Category Archives: State Government

Exchange work to continue, despite SCOTUS ruling

MONTPELIER — A U.S. Supreme Court ruling handed down Thursday ensures that some Vermonters will continue to be eligible for federal subsidies through Obamacare if the state opts to abandon Vermont Health Connect later this year.

The court upheld a major challenge to the Affordable Care Act in a 6-3 ruling Thursday, ensuring that nearly 9 million people receiving federal subsidies under the law can continue to receive them regardless of where they live. The challenge to the law contended that the subsidies were only available to states that created their own exchanges, like Vermont.

VHCThe challenge could have had major consequences in Vermont had the court ruled the other way. The state’s exchange, Vermont Health Connect, continues to face technology challenges. Some major functions that were supposed to be part of the state’s online health insurance marketplace continue to struggle.

Democratic Gov. Peter Shumlin has said the state would look to transition to the federal exchange if those functions were not working properly this fall. Vermonters will continue to receive federal subsidies in that event because of the court’s ruling Thursday.

Shumlin issued a statement Thursday after the ruling was announced saying the administration is continuing to work on Vermont Health Connect to ensure it works properly for Vermonters.

“We are making progress to deliver the services Vermonters expect through Vermont Health Connect. We have insured nearly 20,000 Vermonters who previously did not have insurance, and now Vermont has the second lowest rate of uninsured in the nation,” he said.

The state completed an upgrade to the website earlier this month to incorporate the so-called change-of-circumstance function. When fully implemented, it will allow customers to make life change to their accounts online, including marriage, death, birth of a child or a change in jobs. Another function, automated policy renewals, should be up and running this fall.

Republican Lt. Gov. Phil Scott, who has said he is considering a run for governor, used the ruling Thursday to call for Vermont to abandon its own exchange. Scott has been a critic of Vermont Health Connect’s challenges.

Lt. Gov. Phil Scott

Lt. Gov. Phil Scott

“For 18 months, officials have dismissed repeated calls to explore alternatives to our dysfunctional exchange, saying to do so would put Vermonters at risk of losing their subsidies. Now, with today’s U.S. Supreme Court ruling that federal subsidies can be offered in both state and federal health care exchanges, that fear is eliminated, and it’s clear we must immediately explore alternatives to Vermont Health Connect,” Scott said.

Scott called for immediately looking into a regional partnership with nearby states, creating a state-federal hybrid system or simply shifting to the federal exchange.

“For far too long, Vermonters have been underserved and frustrated by this $200 million system. Now that the fear of losing subsidies is no longer a valid argument, we must find the best path to affordable, accessible health insurance for every Vermonter,” he said.

But Lawrence Miller, Shumlin’s chief of health care reform, said Thursday’s ruling does not change the administration’s thinking and officials will continue to work on VHC.

“I think we’ve been clear that going to the federal exchange would still have substantial costs and complications for Vermonters. We would still need to figure out a way to deliver Vermont premium assistance because that’s not a part of the federal exchange,” Miller said.

Vermont is just one of two states that offer state-level financial assistance for customers on the exchange.

Miller said the state would still need to improve VHC even if the state moved to the federal exchange because it administers the state’s Medicaid program, including eligibility and enrollment. And, Miler said, insurance carriers in Vermont would have to devise a new integration model with the federal system.

Lawrence Miller

Lawrence Miller

“It would add substantial cost and complication. That is why we will still remain focused on the work at Vermont Health Connect and getting the level of service to what Vermonters expect,” he said.

Miller said he is glad the uncertainty brought about by the challenge has been settled.

“I’m very pleased with the decision. I think it’s the right decision,” Miller said. “The surprise really was when they took it, in my mind, and that raised a significant amount of uncertainty. If two more justices had seen it the way [Justice Antonin] Scalia (who wrote the dissenting opinion) did a lot of Americans would be having a very bad day.”

neal.goswami@timesargus.com

T.J. Donovan to run for AG

MONTPELIER — Chittenden County State’s Attorney T.J. Donovan says he will run for attorney general regardless of whether longtime incumbent Bill Sorrell decides to seek re-election.

