Vermont Legislature SmartTranscripts:

[Alyssa Black (Chair)]: Hi, welcome. Afternoon, January 25, House Healthcare. And we are going back to five 80 five today, H585. And we've had some language changes with some working with Ledged Council on various items along with our Department of Financial Regulation, and we're gonna walk through those changes and some official testimony.

[Jennifer Carbee (Office of Legislative Counsel)]: Ben, you wanna come on up? Good afternoon. Jen Carvey from the Office of Legislative Counsel. I will put this new draft, which we posted, will be put on the screen. Alright. So this is a strike all amendment to h five eighty five. As with some other bills we've looked at this year, I've done this in deep markup so that you can see the changes from the bill as introduced. Couple cases I made changes within new sections. And since a few people had seen the kind of unedited draft, I included those in full and highlight as well. So section one is still on health insurer, governance, and executive compensation. The first change I made here is really just to put in a little placeholder. If you remember, the bill, as introduced, called for two representatives of the public appointed by the governor to be on the board of a nonprofit hospital service corporation, which is part of our statute speak for what is Blue Cross Blue Shield of Vermont. And there had been talk about whether that should be not just the governor, maybe some legislative involvement, maybe some kind of a nominating process. So I put a placeholder in here in a few places for you to come back to that concept. And then the executive compensation piece, DFR can ask for a little tweak in the language. So if you remember in the executive compensation, DFR is supposed to get a lot more information about how compensation is set for the executives of a nonprofit hospital service corporation and that those corporations would have to file with DFR once and then prior to approving any changes in the future, a statement sworn by the Chair of the Board of Directors and the President of the Corporation with certain information. So first, I've just made this existing in the bill existing subsection b b one and moved everything down a level to in order to put in a new two that would say all information provided pursuant to this subsection shall be sufficiently detailed to allow for a comprehensive examination of the benchmarks and to enable the Commissioner or designee to perform independent computations to evaluate the benchmarks provided. So different benchmark information about other potentially comparable individuals or executives and their compensation is provided. And so all of that has to provide enough detail so that DFR can use that information to look at it and determine whether the benchmarks are appropriate. No changes to Section two, which is just a timing implementation around amending bylaws. Then the bill, this version would strike the limited age rating language. So it wouldn't make remember, there were three sections that just made a little tweak to the language to allow some kind of age rating to occur. And then one of them directed DFR to look at its rules and amend its rules and guidance as needed to allow some a small amount of age rating in insurance plans. And this would take out that language, and I think you'll hear some testimony on the rationale behind taking that language out. Then we've got some sections that were in the bill as introduced, and the only thing that's changed is just the section number to reflect the removal of those sections on age rating. We still have expanding access to association health plans and two sections on association health plans. So that's now three and four. Section five is still on expanding access.

[Alyssa Black (Chair)]: Are we doing questions now or later? If you have a question for Jen, sure.

[Hilary (staff/counsel)]: Can you just remind me on

[Lori Houghton (Member)]: the Association of Health Plans, there still has to be something done at the federal level for this

[Alyssa Black (Chair)]: to be claimed or kept?

[Jennifer Carbee (Office of Legislative Counsel)]: I don't, but I would have to defer to TFR. I don't I don't recall what the changes are. Alright. Section five is the short term limited duration plans and expanding access to those. Section six is the high dollar claims, defining high dollar claims for claims edit purposes. Then this would remove what had been Section 11 in the bill as introduced, which is on limiting the prior authorization exemptions for primary care. And that proposal had been to have only independent physician practices be exempt from the prior authorization requirements. And this takes that out so it would continue to apply to all primary care providers for the things that are subject to that exemption. So the exemption still under existing law does not include prescription drugs or anything provided out of network, but this whole section is coming. That's why it's being the whole thing is being struck. It's not taking those sections out of the law. Then we have a couple of new sections dealing with site neutral billing. This would narrow the scope to be just site neutral billing for physical therapy or physical therapy services. And so it strikes out the original site neutral billing language that had been in the bill as introduced and instead puts in two new sections. And after I drafted this, I wasn't sure if it supposed to be physical therapy services or items and services. So I went back in and took out references to services so that it was items and services. But you may hear testimony suggesting it should be just one or the other. So this would add a new section in Title 18 in the Fair Contract or Claims Processing and Contract Standards subchapter on-site neutral reimbursement for physical therapy. This would require each health plan, which is a defined term in that subchapter, to establish and pay reimbursement amounts for all physical therapy items and services provided to its insureds that are uniform and consistent. So a couple of word changes since the earlier version I sent around, that's why some of these are highlighted. That are uniform and consistent across all of the plans, contracts, and fee schedules. And then giving an exception, accepted plan may reimburse different amounts for physical therapy items and services delivered in an inpatient setting. It was just looking at anything that would be done in a non inpatient setting. And I'm not using the word outpatient because I think sometimes that has particular meaning when it comes to fee schedules. So different fee schedules, one of which may be outpatient, others may be professional. Trying to get all of those reimbursing the same amounts for physical therapy items and services and requiring health plans to express each reimbursement amount as a percentage of the Medicare rate for the same item or service. Section eight would require that by 03/01/2027, each health insurer that is required to make site neutral reimbursements for physical therapy and adding in items and services under that previous section would provide an update to this committee and the Senate Health and Law Fair and Finance Committees regarding its implementation of the site neutral reimbursements, any trends or other financial impacts it has identified so far as a result of implementation, and any recommendations regarding the enactment of additional site neutral reimbursement requirements. So starting out with just site neutral for physical therapy, getting a report back after about five months, five or six months, see how it's going. And that may also help inform your work next session or whoever's here next session on additional site neutral reimbursement for modifications. Take out the language on the that had been in the bill as introduced on the Section thirteen thirty two reinsurance waiver because that language is going into the budget. There was a version of that language in the governor's recommended budget. You had a slightly different version that came out of or that was that went into this piece in H five eighty five and actually even a slightly different version because we took out the reference to pass through cost sharing reductions. So that language that I think was the most agreed upon version is what you recommended in your letter to the Appropriations Committee and hopefully will be what is substituted if they choose to include a reinsurance provision. Section nine would eliminate the prescription drug specific out of pocket maximums that are in statute. So this is currently current statute in eight BSA section forty ninety two, but this is a new provision to H five eighty five. And under existing law, first, and this wouldn't change that, a health insurance plan cannot include an annual dollar limit on prescription drug benefits. But also under existing law, there's a limit on health insurance plans, or that health insurance plans have to limit a covered individual's out of pocket exposure for prescription drugs to not more than the minimum federal limits for a plan to qualify as a high deductible plan under federal law. So that sort of indexes over time. And I don't know if DFR folks remember if it's, it was $1,500 for an individual and it may be slightly more than that at this point. But it set a lower threshold for prescription drug expenditures before insurance kicked in then would apply without this state specific limitation. And then I had kind of a carve out saying, if somebody is on a high deductible plan, then this coverage doesn't kick in until they have satisfied their deductible, except to the extent that the federal law would allow first dollar coverage for something before that because of the requirements around what a high deductible plan has to do and not do in order to be eligible to be paired with a health savings account, all federal law. So to resum up this section, there are some existing limits on out of pocket expenditures for prescription drugs. This section would eliminate those specific out of pocket maximums for prescription drugs. And I think you'll be hearing from Diva later. My recollection is that without this provision, there are still out of pocket maximums, but it's a combined medical and prescription drug out of pocket maximum. And I know this issue, this coverage piece came up with some regularity a number of years ago when there were some difficulties in designing bronze plans in the exchange or qualified health plans that could satisfy this limitation and still meet the actuarial value requirements. So a lot of different implications of doing or not doing this change. And I think hopefully you'll hear more about from Debra. How long has this been

[Alyssa Black (Chair)]: reflecting on when this was put in? I drafted it, but it was fairly early on

