyssa Black (Chair)]: Ryan, if you wanted to join us. Just see if you had anything to add.

[Dr. Ryan Quinn, Lakeside Pharmacy (Burlington)]: Yeah, hi. Can everyone hear me okay?

[Alyssa Black (Chair)]: I had turned up, the room for Lauren, and, yes, we can hear you fine.

[Dr. Ryan Quinn, Lakeside Pharmacy (Burlington)]: Yeah. I have that tendency. I'm a fairly, loud person. But, so, yeah, as was stated, I'm doctor Ryan Quinn. I am, the pharmacist, out of Lakeside Pharmacy, in Downtown Burlington. And I've been working in the Burlington area for the better part of thirteen years, both, you know, from being a pharmacy technician to now being a pharmacist within the community. So everything that Lauren said was spot on was done on, but I wanted to make a point of what was said or the question that was posed earlier. It was a very good question, and I think one that does demand an answer of, who pays, for this because I was thrown around of everybody wins. I can fairly confidently say there will be two modalities of, you know, individuals who pay. It's primarily going to be the pharmacy that pays, and then if but, you know, the secondary person to pay would be the patient Because in an ideal scenario, the patient would pay enough for a prescription in order to not only allow the pharmacy to, make money or even just break even. As many of my compatriots will say, we love to you know, you know, we'd love to make money, but we'll take breaking even sometimes. But in order to do that, the patient will have to pay more and to not only pay more to have us hopefully hit that breakeven or, you know, break positive point, but also to pay for this administrative fee that is absolutely going to be taken out of each and every prescription that is picked up through this discount card. An administrative fee is going to be paid and that will have to get covered by the cost of whatever, is posed to the patient when they come to pick up, which I think is a very important point, for us as we move forward with this if that is the opinion of the committee.

[Alyssa Black (Chair)]: Any questions for Karen, did you have a question?

[Karen Lueders (Member)]: Yes, I did. Hi. When you talked with them this morning, Lauren, did they mention that there would be administrative fee and roughly what that would involve? Or is that something you still need to find out?

[Dr. Lauren Bodie, Vermont Pharmacists Association]: Certainly I I'll relay with our Rx, which feels a little funny given that Trevor's right here. But yes, there is at least our understanding is there is a fee that is paid as a part of this. While we don't have a specific number for what that fee is, I think it appears that that is proprietary and so we're not, we're not privy to what that what that fee is. But there was a discussion of that there is an administrative fee. And as we were kind of walking through some hypothetical examples, based off of information on the website, it was, you know, explicitly stated that, okay, so in, you know, in this, in this circumstance, the patient is going to pay this price that's like advertised on the array RX website, and there will be a portion of that that does get passed back to Navitas or ArrayRx and it does not necessarily, it does not remain whole in the pharmacy.

[Karen Lueders (Member)]: Two more follow-up questions. One is we've heard a couple of times now that ArrayRx is pharmacy friendly and that they take into account the trust that pharmacists have among folks. And so is it that you don't know yet if they're pharmacy friendly? You still need to find out more to see if that's the case? And then the follow-up question is, is it possible that the pharmaceutical companies, the drug providers are the ones that are paying a little bit here? Or is that just not even possible? I don't know.

[Dr. Lauren Bodie, Vermont Pharmacists Association]: So this is where, know, I will admit that I am still, I think struggling with some understanding of I think the question was asked in the room is how ArrayRx is making money. And so this was I I'm I personally do not feel totally clear on that. I'm an optimist. And I do like to generally, you know, believe that I, I want to live in a world where this is absolutely a pharmacy friendly system. As someone with the information that I have currently, I do not feel that I know one way or the other. I hope that I hope absolutely that it is. This is something that I want for us as a state. It's something I want for our patients. It's something I want for our profession. I think due to the complexity and perhaps the proprietary nature of their pricing, it's not information that I have currently to be able to say with a ton of confidence. Yes. Thank you. I hope that there's maybe a path forward where maybe we can sort of get to that clarity. I just forgive me. We we don't have the information right now to be able to say that at this moment.

[Emily Houghton, Commissioner of the Department of Mental Health]: Thank you.

[Alyssa Black (Chair)]: I think we're having a little confusion around the committee when we're talking about a fee. And I want because I think some of the things Lauren said might be differing a little bit from what we've come to understand in this proposal. And I think that there's a misunderstanding of what a fee is and what it's going for. And so maybe might ask the treasurer's office if they'd like to come up and answer the question about when we're throwing around the word fee, what we're talking about. You want to spot Peter?

[Peter Trallelly, Director of Legislative Affairs, Vermont State Treasurer’s Office]: Of course. I'll actually say it's my first time testifying for legislative committee since I was 17. Wow. And it's fun to do it without having been thinking I was

[Karen Lueders (Member)]: going to.