Donovan, 41, came close to knocking off Sorrell in a 2012 Democratic primary for the state’s top law enforcement position. Donovan lost to Sorrell, who was appointed to the position in 1997 by former Gov. Howard Dean and has won re-election each cycle since, by just 714 votes.

Donovan opted to sit out the 2014 race and instead concentrated on his work in Chittenden County. That work has garnered plenty of attention statewide and has served, in some cases, as pilot projects for the state.

Donovan was honored Friday evening at the Vermont Democratic Party’s annual awards dinner. He did not reveal his plans at the time, however. Instead, Donovan said Monday that he “finalized in my mind over the course of the weekend” that he would run for attorney general again.

Chittenden County State's Attorney T.J. Donovan. (Photo courtesy of VPR)

Chittenden County State’s Attorney T.J. Donovan. (Photo courtesy of VPR)

“It just makes sense for me to put it out there and end the speculation,” he said. “I received a lot of support on Friday night. I see no reason to be coy. I figured I would put it out there that I’m running.”

Seven Days was first to report Donovan’s decision to run.

Speculation had been running wild for Donovan, and other potential candidates for various statewide offices, since Democratic Gov. Peter Shumlin announced earlier this month that he would not seek a fourth term in 2016. Many political observers wondered if Donovan would opt to run for governor. Continue reading

Welch says he won’t take long to decide on gov bid

MONTPELIER — U.S. Rep. Peter Welch says he plans to make a decision soon on whether he will give up his seat in Congress to run for governor.

Welch, now in his fifth term as Vermont’s sole congressman, emerged as a potential candidate following Gov. Peter Shumlin’s surprise announcement Monday that he will not seek a fourth term in 2016. Welch, a former state senator, ran unsuccessfully for governor in 1990.

Welch, 68, said in an interview Thursday he continues to enjoy serving in Congress. Despite the Democrats’ minority status, Welch said he has recently managed to push legislation into law, including energy efficiency requirements and funding for the National Institute of Health.

Rep. Peter Welch

Rep. Peter Welch

“I have a great job and I love doing this job. I find myself part of a group down here that’s trying to make this institution work and I’ve been able to establish good relationships with my Republican colleagues that benefit Vermont,” he said. “I could be very happy continuing to serve Vermonters right here.”

But, “circumstances change,” Welch said. With Shumlin vowing to bow out of politics, a return to Vermont and another bid for governor could be in the best interests of Vermonters and himself, according to Welch.

“It causes me and others to stop and pause and ask the question of what is best for Vermont,” he said. “You deal with the circumstances that exist and the big opportunity in public service is that you get to serve, it’s not that you dictate the terms of how you get to serve.”

Serving as a member of Congress is “a totally different job and totally different situation” than serving as governor, Welch said. But the challenges in Washington, D.C., and Montpelier are similar — “trying to build an economy that works for middle-income families,” he said.

“It’s really hard on middle-income families to make ends meet,” Welch said. “My focus, in all of my political career … has been a focus on trying to make sure the middle income families have a shot. The jobs are different but the objective and the orientation I’ve had has been the same, and that’s been true from the state Senate to Congress.”

A return to living full-time in Vermont could perhaps sway the Windsor County resident to leave Washington and launch a bid for governor.

“Of course I would like to be back in Vermont. Every week when I get home I get off the plane and it’s just relief. My emotional life is in Vermont. I work in Washington, I love my work, but my heart is in Vermont,” he said.

Welch said he has been “fully absorbed” in his current job and had not thought about a gubernatorial bid until Shumlin’s Monday announcement.

“When you step back, you realize that this decision by Gov. Shumlin was stunning and surprising,” he said. “It sets off an anxiety among politicians about who will run for what.”

Most pundits believe that the plethora of Democrats considering a bid, including House Speaker Shap Smith and former state senator and unsuccessful candidate for governor, Matt Dunne, will await Welch’s decision before making theirs. Should Welch decide to run for governor there could be a shift in focus that leads to a mad dash for the congressional seat.