[Jennifer Carbee (Office of Legislative Counsel)]: in my time here. So let's say approximately fifteen years. Just before the ACA stuff, but not by a whole lot. Then this, what would be new section 10, pulls in language from h one zero two that we talked about a bit the other day around health care sharing plans and arrangements. And this is language that, as I said, was largely H-one 102. A couple of updates. It changed where in statute it would go from where I had originally put it in H102 to give it its own larger chapter on health care sharing plans, although still with one section. And I updated the dates because it was a 2025 bill. So this is the reporting. This would require a person who's not authorized by DFR under the various health insurance chapters of Title VIII to offer insurance in this date that offers or intends to offer a plan or arrangement to facilitate payment or reimbursement of health care costs or services. Residents of the state, regardless of whether they are domiciled here or in another state, must submit a lot of information to the Commissioner of DFR on or after 10/01/2026, and on or after March 1 each year after that. Information about how many individuals and households participated in the plan in the previous year, how many employer groups, if they are offering a similar plan arrangement in other states, how people participate nationally, any contracts that the plan is entered into with providers in Vermont, total amount of fees, dues, or other payments collected by the person in the immediately preceding calendar year, and how much they they it all says in person, but it's person in the larger title one concept of individual or entity or corporation. So looking really at sort of the plan or arrangement as we were talking to as a person. Total dollar amount of requests for reimbursement of health care costs or services submitted in this state. Total dollar amount of requests that were submitted and were determined to qualify for reimbursement under the plan, total dollar amount of payments made to providers in this state in the previous year for health care services provided to or received by plan participants. Total dollar amount of reimbursements made to plan or arrangement participants in the state for services provided to or received by them. Total number of requests for reimbursement that were denied expressed as a percentage and the total number of denials that were repealed, total dollar amount of healthcare expenses submitted in the state by plan or arrangement participants or providers that qualify for reimbursement but had not been reimbursed as of the end of the calendar year. Estimated number of participants, the person anticipates in the state in the next year. List of other states where they offer a plan or arrangement. List of any third parties other than a licensed insurance producer that are associated with or assist the person in offering or enrolling participants, copies of training materials, and detailed amount of detailed accounting of payments for various marketing, promotion, enrollment, operating, managing, or administering plan, total number of licensed insurance producers associated with or assisting the person in offering or enrolling participants in Vermont in the Planner Arrangement and some more information related to that relationship. Copies of any consumer facing and marketing materials used in the state to promote the person's Planner or Arrangement. Name, mailing address, email address, and telephone number of someone serving as a contact for the person in the state, list of any parent companies, subsidiaries, and other names the person operated under within the previous five years, and an organizational chart. And then a certification by an officer that, to the best of the person's good faith, knowledge, and belief, the information is accurate and satisfies the requirements of the subsection. If someone who should be reporting under this section fails to submit the information required, the submission is incomplete, the Commissioner would make a determination of completeness within forty five days. If the Commissioner doesn't inform the person of any deficiencies within forty five days, the submission is deemed complete. If the Commissioner determines the person has failed to comply with the requirements, the Commissioner shall notify them and enumerate each deficiency found, allow them thirty days to remedy the deficiency. And then if the person does not remedy the deficiency within the thirty day period, the Commissioner can impose an administrative penalty of up to $5,000 per day. The person doesn't remedy the deficiencies within thirty days after the initial penalty is imposed, the Commissioner can issue a cease and desist order. And then on or before 04/01/2027 and by October 1 thereafter, the Commissioner will prepare a written report summarizing the information submitted, posted on the Department's website along with accurate and evidence based information about the persons who submitted information, including how consumers can file complaints. And it allows the Commissioner of DFR to adopt rules as necessary. Finally, have the effective date. Most of the bill would still take effect on 07/01/2026. But Section seven, the site neutral reimbursements for physical therapy would take effect on 10/01/2026 and apply to physical therapy items provided and services delivered on and after that date.

[Alyssa Black (Chair)]: Great. So I just want to clarify the lot of things in section 10. Yes. We hadn't gone through it. Monica goes through. But we're just saying that they have to report to DFR. They're doing business in the state and they have to tell DFR all this stuff. Right. If they

[Jennifer Carbee (Office of Legislative Counsel)]: are not authorized, licensed as an insurer, but they are providing provider intent to provide a plan or arrangement that pays for health care costs, then yes, they have to report certain information to the commissioner. And then the commissioner would aggregate and report that as well or post that on the website.

[Alyssa Black (Chair)]: Any questions for Jen? Anything we just walked through? Brian, do you have a question, or were you just

[Brian Cina (Member)]: contemplating something? I saw Copper's fingers wiggling. Was doing that.

[Daisy Berbeco (Ranking Member)]: Yeah, go ahead.

[Leslie Goldman (Member)]: Just tell me, this supposed to be some kind of an analysis or a report that would come back about the physical therapy?

[Jennifer Carbee (Office of Legislative Counsel)]: Yes, there is in new section eight on page 24 would require insurers by 03/01/2027 to provide an update to your committees on implementation.

[Brian Cina (Member)]: My question was from earlier in the bill, and that's what you were observing. I think I'm looking at the right track. You have in the section about the boards of hospitals, you have a section flagged about the process. Boards of

[Alyssa Black (Chair)]: domestic, what do we call?

[Brian Cina (Member)]: Nonprofit, oh, I was talking about the nonprofit hospital service corporation. In that section, it's saying like representatives of the public appointed by the governor, but then it's like in yellow, legislative process question mark. The question I have for you is what is the body that currently recommends to the governor people for the Green Mountain Care Board called.

[Jennifer Carbee (Office of Legislative Counsel)]: Green Mountain Care Board nominating committee? Wait, I'm creative, it's literally, it's a policy. And

[Brian Cina (Member)]: their only job is to recommend candidates to the governor for that position of Green Mountain Caribou.

[Jennifer Carbee (Office of Legislative Counsel)]: Yep, it goes through the qualifications. So

[Brian Cina (Member)]: I'm going to ask a question, but then I think it's going to lead to discussion later, which is- Can

[Alyssa Black (Chair)]: I give some context first before you ask the question? Can you? Just because it may change Yes. Your I was the one that asked for this because I really just wanted one appointed by the governor and one appointed by the legislature, the speaker, the pro tem. Oh, I see. But you mean by that? I thought it was an easy process, and legislative counsel advised me that there wasn't precedent for that sort of No, if you want

[Jennifer Carbee (Office of Legislative Counsel)]: to have somebody appointed by the legislature, that's fine. We can put that in there. What had been brought up was creating a new nominating committee or having a nominating committee of any sort that would be vetting candidates recommending to the governor for a non public position. So for a position on private board.

[Alyssa Black (Chair)]: The piece that is unusual.

[Brian Cina (Member)]: So my question to you was, if the only job of the Green Mountain Care Board nominating committee is to nominate people to the Green Mountain Care Board, my guess is the answer is yes, but I'm just checking. Could we say they are like the something nominating committee and they have two jobs? They recommend candidates to the governor for both Green Mountain Care Board and the hospitals so that we're not creating another working group or board. We're just asking an existing body to take on a task related to what they already do. Cause then they can just build a bench of good candidates for boards that they pull from.

[Jennifer Carbee (Office of Legislative Counsel)]: And I'm not sure it's the same skill set or that you would have the same you're looking for the same expertise. We can certainly look at that. We can pull up the sub chapter on the Green Mountain Care Board nominating committee, but those are nominating people for full and two thirds time state positions as opposed to

[Brian Cina (Member)]: It's very different position is what you're saying.

[Jennifer Carbee (Office of Legislative Counsel)]: It's a very different way.

[Brian Cina (Member)]: That's why I wanted to ask you about it.

[Jennifer Carbee (Office of Legislative Counsel)]: So you certainly can, and we can borrow from that existing process if that's what you want. But I think there are some fairly significant differences that you should just be mindful of. It wouldn't be

[Alyssa Black (Chair)]: as easy as I thought.

[Jennifer Carbee (Office of Legislative Counsel)]: I think it could be from a drafting standpoint, it might not be that hard, but from a policy standpoint, usually give it some thought.

[Brian Cina (Member)]: Well, that's why I think it's gonna leave This this

[Alyssa Black (Chair)]: is gonna be easy on Yeah. Yeah. Turns out

[Brian Cina (Member)]: That's why my question.