[Peter Trallelly, Director of Legislative Affairs, Vermont State Treasurer’s Office]: But luckily, I have Trevor here until 12:30 in the next ten minutes to answer any questions that I get them wrong. As I understand it

[Lori Houghton (Member)]: Thank introducers.

[Peter Trallelly, Director of Legislative Affairs, Vermont State Treasurer’s Office]: Yes. Of course. Thank you. My name is Peter Trallelly. I'm director of legislative affairs at Treasury Pcheck's office. As I understand it, when we're talking about an ArrayRx fee, this is something that's embedded in the price that consumers will see if they bring their ArrayRx card to their pharmacy or if they search through ArrayRx's online tools to find out what the price of their medication is going to be. So it's not an added fee on top of the discounted price. This fee is tracked separately, the revenue from each state by ArrayRx, by the staff of the Oregon Health Authority who manage this program. And then the ArrayRx steering committee agrees annually to a budget for the upcoming year of the program, subtracts the operational costs from that fee revenue, returns left of a fee revenue to the states, which I am understood to be rather de minimis because this is a rather small fee. ArrayRx as a multistate collaborative, of course, does not have a profit motive for operating at cost as lean as we can so that we can keep this fee as low as possible. It's my understanding, Trevor can correct me if I'm wrong, that the more usership we see, the larger the negotiating power of this collaborative, the more we can try to bring that fee down over time.

[Alyssa Black (Chair)]: I just want to be clear. Somebody receives a price and they say to themselves, well, this is a whole lot less than I would have paid if I was going through my insurance. Embedded in that price that they're being given is a small nominal fee, which is passed on to Oregon Health who administers this and then pass through to the states based upon who used it and it's de minimis. Thank you for using that word in here the first time in the chair.

[Emily Houghton, Commissioner of the Department of Mental Health]: I love that word.

[Alyssa Black (Chair)]: And there is no It's not like people go to the pharmacy with this discount and then they say, Oh, you've got to pay a fee to use that. It's embedded in the price.

[Trevor Douglas, Oregon Health Authority / ArrayRx]: That is true.

[Alyssa Black (Chair)]: Okay, so I'm understanding.

[Peter Trallelly, Director of Legislative Affairs, Vermont State Treasurer’s Office]: That is correct.

[Leslie Goldman (Member)]: But does that mean it comes out of the pharmacy?

[Francis “Topper” McFaun (Vice Chair)]: Yes.

[Dr. Ryan Quinn, Lakeside Pharmacy (Burlington)]: The pharmacy pays it.

[Alyssa Black (Chair)]: Well, they

[Peter Trallelly, Director of Legislative Affairs, Vermont State Treasurer’s Office]: Just to be clear, the consumer pays the fee. The pharmacy fee. Revenue then, when if a drug costs $8.50, the pharmacy is not keeping all that $8.50. A small portion of that is going to ArrayRx for the fee, but it's paid out of the consumer's profit, although it does in that sense, that's a margin that's not being taken in by the pharmacy. Other cards, if I may, like GoodRx, as I understand it, charge an access fee to pharmacies to run the card transactions. ArrayRx does not.

[Trevor Douglas, Oregon Health Authority / ArrayRx]: If

[Francis “Topper” McFaun (Vice Chair)]: I may?

[Alyssa Black (Chair)]: Yes, please.

[Dr. Ryan Quinn, Lakeside Pharmacy (Burlington)]: No. I'm sorry not to be like so blunt with it, but at the point of the transaction, so the pharmacy will run the claim and it will say to me, hey, charge the patient, let's say, nice even amount, $10. Charge the patient $10 on this medication that cost me $2. What the patient won't see is that they would also be telling me, okay. But also pay this PBM, you know, let's say 1 to $2. So the patient will not see this and they will not interact with it in any way, but I regardless of whatever discount card that is brought forward, and this is corroborated by my calls that I had made to pharmacies in states that do already use this, the pharmacy is paying these people like that is how the money is being made. The pharmacy is paying. The patient pays the pharmacy, but then the pharmacy then pays for this.

[Alyssa Black (Chair)]: It gets taken out of what the patient paid. But the amount the patient is paying has the fee embedded into it. So if it didn't have a fee, it would have been a little bit less. Or

[Dr. Ryan Quinn, Lakeside Pharmacy (Burlington)]: even Oregon to go so far as to say, if that fee wasn't in there in the first place. If the if pharmacies were just allowed to set, you know, prices, which part of the issue is that pharmacies, you know, given the lack of transparency with some pharmacies, that they just kind of set these arbitrarily very high prices, you know, maybe not arbitrarily, there is obviously a method to it but it is still very very high. That without that fee, the pharmacy could charge the same price and then not lose money to paying someone else to set whatever price they're saying to set. You know, is a thing that impacts independents more so than you know chain pharmacies who the pharmacies at the time don't see these fees and it's just their setup is just very different from the software standpoint. The pharmacies pay to set these prices.