Welch said his decision will come “sooner rather than later.”

“It’s really a personal process of giving consideration to where I can best serve,” he said. “Obviously, talking to my family is a big part of the process.”

Welch said he expects other candidates to determine their own futures regardless of what he does. “We’ve got a lot of good Democrats. We’ll have no shortage of democrats for any office that is open,” he said.

neal.goswami@timesargus.com

Capitol Beat with the Governor 6-09-15

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Vermont Gov. Peter Shumlin speaks to Vermont Press Bureau chief Neal Goswami about his decision, announced Monday, to not seek re-election in 2016.

Gov. Peter Shumlin discusses his decision to not seek re-election in 2016 on the Capitol Beat podcast.

Gov. Peter Shumlin discusses his decision to not seek re-election in 2016 on the Capitol Beat podcast.

Potential candidates for governor abound

MONTPELIER — Gov. Peter Shumlin’s surprise announcement Monday that he will not seek re-election throws the 2016 gubernatorial election wide open — and several candidates on both sides of the aisle say they are interested.

A potential surprise candidate emerged Monday when former Shumlin Chief of Staff Bill Lofy told the National Journal that Democratic Congressman Peter Welch “would be the prohibitive favorite” if he were to jump into the race. Welch has served as Vermont’s lone representative in the House since 2006, and has handily won re-election every two years.

Rep. Peter Welch

Rep. Peter Welch

Welch Chief of Staff Bob Rogan said Monday that Welch will consider his options and has not ruled out a run for governor.

“It’s likely Congressman Welch will seek re-election to Congress but this news comes as a surprise so he will be taking the time he needs to thoughtfully consider how he can best serve Vermonters,” Rogan said.

Democratic House Speaker Shap Smith made clear after the legislative session ended last month that he wants to be governor. But Smith said at the time that he did not want to run in a primary against Shumlin.

“I was pretty clear that I was not running … a primary against the governor. I was also pretty clear that I was interested in running for statewide office. So, it does change the dynamic,” Smith told reporters Monday.

Smith said he and Shumlin have worked together for years “for years trying to make sure that the state of Vermont could be an even better place than it is now and I think that we all owe a debt to Peter for his great work as governor.” He credited Shumlin for his response to the devastating impact Tropical Storm Irene had on Vermont.

Smith said he will consult with many people before deciding if he will launch a campaign for governor.

House Speaker Shap Smith

House Speaker Shap Smith

“I need to spend some time talking with my family first and foremost. This would be a really major decision for our family life. I acknowledge that and I want to make sure that they’re on board with it. I also want to talk to friends and Vermonters to see whether they think it’s a good idea for me to run for governor,” Smith said.

As someone who has never appeared on a statewide ballot, Smith could face a challenge with name recognition.

“I think that we all think that we’re better known than we are. I do find myself on occasion in other parts of Vermont where people say, ‘You’re that speaker guy, right?’” he said. “I don’t think any of us should overestimate how many people know us.”

Meanwhile, former state senator and current Google executive Matt Dunne, has made clear that he’s also itching to return to the Vermont political scene as governor. Dunne, who was part of the five-way Democratic primary in 2010 that Shumlin eventually won, said he plans to consult with his wife, Sarah, as well as his past supporters, before making a decision.

“As I shared with people during the campaign five years ago and more recently, there’s no better job in the world than to represent the people of the state of Vermont and to be able to have a role in helping to move the state forward,” he said. “I will absolutely be considering a run for governor. I’ve been flattered by the large number of phone calls and text messages and Facebook messages and emails I’ve received this afternoon and will take time to talk things over with Sarah and a number of people across the state of Vermont before making a decision.”

Dunne, who is the head of community affairs for Google, said he is not setting any time frame for announcing his decision.