[Jennifer Carbee (Office of Legislative Counsel)]: I used to say one is appointed by the governor and one is appointed jointly by the speaker and pro tem. I think that is very easy. If you wanna create a process, then you have to think about what the process

[Alyssa Black (Chair)]: All looks

[Brian Cina (Member)]: right. Well, we don't

[Alyssa Black (Chair)]: need to get into

[Brian Cina (Member)]: it now, that was my question. And then the other

[Jennifer Carbee (Office of Legislative Counsel)]: That's why I have legislatureprocess. So one was sort of looking at having a legislative appointee, and one is, do you want it processed?

[Brian Cina (Member)]: The other thing that stood out to me that's not that important, but I'm curious about is why the United Townsend Gors of Essex County is specifically named the way it is.

[Jennifer Carbee (Office of Legislative Counsel)]: I don't recall where that is.

[Brian Cina (Member)]: I'll look for it. You know it's in certain places. It stood out. Was like, why are we naming this one particular municipal entity

[Alyssa Black (Chair)]: in

[Brian Cina (Member)]: Central And then I never heard of the United Towns and Gores of Essex County. It's like a

[Jennifer Carbee (Office of Legislative Counsel)]: There you go. Employer. So this is in the existing statutes around group health insurance policies. And it talks about employer, under existing law, is deemed to include any municipal or governmental entity or officer or the appropriate officer for an unincorporated town or gore or for the unified towns and gores of Essex County, but just different municipal government structures.

[Brian Cina (Member)]: So that's a unique municipal structure that has to be named because it doesn't fit into the other definition?

[Jennifer Carbee (Office of Legislative Counsel)]: I assume so, but I would want to bring in my colleague, Kathryn Anderson, to talk about municipal law in the United Unified Towns and Boards of Essex County, if that is a direct

[Brian Cina (Member)]: It's not that important. Read things, I read it, and I saw it, and I was like, that's a cool name. Wonder what this is about and why they're named so specifically. Thank you.

[Alyssa Black (Chair)]: We've never had Tucker in this committee. So maybe we could I wouldn't mind bringing Tucker for Houghton. No, we're not bringing Tucker.

[Brian Cina (Member)]: He did write the first AI bill, so maybe he could also speak on that.

[Jennifer Carbee (Office of Legislative Counsel)]: Okay, certainly space for public records issues.

[Alyssa Black (Chair)]: Any other questions for Jen on language or what we're seeing? Okay. Thank you, Jen. Let's walk through some of the changes with Commissioner Sampson. Hello again? Hi. Welcome back. Yeah.

[Commissioner Sampson (Department of Financial Regulation)]: Hi, Sampson. Commissioner of DFR. How would you like to proceed? Do you want me to kinda go through my thoughts on the markup, or do you wanna

[Alyssa Black (Chair)]: Yeah.

[Mary (DFR staff, Insurance/Policy)]: So well, why don't we start with

[Alyssa Black (Chair)]: First of all, in the first two sections where Jen has just led the process, because you had suggested something which I thought was great, but I think that it was a little

[Mary (DFR staff, Insurance/Policy)]: bit more difficult to implement. Right.

[Daisy Berbeco (Ranking Member)]: So you

[Alyssa Black (Chair)]: wanna talk about what your suggestion was?

[Commissioner Sampson (Department of Financial Regulation)]: Right. So I think our position is we we prefer to have these preserved in this original bill as, governor appointees. However, having a nominating process or some level of influence from the legislature seems appropriate and fair. So I I proposed, you know, a a nominating committee of sorts of, AHS designee, DFR designee, Green Mountain Care Board designee, senate designee, house designee. That's five people, two from the administration, one from an independent board with a unique independent board nominating committee I just learned, and then two and then two from the legislature. So, yeah, I I can't comment on precedent or how hard or easy that is to facilitate or whatever or put into law, but that seemed like that that's something the administration's comfortable with.

[Brian Cina (Member)]: I'm just curious why this is about the position, not the individual, why the governor would be the one picking who goes on the boards? Why is that important versus some other entity choosing, being the deciding entity to rid of?

[Commissioner Sampson (Department of Financial Regulation)]: I think it follows precedent in terms of a lot of boards, but as was mentioned, Green Mountain Care Board, I believe, are all nominees of of the governor with the nominating process. I believe the University of Vermont, I believe those are governor nominees. Not I mean, not nominees appointees. I'm not sure of the nominating process. You know, I I I think logistically maybe having an opening in July might cause some timing challenges for the legislature to you know, I'm not sure how that would work as far as calendar issues like that. And, you know, and I think there's a recognition with board appointees or, you know, supreme court appointees, you know, that that's not necessarily even though it looks partisan for any given point point in time with a different governor from a different party, over time, it has its own diversity of of party influence if there's gonna be party influence. Right?

[Brian Cina (Member)]: Yeah. Do you know how many appointed position how many positions in the state government are appointed by the governor?

[Commissioner Sampson (Department of Financial Regulation)]: I do not.

[Brian Cina (Member)]: I don't I'm not asking this of a witness now, but it's like a question for the universe to perhaps answer for us is, I'm curious how many positions in government are appointed by the governor or the governor's administration versus other entities and what that ratio is, because I'm just curious how much power we're giving the executive branch over these structures of government. It's not something we're going solve in this bill, it's not a deal breaker, I'm not that attached to the outcome. It just raises the question, because I was questioning why, and it sounds like the why is because what's done. And now I'm curious exactly what's done.

[Jennifer Carbee (Office of Legislative Counsel)]: Can I just clarify, this for a private board? These are not for state, maybe not for government agencies.

[Alyssa Black (Chair)]: And because it's for a private board, that's actually why I had suggested that I thought that it would be a bit more fair if there was some sort of legislative process and also some administrative process. I'm just not quite sure how to get there as easily as possible. Or whether or not the committee as a whole

[Daisy Berbeco (Ranking Member)]: could care of. Can I

[Alyssa Black (Chair)]: ask a follow-up? Ask a follow-up and then I got Allen.

[Brian Cina (Member)]: It's for Legis Council, because as you said, that you pointed out that this is a private board. Are you aware of how many private boards the legislature or governor has appointing powers on?

[Jennifer Carbee (Office of Legislative Counsel)]: I am not. I reached out to colleagues yesterday to see if anybody had familiarity with the people that a nominating process for a private board and anybody responded. So I couldn't easily find anything just looking around through nominating the process before I started looking at Premier or Public Utility Commission works. But all of those also involved a Senate consent, the vice president, the Senate, which is different. Thank you.

[Alyssa Black (Chair)]: Oh, Allen.

[Allen "Penny" Demar (Member)]: Well, I guess I don't understand why or what the benefit or advantage is of having two public members being appointed by anybody on a private board.

[Alyssa Black (Chair)]: You wanna Yeah.

[Commissioner Sampson (Department of Financial Regulation)]: Great. Our original testimony kind of brought to the table that the current board nominating structure, this is first of all, I'll say, yes. It's a private entity, but it's also, a quasi public entity as deemed by, the Vermont Supreme Court in several, court cases over the years. They are Vermont only entity. They are a nonprofit. And the, motivation for the bill as we proposed it, was to exert some influence from a more of a public policy and statewide Vermont point of view in how that entity is governed. There are, as you see in in the bill, there are questions from the general public, from the media, and from subscribers, and from regulators about compensation practices and whether they're appropriate. Those are in in a private entity determined by a board, you know, executive compensation. They have a board of, I believe, 11 or 12 at this point. 12. Phone a friend. And, you know, we suggested two or no no less than one sixth to infuse a different perspective, a perspective that's elaborated in the language in terms of thinking about health care transformation and the state as a whole. But I also wanna say that Blue Cross generally has been sensitive to those. We want them to be more sensitive to those in terms of their governance. So that's that's where the idea came from.

[Lori Houghton (Member)]: You seeking feedback on whether or

[Jennifer Carbee (Office of Legislative Counsel)]: not we agree with them, or

[Alyssa Black (Chair)]: are we just answering the question? I'm seeking feedback on I think now I'm seeking feedback on whether or not we feel as though it's appropriate at all that a publicprivate entity should have some influence on the board, and also whether or not anyone particularly cares about who gets to put those members on the board. You could speak to

[Lori Houghton (Member)]: either one officers. I'd love to speak to that. I think because of all the reasons the commissioner just said that, yes, we should have

[Jennifer Carbee (Office of Legislative Counsel)]: two people on this board.