[Alyssa Black (Chair)]: I was wondering if Trevor was still here. I know we only have him for a couple minutes, but Lori had a question.

[Lori Houghton (Member)]: So is this process that ArrayRx has on the table any different than what's happening with other discount cards that are out there?

[Dr. Ryan Quinn, Lakeside Pharmacy (Burlington)]: Not that I have seen, not that I have had told to me by other states who are currently using this.

[Lori Houghton (Member)]: Okay, there's a fee throughout each one.

[Dr. Ryan Quinn, Lakeside Pharmacy (Burlington)]: Yes, the consistent thing that I have heard for the pharmacies that I've spoken to and I have spoken to, I'd say I called about at least 10 in each state, was that there is a fee that is associated with it. An administrative fee for these prices to be set, but the pharmacy is paying a certain dollar amount.

[Trevor Douglas, Oregon Health Authority / ArrayRx]: If I may.

[Alyssa Black (Chair)]: Yes please, Trevor, if you wanted to weigh in.

[Trevor Douglas, Oregon Health Authority / ArrayRx]: Yeah, Chair, members of the committee, thank you. I will say fundamentally speaking, Doctor. Quinn is correct. There is a administrative fee associated with discount card claims. There are other discount cards that charge access fees that the pharmacy pays that are not part of the transaction that we utilize. But I will just restate, I think your understanding chair and some of the others around the table and what Peter articulated. The intention is that the fee is part of the total price that is advertised on the ArrayRx Rx tools site and that fee is part of the payment made to the pharmacy. Yes, Doctor. Quinn's correct, that part has to be paid to the PBM by the pharmacy. So the true net to the pharmacy is that total amount minus the admin charge. So if it's $10 claim and there's a dollar and a half, you're looking at $8.50 that the pharmacy retains. Hopefully that answers and clarifies what was being shared.

[Alyssa Black (Chair)]: I think so. Thank you. I really appreciate you being here. I think I'm going to thank every, can I just say one I'm sorry? One thing. And so I just

[Francis “Topper” McFaun (Vice Chair)]: my hand up too.

[Lori Houghton (Member)]: Okay. Go ahead. You go. I won't go.

[Francis “Topper” McFaun (Vice Chair)]: Oh, go ahead. You go.

[Peter Trallelly, Director of Legislative Affairs, Vermont State Treasurer’s Office]: Feel like I'm gonna stop signing. Okay.

[Leslie Goldman (Member)]: Okay. No.

[Alyssa Black (Chair)]: There are two.

[Brian Cina (Member)]: Somebody go. I'm gonna go. I'm gonna go

[Francis “Topper” McFaun (Vice Chair)]: right now.

[Brian Cina (Member)]: Yeah. Go. Go. Go.

[Francis “Topper” McFaun (Vice Chair)]: Alright. First of all, that's not what we heard from the treasurer. At least I didn't hear that. I heard him say there were no fees. And I also heard him say that we've gotta get in this thing quick because up to a certain point, you don't have to pay any fee. After that, you're gonna have to pay a fee. Am I right when I heard that?

[Peter Trallelly, Director of Legislative Affairs, Vermont State Treasurer’s Office]: I believe that what the treasurer may have been saying there is that there are no membership fees to sign up for the card. I think some of these other cards, you pay $25 at the time you sign up for the card, and there is no such fee for Rx, though there is the embedded fee in the transaction. And Trevor can correct me if I'm wrong. I believe that the collaborative is considering charging states a fee in the future to become members Yeah.

[Francis “Topper” McFaun (Vice Chair)]: But he wouldn't have to pay that.

[Peter Trallelly, Director of Legislative Affairs, Vermont State Treasurer’s Office]: Indeed. And I believe my understanding is that we would not have to pay that as a state.

[Lori Houghton (Member)]: My last comment, I just want to say to Lauren and Ryan, we in this committee are very understanding of the issues facing pharmacists with the way PBMs and others do pricing. So unfortunately, that's not what we're trying to fix here. But do know that we are understanding I

[Alyssa Black (Chair)]: was going to mention that ultimately, this is a system that is not working for patients. And here, we're trying to help patients and we certainly understand the issues around pharmacies which is a much larger issue. Going to thank everybody for joining us. I really appreciate it. We can go off of live and I will see everybody back here in thirty minutes.