Matt Dunne

Matt Dunne

“I’m not going to set a hard date. It’s going to depend on making the time to have that conversation with Sarah and my kids, who are old enough to be aware of what a campaign means this time, as well as touch base with folks who have supported me in the past and others who have just reach out to me today,” he said.

Doug Racine, a former lieutenant governor and candidate in the 2010 Democratic primary, could also consider a bid. He was fired as secretary of the Agency of Human Services last year by Shumlin.

A number of Republicans have been considering a run — even against Shumlin if he were to run again. But Monday’s announcement by the governor may make the prospect of running even more appealing.

At the head of the pack is Lt. Gov. Phil Scott, a Republican and a member of Shumlin’s cabinet, who said last week he is considering a run for governor. Scott, known for being an affable politician but one who has not yet had to take strong policy stands as lieutenant governor, said he intends to decide his political future over the next several weeks. Monday’s announcement, he said, will not impact that decision.

Lt. Gov. Phil Scott

Lt. Gov. Phil Scott

“Certainly it was a bit of a surprise, coming today, but as I’ve said consistently, whether the governor decided to run or not run will have no bearing on my decision making,” Scott said. “I’ll contemplate this over the next few weeks.”

Scott said he wants to be governor if the situation is right.

“Sure. I think that given the right circumstances, if I think that I’m the right person to lead Vermont and can help in some way, and my family and business will survive this, then I want to be governor,” he said. “It has to be more than about you. It has to be about others and the whole of Vermont.”

The lieutenant governor was not at Monday’s announcement and said Shumlin did not tell him before making the public announcement.

“I understand. Politics is what it is. I’m not surprised. This obviously had to be a tough decision to make and he wanted to share it with those closest to him,” Scott said.

Former State Auditor and Sen. Randy Brock, who was soundly beaten by Shumlin in 2012, says he may also seek the governorship.

Randy Brock

Randy Brock

“I’m certainly considering running again and been talking with people over the past several weeks and have some more to do. It’s something I’m considering but no decision has been made. It’s a decision that will be made over the summer,” he said.

Brock said any potential candidate “needs to declare relatively early because there’s a lot of work to be done, not the least of which is significant fundraising challenges.” Shumlin’s announcement, Brock said, will not sway him in either direction.

“It was always a possibility, and probably a real one after the 2014 election, that Gov. Shumlin would not run again,” he said.

Scott Milne, meanwhile, who lost a razor-thin election to Shumlin in November, said he has not yet determined if he will again seek the office. He said be believes “t’s a good move by Peter to step aside.”

“I believe Vermonters are more aware now than at any time this decade just how bad things are, and how much needs to change in order to save Vermont,” he said. “Whether as a candidate, or as a citizen helping good people get elected in 2016, I am looking forward to the campaign trail again.”

Now that the race for governor features no incumbent, more candidates could explore the idea of entering the race.

Shumlin said during his afternoon announcement that he will work to support the Democratic nominee in 2016.

“I’m going fight to ensure that whoever takes my place as governor is a Democrat with the values and priorities to build upon, rather than undermine, the extraordinary progress we have made,” he said.

neal.goswami@timesargus.com

Shumlin says he will not seek re-election in 2016

MONTPELIER — Gov. Peter Shumlin announced Monday afternoon that he will not seek reelection, and will instead return to his hometown of Putney to resume his role in his student travel business.

The announcement was made at the State House Monday, shortly after he informed his staff and cabinet members of his decision. Many of his current and past staff stood behind him as he told reporters of his plans.

“I am announcing today that I will not be a candidate for a fourth term in 2016,” Shumlin said, after listing what he considers the successes of his tenure as the state’s chief executive.

Gov. Peter Shumlin, with current and former staff behind him, announces Monday that he will not seek re-election in 2016.

Gov. Peter Shumlin, with current and former staff behind him, announces Monday that he will not seek re-election in 2016.

“I reached this decision after a lot of thought and consideration. It is the honor of my life to serve as Vermont’s governor. I want to serve in this role until I feel confident that we have accomplished what we promised to do. By January of 2017, I believe we will have done just that. We’re making tough decisions, we’re taking some risks, and we’re getting a lot of good done for the state of Vermont,” he said. “I decided to make this decision now because I want these next 18 months in office to be focused entirely on continuing the work we started together. And we have a lot left to do.”