[Lori Houghton (Member)]: And I also think because guiding principles are directly listed in the intent of this to direct these two representatives of the public that I'm comfortable with it being a judgment Right.

[Commissioner Sampson (Department of Financial Regulation)]: Okay, I

[Brian Cina (Member)]: was gonna write it down, by the way. I don't know how long you were

[Commissioner Sampson (Department of Financial Regulation)]: gonna talk, I was trying

[Brian Cina (Member)]: not to interrupt. I agree, and I would add that to what Lori said, that I think the reason I agree is that, one, the state invests a massive amount of public dollars into our hospital and healthcare systems. So, we have a stake in their success. Two, that this is just my belief that healthcare should be treated as a public good. And if we look at our statute and our principles of healthcare reform, they kind of are in line with that still, the remnants of Act 48 that passed. And so, the spirit of that, I feel like this is a step in the right direction of acknowledging that our hospital system is funded by taxpayer dollars, it's a public good, and that the public has so much of an important stake in it that representatives of the public have some appointing power over the board. It's only a piece, it's not a controlling ratio of the board, we're not taking over the boards, we're just asking to have a say in making sure that there's a voice there, and I am hearing there's agreement with the administration on that, so it feels like a win win situation. You.

[Commissioner Sampson (Department of Financial Regulation)]: Give us four of your back votes.

[Alyssa Black (Chair)]: Go ahead, Allen.

[Allen "Penny" Demar (Member)]: Will we be setting the precedents for other areas of government for this?

[Commissioner Sampson (Department of Financial Regulation)]: I have I have

[Alyssa Black (Chair)]: to see

[Commissioner Sampson (Department of Financial Regulation)]: Well, and I I think your question is, are we charting new territory and setting a precedent that maybe some people aren't comfortable with? I would say there is there is no other well, I'm not aware of any other entities as uniquely situated as a nonprofit hospital medical service corporation, which is specifically enabled by statute, a nonprofit single state, entity like that. So I think from a precedent setting point of view, I don't have concerns with that, but I understand the concern.

[Alyssa Black (Chair)]: I will just say that I wholeheartedly think that this should be done. I want to remind people that just a year ago, sitting around this table, we had to pull levers in the state because of the governance around Blue Cross Blue Shield. And that took state dollars, state resources, agreements with hospitals, interaction with Green Mountain Care Board. The EFR was involved in all of that. I've become a firm believer in that boards set the tone and set the mission and the goals of the entity of which they are board members. And if any organization needs members of the public who are solely there to think about the state of Vermont as a whole and the influence that that entity has on the entire system of healthcare in the state of Vermont, I think that that should happen. Because somebody has to speak to that. Do you remember the cataclysmic things that we were having to hear about if Blue Cross Blue Shield failed for the entire system, not just themselves? Also how it will affect people. How it affected everybody. So you're good with leaving it just to the governor. No, Lori, you're good with leaving just to the governor.

[Brian Cina (Member)]: I can't expect that.

[Alyssa Black (Chair)]: Does anyone have a burning desire to not allow the governor to take one toothpicks, but rather one? I'm not willing to I don't care enough about it. I just go out and say that think it's imperative that we do this and I'm not willing to fight for it. So if the consensus around is that government goes back to the original version, I'm fine with that. Oh, go ahead. Oh, no, go ahead. For

[Daisy Berbeco (Ranking Member)]: all the reasons you stated, it's really important to have these two people on the board. And I kind

[Alyssa Black (Chair)]: of liked the idea

[Daisy Berbeco (Ranking Member)]: that because we do represent the people statewide, I kind of like the idea of one of the nominees coming from the legislature. I don't object to that at all. Think that's fine. If it's just too complicated, and at the end of the day, the important service of two people looking out for promoters in their healthcare is what ends up happening, that's fine. But I kind of liked the idea of the legislature being involved. I'm with Alyssa and I'm with Karen too.

[Alyssa Black (Chair)]: One from each, or both from the legislature. Would it be, I don't want to say easy, but would it basically just say that the governor takes one pick and then another pick by the speaker of the pro tem? Would DFR be amenable to that?

[Commissioner Sampson (Department of Financial Regulation)]: What would the plan be?

[Alyssa Black (Chair)]: That the governor would get one pick and then the other pick would be a combination of the speaker and the pro tem.

[Commissioner Sampson (Department of Financial Regulation)]: There's the the timing issue. Right? Like, what happens if that's in July, August, you know, basically out of session?

[Jennifer Carbee (Office of Legislative Counsel)]: The government's in process. Yeah. They appoint.

[Commissioner Sampson (Department of Financial Regulation)]: Okay. Yeah. We would prefer a nomination process, as as I said earlier, or that you know, maybe it's setting up who shall be empowered to submit nominees to the governor, something like that, whether that be individuals, or individuals in certain titles.

[Alyssa Black (Chair)]: It be relatively easy to just set up a nominating committee of a representative from the Department of Financial Regulation, a representative from Agency Care and Services, a representative from the Green Massive Care Board, a member of the House and Senate?

[Jennifer Carbee (Office of Legislative Counsel)]: I think you need to then create criteria, potentially some amount of process. I just thought it's I mean, I think you Deanna, I'm not sure what you're gaining.

[Commissioner Sampson (Department of Financial Regulation)]: Yeah. I didn't Why why would why would you need to? Why would you need to create criteria and statute?

[Alyssa Black (Chair)]: I'm deferring to legislative power at times. Okay.

[Jennifer Carbee (Office of Legislative Counsel)]: I think if you're having five people get together and pick names, they need to have criteria by which they are picking names. If you're allowing an individual or elected officials to make their own choices, their own selections, then you're sort of delegating a broader decision making authority to a particular elected individual.

[Alyssa Black (Chair)]: Tucker and then Allen.

[Leslie Goldman (Member)]: We look at what consulates are guiding us. I'm not afraid. I think that that goes to the fact that we are talking about two people from the public. I don't think it makes any difference whether you have a committee that's going to submit the names or whether or not you're just going to let the government do it. I think we'll spend a lot of time, I don't even know why we're spending this time on this piece. Gives?

[Alyssa Black (Chair)]: Is there anything in this language that would limit the governor from appointing someone from someone within state government or within the administration? I mean, know it says member of the public, but we're technically all members of the public?

[Jennifer Carbee (Office of Legislative Counsel)]: No, it says no. Mean, the only criteria, there are really no criteria. Any member of the board of directors claims that the governor can be a member of the public, a subscriber or a provider.

[Alyssa Black (Chair)]: My concern is that the executive branch would be able to choose two people already within the executive branch. And I don't know if that

[Commissioner Sampson (Department of Financial Regulation)]: Yeah, I wouldn't want that either. I think I said in my original testimony that it would be inappropriate for a regulator from DFR, I think any regulator, who also serve on the board, you can't you can't evaluate and regulate what you're a part of. And to your point about the importance of governance of the board is if you're on the board, you are conflicted from regulating that same entity generally or certainly face the threat of a conflict of interest. That will apply then over to

[Alyssa Black (Chair)]: somebody in the administration. I'm sorry. Hillary, did you wanna I didn't

[Hilary (staff/counsel)]: I'm sorry. It's it was challenging to not interrupt, I apologize. I just wanted to reiterate what the Commissioner had said that likely the Executive Code of Ethics or the State Code of Ethics would provide limitations.

[Alyssa Black (Chair)]: Thank you for that clarification. Allen?

[Allen "Penny" Demar (Member)]: I just think we're going to stop complicating this. It's going to be in there as governor, leave it as the governor.

[Commissioner Sampson (Department of Financial Regulation)]: It's where we were five minutes ago.

[Alyssa Black (Chair)]: I know I think we're gonna table the discussion.

[Brian Cina (Member)]: Okay, the reason I think it's worth, the reason I think we're taking time on this, at least me, is that we're setting up the guidelines of a process that's going to affect the lives of everyone over time. And so sometimes it's worth taking the extra time to go in circles and land on a process that feels truly democratic. And to me, that's what's important here, is that it's a democratic that's a lowercase d for the record. You know, like it's a democratic process, meaning like that there's maximum transparency, maximum possibilities for people to be engaged, very open, clear to the public how it's happening, no nepotism or favoritism, etcetera. I think in terms of the balance of powers, I lean towards one from the executive branch and one from the legislative branch. I would say it's the official branch, but I feel that then interferes with their ability in their job. So, fine, we'll let it be just two branches. And A question I have is, and I like the idea of a nominating committee presenting the two appointing powers with a list of names, and then they can choose from those names based on overview of the same criteria that was used by the nominating committee. So what you're doing is saying to the public that here's the five criteria that was decided that is needed to be on this board. This committee of different parties came up with a list of X amount of names, and I think if there's two choices, we need to have at least four names, for example. They can't just give two names, because then there's no choice. So we would need to think about what's the minimum number of names on the list. Like, they can have a maximum, not to complicate it, but it's something to think about. And then when the speaker and pro tem or whoever it is, right, speaker and pro tem sit down to choose their name, they look at the criteria they look at the names. And they're like, all right, we see why they picked these people. Now who do we wanna pick based on these criteria? So that at every level, there's some consistency. I think that there's even though it might be annoying and nitpicky to do this, I think that the value of it is that in the end, we can trust that there's some fair democratic process. And I'm not super comfortable with just saying the government can pick whoever they want, and we're going to trust that ethics are going to guide it. Because then the public will eventually question that, regardless of who the governor is. It's not about the person to me, it's about the position and the role, and we're laying the foundation for the future regardless of who wins an election. So I don't that's my thoughts on it. I know you want to table it for now, but I wanted to put that out there because this is what comes to mind as I sit here and listen to

[Alyssa Black (Chair)]: every I do appreciate you pointing out that this is an important process. It may seem like it's a I think at this point, I would like to table it with either we keep the language as is from the original bill with the governor getting two, or we do one from the governor, one just picked by the speaker and the pro tem. And would anyone mind if I worked with EFR around

[Leslie Goldman (Member)]: opera, which I don't know?

[Brian Cina (Member)]: Around what?

[Alyssa Black (Chair)]: Figuring out whether or not it's either speaker pro tem, one governor, one speaker pro tem, or if it's two governors. I would like you to work with the AFR and Topher,

[Daisy Berbeco (Ranking Member)]: although you're outnumbered, so let me know if you need help.

[Commissioner Sampson (Department of Financial Regulation)]: May I ask a question of fledged counsel relevant to this? Sure. Is there not language in the senate around the same type of proposal for hospitals?

[Mary (DFR staff, Insurance/Policy)]: That bill has not been taken up.

[Commissioner Sampson (Department of Financial Regulation)]: Hasn't been taken up. Okay. So there is a bill, hasn't been taken up.

[Brian Cina (Member)]: Is it on the wall you need? Do you know the number?

[Alyssa Black (Chair)]: Can we? I suggest we

[Jennifer Carbee (Office of Legislative Counsel)]: take a listen. Move up.

[Commissioner Sampson (Department of Financial Regulation)]: Alright. Okay. Second piece of section one and two is is the comp. We added some language. It's in this version. That was really to be crystal clear. The motivation, which I went through my rigid testimony, is that we were unable to kinda recompute or see kind of behind the curtain on where some of these executive compensation benchmarks were. So this additional language just makes it very clear, the intent that we need data at the level that we can validate what the benchmarks are, how they were computed, and how they relate to the executive compensation being proposed.

[Mary (DFR staff, Insurance/Policy)]: Real

[Commissioner Sampson (Department of Financial Regulation)]: quick. Regarding, I think, former sections three through six, age rating, You'll recall that, you know, we brought this forward with the idea that if if we got the nod from the legislature, we would then hire actuaries, then look into the details if it made sense, and then then have the clarity in law or the support in law to publish a rule that would introduce some moderate age rating. It is clear to us as it is clear to you and I think to the health care advocate at this point that there are some counterintuitive things that could happen in terms of premium on the exchange. So it we do not object to that strike so that that what we're gonna do and we don't need a, you know, a mandated report or anything. We're we're gonna we're gonna do some research on that to model that out better and also look at, an idea that I heard, I believe, from perhaps the chair of, you know, can you achieve the same type of ends through modifications to the Vermont premiums premium assistance to calibrate that differently to be more sensitive to the level of subsidy that younger age groups are paying within the premium. So we we have no objection to that. Regarding association health plans and short term limited duration, I'll just skip that. There's no controversy there. That was that was

[Alyssa Black (Chair)]: We're not skipping humor. Thank you.

[Commissioner Sampson (Department of Financial Regulation)]: Yes. I I sorry. My attempt at humor, Mary got it. She works with me every day. So, yeah, we continue to to believe that at this point, at this cost structure that we have or or level of cost throughout both, you know, the QHP and ERISA plans, large group across the board, that to in both of these areas, AHP's and short term limited duration, effectively, we're doing, to some degree is telling small businesses, nonprofits, etcetera, no. You can't look at that. No. You can't have that because, you know, there's a there's a a a higher cause we're trying to, achieve here. And I get that. And if you know, we went over this in our initial testimony. There is a tension there, between and there is an impact long term on the, the pool. There's an impact now. We have ERISA. We have a federal law that preempts us from doing anything on certain things. I think there are many there's been a lot of, positive activity from this body, from the care board, from DFR, from AHS to improve the cost of care situation, the delivery of care, the health of Vermonters, the the average claims for Vermonters, utilization of care, all those things, we'll do what we all agree we need to do, which is address the cost of care across the board, for all payers. This provides some additional opportunities, for for, frankly, a limited set of, or additional options for a limited set of the population, that have asked for it. It's some of it is contingent upon changes at the federal level that may or may not come. Some of it just provides additional flexibility to follow large group standards that currently they they do not have that flexibility current AHP's. So to be more succinct about it, we have to address everything. One thing we wanna address while we're addressing the cost of care and long term issues is more options for those businesses and nonprofits. So we we we'd like to keep it in there. It is in there in this draft, so we're we're happy to see it still in there. But I know it's on people's mind. Lori?

[Lori Houghton (Member)]: Has there been any analysis done by anyone that these AHPs would even be cost effective for businesses in today's world?

[Commissioner Sampson (Department of Financial Regulation)]: Which AHPs?

[Mary (DFR staff, Insurance/Policy)]: Any offering of AHPs.

[Commissioner Sampson (Department of Financial Regulation)]: Well, we we know they're cost effective in the current regulatory framework because people are making use of them. Not sure if I'm understanding your selection.

[Lori Houghton (Member)]: I thought we didn't have a maybe I don't have the

[Commissioner Sampson (Department of Financial Regulation)]: Oh, we do. We have we have association. Do we we have an active one at this point? Just one, I believe. Sorry. I'm asking.

[Jennifer Carbee (Office of Legislative Counsel)]: Probably a couple.

[Alyssa Black (Chair)]: Yeah.

[Mary (DFR staff, Insurance/Policy)]: One.

[Commissioner Sampson (Department of Financial Regulation)]: That's right. Yep. So but I would almost see it similar to groups go employers going self insured. You know? It's it allows that self insured option or fully insured. You can be either one as an AHP, but it allows that. It just simply allows smaller employers that maybe don't have the stability in claims to consider going self insured to band together, again, if that federal change happens.

[Lori Houghton (Member)]: And that okay. So it is there is a requirement in the federal change?

[Commissioner Sampson (Department of Financial Regulation)]: Yes. We can't right now, there's there's a thing called the commonality rule, which means you you have to be and if you you have to associate for some reason other than just buying insurance. Yeah. And right now, that's the the federal standard. If that were to go away, and and that's somewhat yeah. Anyway, that's that's a whole legal discussion in terms of what it would take at the federal level. What this what our proposal does is say, if that were to change at the federal level, we can conform with those changes and allow smaller groups to band together as an association to purchase self insurance or to go self insured. I

[Lori Houghton (Member)]: just as much as I want

[Alyssa Black (Chair)]: to help businesses, this scares me for the effect on everyone else. And I have questions pertaining to frightening. So I remember a day when self insured was I mean, it was large companies. It was companies who were like multi state companies. And my own area, Foundries and IBM, self insured. It was the educators, it was the state employees. It was very large employers. You worked for American Airlines, you were self insured. But what has made it so that we are now seeing much smaller employees go self insured? Because it seems as though each and every year, more and more companies are going self insured, very small companies, local companies, not in a multi state, employees in multiple states. What has allowed that to happen? And also, have you seen with the proliferation of employers going self insured, have you seen an erosion of the QHP market? That's part one. Mary's over there laughing.

[Commissioner Sampson (Department of Financial Regulation)]: Part one a, you know, what what causes that? I don't I don't have data or but it doesn't sound you know, I would generally put my money on your assessment that more more groups have gone self insured, but I don't know that to be a fact, but I'm not countering it. Part of that would be as the fully insured market, as the options get more and more expensive Yeah. You you start to alienate more and more healthier employers. Not alienate whatever. I don't wanna use pejorative terms. But as we climbed up the ladder as the most expensive arguably exchange fully insured plans in the nation, you are making more and more small groups say, wait a minute. We have 20% better claims, per member per month than what we're paying in. Let's look at options. And, you know, that that is and to be fair, this would open that option to more people if the federal law changes. And so, yeah. I think that's that answers one question perhaps. That's that would be my theory, that as you become as affordability, as the cost of care goes so high and the morbidity of the risk pool gets worse, you do you do you're you're demanding more of a, forgive the term, subsidy of the healthier groups or healthier people in that pool to continue buying it. And we see the same thing with the the tax credits expiring. Now all of a sudden, when you're paying full boat and you're a healthy 20 year old at a certain income level, maybe where you're not getting a lot of subsidies or you're looting you lost them, just becomes a harder decision. So, you know, this does give rise to the age rating discussion and and to this as well.

[Alyssa Black (Chair)]: You also agree, however, that when a company goes self insured, they have a a far more numerous options for a third party administrator, which may not have reimbursement contract amounts that are as high as the commercial? And would you say that there's a cost shift and that every company that leaves the exchange is now putting pressure on the regulated market and the Green Mountain Care Board to increase their reimbursements to make up for lost revenue elsewhere. If you're at That maybe it has actually increased our cost of care.

[Commissioner Sampson (Department of Financial Regulation)]: I think are you asking if some of these TPAs or insurers that are providing claims support for self insured get better reimbursements out of the hospitals?

[Alyssa Black (Chair)]: I'm I'm suggesting has anyone looked at that? I'm asking. Has has anyone looked at

[Commissioner Sampson (Department of Financial Regulation)]: I have not, but I doubt it. I doubt that UVM is, or any of the hospitals, are undercutting Vermont, you know, that that the insured the major insurers that provide fully fully insured plans, MVP, Cigna, to a limited extent, and Blue Cross. I don't think but I do not know that for a fact.

[Alyssa Black (Chair)]: Maybe we'll ask the hospitals whether or not there is we'll ask the hospitals if there is a difference.

[Commissioner Sampson (Department of Financial Regulation)]: I would actually if I had to guess, I'd guess the opposite. The issue is around benefit design, freedom for on a risk of benefit design, and then just having a healthier pool. Those two things drive you into self insured. Way more flexibility on on benefit design than than being on the exchange. And then if but that alone maybe doesn't do it. And then the second piece being my folks are 20% healthier.

[Alyssa Black (Chair)]: It would be nice if we had some data on the contract amounts with providers and if there's a disparity between the average contracted amount, because I would argue that that actually also goes into why it's advantageous to go self insured and why costs are less is because reimbursements are not necessarily on par. And that's a cost shift. It's a cost shift to the QHP market.

[Commissioner Sampson (Department of Financial Regulation)]: I think absent having those contracts of outside of those, not having those or absent getting those contracted amounts and doing a price comparison or reimbursement comparison, there probably is some information we can bring back in shorter order around what percentage of the the non QHP and large group, the non fully insured market is with is not with our big three, MBP, Cigna, and Blue Cross and and whether you know?

[Alyssa Black (Chair)]: Shouldn't we have complete data before we

[Commissioner Sampson (Department of Financial Regulation)]: Well, the data I have is that we have been on this regulatory and legislative philosophy for twenty or thirty years and look at where we are. We have said we're gonna go all in on, you know, minimizing the impact of ERISA, of AHPs, and all that with very restrictive policies. And has it made the QHP risk pool best in class? No. You know? It's like, you know, I don't there's certainly a driver here that what we've done in the past is just not working, and let's be open to shifting things.

[Alyssa Black (Chair)]: Well, this isn't my question. This is a larger question. Aren't we interested in what we can do to make the QHP market the place to be? I mean, shouldn't we be concentrating on that?

[Commissioner Sampson (Department of Financial Regulation)]: I think we should be concentrating on the cost of care, which helps everyone.

[Alyssa Black (Chair)]: Which which we're trying our

[Commissioner Sampson (Department of Financial Regulation)]: Making the QHP the place to be will never get around the federal preemption of ERISA. Mhmm. That is a huge, huge issue.

[Alyssa Black (Chair)]: I see, Brian. One more question. You said that you felt that this was a limited set.

[Commissioner Sampson (Department of Financial Regulation)]: Yes, because of yeah.

[Alyssa Black (Chair)]: Do you have any estimates on how limited I mean, I know I think in your last testimony, you were talking about I think we talked about dealers, automotive dealers possibly, but then you also mentioned nonprofits. If nonprofits were pooling together, that's a huge, that's not a limited set.

[Commissioner Sampson (Department of Financial Regulation)]: Do

[Alyssa Black (Chair)]: you have any estimates on how many associations would form and just the the volume of people.

[Commissioner Sampson (Department of Financial Regulation)]: Probably a good question for the for for the I do not. So between BVSR, the chamber, and what was it, common ground or the Common good. Common. Yeah. They they may share the interest that their constituents have. Again, that that piece does not change with this proposal until and if, big if, the federal government changes their stance. And, you know, one piece of research that Joe did on our team is look at whether that was even on the CMS agenda or on the rules agenda, and it was not, which doesn't mean it they don't bring it up. But at this point, it's not on the horizon as a predictable thing that they'll do, leaving just this proposal to align benefit design for AHPs qualified currently to the large group standard.

[Alyssa Black (Chair)]: Okay. Ronnie?

[Brian Cina (Member)]: Yeah. I don't know if we really wanna discuss this, but when you said that when you started talking about the the QHPs and ERISA, I guess my question is, if our QHPs were really good deals, might companies choose them over their multistate plans? That wouldn't be us interfering with ERISA. It would be us using the marketplace, the commodification of healthcare services, out competing them using standard capitalist practices or whatever it's called. Maybe that's the wrong word, standard corporate, I don't know what it is. Free market, free market competition. Yeah, I mean, it is capitalism, so I'm just naming it.

[Commissioner Sampson (Department of Financial Regulation)]: Yeah. I mean, if if the the quality and size of the fully insured market or the QHP market absolutely has potential to start to bring people off of ERISA or you know? Yeah.

[Brian Cina (Member)]: Yeah. Would would and this will be my last question on this, because I don't I don't mean to perseverate on this issue. But I do think it's important, like, we're deliberating on this bill, because it's getting close to the finish line. So thank you for tolerating it. In terms of increasing competition, it sounds like we're going to take some action here around the AHP's. Might there be a benefit? Maybe it's not in this bill, maybe it's too late, but might there be a benefit if we're trying to give people more choices? I think that's the intent, right? We're trying to give people more options of a public option on the QHP.

[Alyssa Black (Chair)]: I don't know.

[Brian Cina (Member)]: Yeah, that kind of thing, or allowing people to buy into Medicaid so that the Medicaid risk pool is broadened and that we have healthier people buying into Medicaid, which might help. That something that is, would that be giving, would that help? Would that be another thing to throw in the mix?

[Joe (DFR Director of Policy)]: Is that outside of the That's not a proposal I

[Commissioner Sampson (Department of Financial Regulation)]: have or prepared to talk to. That's a huge question, huge question.

[Brian Cina (Member)]: Would that be something that would be within your jurisdiction or not? To offer a public Yeah. We were, like, considering that. Is that something DFR would weigh in on, or is that outside is that, like, more of a

[Commissioner Sampson (Department of Financial Regulation)]: Oh, we'd weigh in on it. Okay.

[Alyssa Black (Chair)]: I'd have

[Commissioner Sampson (Department of Financial Regulation)]: to see the plan. Okay. Understand it. And then jurisdictionally, imagine it'd be split between, you know, EVA.

[Alyssa Black (Chair)]: Yes. Of course. Very much.

[Mary (DFR staff, Insurance/Policy)]: I think we wandered a bit. Remember, like, what we're talking about here in small market. Mhmm. These are employers less than 100 people. Anything over that, we have no way that competition is ridiculous. They're not eligible for what we're talking

[Alyssa Black (Chair)]: about here.

[Mary (DFR staff, Insurance/Policy)]: So those big employers, that competition, they're off to.

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

[Karen Lueders (Member)]: I do. And it has to do with, you're using the term benefit design.

[Commissioner Sampson (Department of Financial Regulation)]: Yeah.

[Karen Lueders (Member)]: And where, let's just, though we're wandering, maybe, we're in Urisa land and does the utilization enabled by the benefit design in those plans directly impact the cost of care, which is one of the things we're trying to address. And then isn't it true that premiums, even though it's federal planning, we didn't want to pay for those increased premiums every year because of utilization and cost of care, and I don't, I'm just trying to understand that piece.

[Commissioner Sampson (Department of Financial Regulation)]: Yeah, I'm not sure I understand the question.

[Alyssa Black (Chair)]: So

[Karen Lueders (Member)]: there are large groups under your visa plans, and the benefit design is such that it's easy, there's no barrier to accessing any kind of, well, I don't know, any kind of, but healthcare you want, doesn't that utilization increase?

[Commissioner Sampson (Department of Financial Regulation)]: When I referenced benefit design as something that's attractive to folks going self insured, It it's more around the fact that you're not tied to the prescribed benefit design of the QHP, just, you know, central health benefits, etcetera. You can you you have some freedom to coverage. So the idea there for an employer who makes use of that is to be able to leverage other avenues of of savings or, you know, saying, hey. We're not gonna cover a b c. The exchange makes us cover a b c. Employee employees, we're not we're not covering that. You know, there still are rules, but there are a looser set of rules. I think Mary or someone else would have to come up to get into the details of that. But so I think the goal there is perhaps the opposite of it, which is to reduce utilization or at least utilization that that becomes the responsibility of the employer And those becomes part of the premium that that the employer employee pay.

[Karen Lueders (Member)]: And those would be for the small group or any self insured?

[Commissioner Sampson (Department of Financial Regulation)]: For any self insured, yes.

[Karen Lueders (Member)]: No matter what size. Correct.

[Alyssa Black (Chair)]: Alright. Let me get back to basics. What are you waiting for from CMS? Like, what?

[Commissioner Sampson (Department of Financial Regulation)]: You know, a different take on so, originally, there was a a regulation that's removed the commonality. Commonality says you cannot come together as an AHP simply to purchase insurance as a group. You have to have something that unites you. So we're all together because we are all whatever, aficionados of hot air balloons. And together, we're gonna buy health insurance as well. But that's okay under current federal law, very loosely. But there was an attempt in the first Trump administration. There was a draft rule or a rule that basically said, scrap that. That was interrupted, I believe, by the courts saying, not that way. You can't do it. So there was a moment in time where there was potential for us that aren't all aficionados with hot air balloons to say, hey. You guys wanna buy health insurance together? If we can get a better deal. That help? So so that's that's so so that's what we're waiting for

[Alyssa Black (Chair)]: To hear.

[Commissioner Sampson (Department of Financial Regulation)]: For the for the federal government to you know, if they do that in a way that passes the court's muster, will Vermont adopt that and say, yes. This group can come together and buy health insurance?

[Alyssa Black (Chair)]: And as a follow-up Yeah. Those people that do do that, they they they're not obliged to do any kind of middle minimum essential coverage. There's no rules.

[Commissioner Sampson (Department of Financial Regulation)]: There are some rules I'd need to ask Mary to weigh in on It's

[Jennifer Carbee (Office of Legislative Counsel)]: little complicated, of course, because this is not New Jersey.

[Mary (DFR staff, Insurance/Policy)]: Yes, there are rules for benefits when you buy an exchange plan that has a various percentage of mandates that are dictated by both the federal government and the state of Vermont.

[Joe (DFR Director of Policy)]: To make one clarifying point, Joe, Director of Policy and the FR for the record, it is not CMS that puts forward this ruling was the federal labor.

[Commissioner Sampson (Department of Financial Regulation)]: Was a

[Joe (DFR Director of Policy)]: 2018 rule on commonality that was challenged in the courts, and it is the DOL rule that if they would choose to re propose in another form, that they could move forward. We look at the unified agenda from OIRA, which is part of the executive office of the president. It's a list that comes from every federal agency twice a year they lay out their rulemaking plans. The most recent one, which was from September, and that often there are lags. So DOL probably last filed a few months before that potentially did not have any plans for a rulemaking on this topic. Now, that's not binding. And obviously, if that's six months ago or more, they may have new plans to do that and you just not have shared those on the record.

[Alyssa Black (Chair)]: Okay. So what you're not seeing on CMS could be

[Joe (DFR Director of Policy)]: on the Department of Labor. I was wrong by saying CMS.

[Commissioner Sampson (Department of Financial Regulation)]: It's DOL because it's ERISA, which makes sense.

[Alyssa Black (Chair)]: That was actually my question. I'm going ask it to Joe. Has there been anything in the last year and a half that has come out that you've seen, would you say that the federal government is being incredibly predictive right now? That was my question. She would know the best.

[Joe (DFR Director of Policy)]: As a former federal employee, I'm not opinion.

[Alyssa Black (Chair)]: That was all. And Lori, go ahead.

[Lori Houghton (Member)]: So my question is, hearing all of this, let's assume

[Daisy Berbeco (Ranking Member)]: let's not assume

[Alyssa Black (Chair)]: this.

[Lori Houghton (Member)]: I guess my question is, AHP has become a thing we can do. What is the timeline of actually putting an AHP into play? Do we have to make this decision now depending on the timeline?

[Commissioner Sampson (Department of Financial Regulation)]: The the timeline, if if this were to pass and DOL were to amend their rule, we would have to amend our rule, our regulation.

[Jennifer Carbee (Office of Legislative Counsel)]: That through rulemaking? Yep. Yeah.

[Commissioner Sampson (Department of Financial Regulation)]: So, you know, I would say the soonest between federal change, our rule change, assuming this law changed, the soonest you could see these entities trying to find a way to band together and buy and explore buying health insurance, and then they have to go through the data gathering and figure out whether it even makes sense, I think the soonest would be if they're gonna stick to January 1 plan years, I would guess 01/01/2028 plan year would be and that that that, again, presumes Like everything the federal yeah. Everything kind of lining up.

[Daisy Berbeco (Ranking Member)]: Definitely. Thank you.

[Alyssa Black (Chair)]: And is it clarifying or I'd like to move on to the next sections, we're running. No, me, she's looking at me. Oh, Yeah, I was looking at Leslie. This could be quick because I'm feeling like I don't understand, I'm sorry, why this has to happen now. What are we gaining by putting this section in right now? Because the only thing I'm seeing is two lines, fully insured association. You said something about that, but I didn't get why this is so important.

[Commissioner Sampson (Department of Financial Regulation)]: Yeah. And it's similar to the timing question is that absent doing this now, if those things happen

[Alyssa Black (Chair)]: But I'm starting to own weary of the Ips, because why bother? Because ifs could be five, ten years away. We don't know.

[Commissioner Sampson (Department of Financial Regulation)]: Right. But if but if they're not

[Alyssa Black (Chair)]: Well, couldn't we come back and fix it right away if it went through? The commonality bug went away?

[Commissioner Sampson (Department of Financial Regulation)]: If if in July, we get commonality get get the the change that we're talking about here, then we have to wait a whole year to come back here, change the law, then start the rulemaking process. So then we get into 2029. So, you know, my kind of broad brush stroke look at this is we have businesses, nonprofits, etcetera, suffering. We need to do everything we can in terms of cost, everything we can as soon as we can to to give them options if those doors open up. Yeah.

[Alyssa Black (Chair)]: May or may not.

[Commissioner Sampson (Department of Financial Regulation)]: Which may or may not. True. But there is a second piece to this, which, again, is that alignment of following the large group rules, even for exempting

[Alyssa Black (Chair)]: Is that what the full insured thing does? That language right there? NC?

[Commissioner Sampson (Department of Financial Regulation)]: Looking at Mary.

[Mary (DFR staff, Insurance/Policy)]: Yeah. We would change the statute, and then that will allow us to go in and also change the regulation. The benefit society is through the regulation. So, change the statute, we go to rulemaking, change the regulation so that for existing AHP's and those that qualify under the existing law, they would then have that thought through alignment as soon as we got through the rulemaking process.

[Alyssa Black (Chair)]: So there's no reason not to do this because either it's gonna sit there inert or it's going to give you the authority to act, one or the other. All right, let's hold on really quickly. Short term limited duration. Make a case why we still need this.

[Commissioner Sampson (Department of Financial Regulation)]: We have, what, seven plus percent are not insured right now based on the loss of premium tax credits. They arguably have nothing. Traditionally, we have looked at these plans as not as as potentially being problematic, being sold as a replacement for comprehensive major medical. It's the same type of situation we're in with AHP, which is the cost situation is so severe that I think we have to allow options. I don't feel comfortable as a regulator anymore saying, you can't even look at that. You can't have it. You know? That's and I'd say to follow-up on that, they still would need to go through rate review, policy form review, etcetera, into department. We we have no interest in allowing plans that would siphon away folks from the QHP, etcetera. This this the short term limited duration may provide some coverage to people who otherwise would have none. I

[Alyssa Black (Chair)]: tell me why the language that's in here precludes someone from doing twelve months of a short term limited duration health policy, that policy ends and they start a whole new twelve month period. And I'm really, really concerned about this with federal changes that are coming around the enrollment of QHP plans in the individual market. They have to actually re up every single year.

[Jennifer Carbee (Office of Legislative Counsel)]: I've been summoned.

[Alyssa Black (Chair)]: He's like, yeah, I'm just letting Warren.

[Commissioner Sampson (Department of Financial Regulation)]: One response would be that, again, if we can approve, you know, both from a policy and rate point of view, something that is is distinct from well, that serves a population that otherwise isn't gonna buy insurance for the reasons we've all talked about or I have, then if they wanna renew it, fine. But I thought

[Mary (DFR staff, Insurance/Policy)]: So this is another one that there is a statute and there is regulation that goes with it. So the statute, we can put requirements in the statute and in the regulation that would require insurers to not allow them to do that. So when the federal law was changed 2018, was that again the last Trump administration, they allowed it to roll out to thirty six months. We have no intention of doing that. We will only allow it to roll out to twelve months. Right now we can't even do that because there's a federal, this is another federal law. It only goes as far as four months right now. This would open this up so that it would sink to federal law. If the federal law expanded, we would have a regulation that said you can only go twelve months, and that's as far as you would go, and insurers would be required to enforce that. And if they didn't, then our enforcement mechanisms should take that over.

[Alyssa Black (Chair)]: Daisy, really quickly, and then we're going

[Daisy Berbeco (Ranking Member)]: to move on to the next sections.

[Alyssa Black (Chair)]: How recent is this 7% uninsured figure? Where is that from?

[Commissioner Sampson (Department of Financial Regulation)]: It's from the not 7% statewide. I think 7% of the QHP dropped coverage The date was an estimate I heard verbally, so I don't know. It says

[Mary (DFR staff, Insurance/Policy)]: Now, we're still waiting on the February drop,

[Commissioner Sampson (Department of Financial Regulation)]: I'll follow-up with a better number. And maybe Blue Cross has one.

[Alyssa Black (Chair)]: It's a moving target.

[Commissioner Sampson (Department of Financial Regulation)]: And it may be from a specific insurer or it may be the mark on that. Don't recall. Or it may be related to the estimate.

[Jennifer Carbee (Office of Legislative Counsel)]: Okay.

[Commissioner Sampson (Department of Financial Regulation)]: Yeah.

[Alyssa Black (Chair)]: Fair. Right. Moving on.

[Commissioner Sampson (Department of Financial Regulation)]: Next is high dollar claims, section six. Yep. You know, that's staying in there. Again, you know, highlighting that this doesn't compel an insurer to to with patents that it's on that. It just sets a number in there. I don't yeah. So we prefer it to stay in there, and it is in there. Next is prior authorization. That has struck out. We understand the desire to wait on that. You have reporting requirements, I think, you're getting next year. So, I think longer term, we wanna make sure that we're we're balancing cost, administrative costs, and and yeah. With the ability we wanna make sure insurers still have the ability to do their part to control utilization appropriately, but we're we're fine with that strikeout.

[Alyssa Black (Chair)]: I'd like to go on record with something about that. When we did this bill, we were constantly told it'll increase utilization, and yet because we weren't doing it, no one actually knew. And I made a vow and I promised that if after two years they come back and utilization has increased, if I am lucky enough to be sitting in this seat a year from now, I will be the first person to strike that. So I just want to go on record as saying no, but let's wait and see how it comes out.

[Commissioner Sampson (Department of Financial Regulation)]: Okay. We're we're comfortable with that. Let's see. Thirteen thirty two now in the budget, I believe. Thirteen thirty two waiver. That that's that's fine. I think, everyone agrees that having the ability to make an application if it makes sense, So authorizing that. I don't care what bill it's in. Let's see. Then then we're left with the two, additions, maximum pharmacy out of pocket. Getting rid of that, that does not stern us. We don't object to that. I think it makes some sense. I think we'd agree with what some have have said that, you know, why are we creating a special class of folks that have an out of pocket max because they're high pharmaceutical? We have a lot of people that are high overall medical. And I think it does have an interesting impact on benefit design and limits benefit design when you're looking at meeting actuarial values and also the ability to have a bronze plan that is limited to I don't know. I think it creates interesting behavior in terms of folks that know they have a high pharmaceutical need can go for a plan. Yeah. I'll just be I I support. It's very complex. I support it. And, you know, with the understanding that insurers can still offer one if it makes sense. This doesn't make this doesn't preclude them from offering a lower out of pocket max on pharmacy, and that for consumers that want an overall low out of pocket max overall, those are available. They're currently available. Health care sharing, no objection there. It does not, as we can see, create an undue burden on us in terms of having to staff up a reporting function, etcetera. So have a question to that.

[Alyssa Black (Chair)]: Oh, site neutral.

[Commissioner Sampson (Department of Financial Regulation)]: Oh, neutral.

[Alyssa Black (Chair)]: I if that's I forgot that little thing.

[Mary (DFR staff, Insurance/Policy)]: That's not each Site

[Commissioner Sampson (Department of Financial Regulation)]: neutral, I think we're okay with that evolving into a narrow thing we all heard because I was in the room, interesting testimony from primary care and physical therapy on what the market looks like, the competitive market looks like for them specific to physical therapy. I think there you know, we are aware of of, data. We've seen data. There is a big difference, and haven't seen a lot of logic for that difference. And I think being site neutral on that is a good entree into site neutral. It would impact all payers or all you know, it would be across the board, not just, you know, there are proposals currently being discussed in the senate that would focus things just on QHP. I think this is preserve something that could that could focus well, not focus, but be applicable to all segments of of the market and as well as supporting independent practitioners and and seeking care outside of a hospital setting. So and it also preserves the concept of site neutral for discussion in the senate.

[Alyssa Black (Chair)]: Yep. Any questions remaining? I think we covered everything.

[Commissioner Sampson (Department of Financial Regulation)]: I don't know if the temperature went up or you guys didn't. Was a really good question.

[Alyssa Black (Chair)]: All the effective dates.

[Commissioner Sampson (Department of Financial Regulation)]: We're okay with all the effective dates, I think so.

[Alyssa Black (Chair)]: Yeah, that was the only last thing. All right,

[Jennifer Carbee (Office of Legislative Counsel)]: well thank you.

[Alyssa Black (Chair)]: All right. So can we actually take just a five minute