The announcement follows a tough re-election fight in November, in which Shumlin received a slim-plurality of the vote against Republican political neophyte Scott Milne. Because Shumlin did not receive a majority of the vote, lawmakers had to formally elect him on the first day of the legislative session in January.

Shumlin said he intends to end his political career when his term expires, and “will not be going to Washington.”

“I have always thought that the right time for a governor to serve is six years. It’s just always the way I have looked at it. I thought that as my third term was evolving, as often happens in life, my perspective might change. It never did,” he said. “I have never wanted to be a full-time politician. I know I’ve told you this before and it’s been greeted with eyes of disbelief, but I’ve never had any desire to live in Washington, D.C., to serve in Congress, to serve in anybody’s cabinet. I truly ran for governor because I wanted to make changes to the state that has given me so much, and then go back to private life.”

Shumlin noted Monday that his administration has boosted the state’s infrastructure, cutting the number of structurally deficient bridges in half. He said his administration has slowed the growth in hospital budgets, and reduced the number of uninsured Vermonters by half. And he has begun to move Vermont away from the current fee-for-service payment model to one that pays health care providers based on health outcomes.

Additionally, Shumlin said his administration has helped the state’s most vulnerable by increasing the minimum wage, and providing more free meals at school to students in need. And, Shumlin said, his administration has altered the way the state deals with its opiate addiction problem.

Gov. Peter Shumlin returns to his ceremonial office in the State House after announcing that he will not seek re-election in 2016.

Gov. Peter Shumlin returns to his ceremonial office in the State House after announcing that he will not seek re-election in 2016.

“When I took office, we politely averted our eyes to opiate addiction in our front yards while we feared and fought treatment centers in our backyards. Today Vermont is one of the most innovative states in treating opiate addiction as the disease it is, saving lives and giving hope, jobs, and a future to those who are suffering while reducing incarceration rates and making our state safer,” Shumlin said.

The governor’s surprise announcement will certainly change the political landscape. Lt. Gov. Phil Scott, a Republican and a member of Shumlin’s cabinet, said last week he was considering a run for the governor. He was not at Monday’s announcement.

And Democratic Speaker of the House Shap Smith told the Vermont Press Bureau after the legislative session ended last month that he wants to be governor, but did not want to run in a primary against Shumlin. Meanwhile, former state senator and current Google executive Matt Dunne, is also rumored to be considering a run.

Shumlin said he would work to ensure a Democrat succeeds him.

“I’m going fight to ensure that whoever takes my place as governor is a Democrat with the values and priorities to build upon, rather than undermine, the extraordinary progress we have made,” he said.

Now that the race for governor features no incumbent, more candidates are likely to explore the idea of running.

Shumlin said he plans to continue pushing for his agenda until his current term expires. He will push for an all-payer waiver from the federal government to transition the state to a new payment model for health care. He also promised to continue reforming the criminal justice system and focusing on opiate treatment. And, he said he would push for ending childhood homelessness, passing paid sick leave, and expanding renewable energy projects in Vermont.

A full story will appear in Tuesday’s editions of the Rutland Herald and the Barre-Montpelier Times Argus.

neal.goswami@timesargus.com

Same-day voter registration signed into law

MONTPELIER — Gov. Peter Shumlin signed a bill into law Monday that will allow voters to register to vote on Election Day beginning in 2017.

The same-day voter registration bill, S.29, makes Vermont the 14th state to allow last-minute registration. Advocates say it will boost voter participation in elections.

Gov. Peter Shumlin signs same-day voter registration legislation into law Monday.

Gov. Peter Shumlin signs same-day voter registration legislation into law Monday.

“It’s so important because for the greatest democracy in the world, the number of people who vote in elections is lower than it should be and hurts our democracy because it’s so low,” Shumlin said before signing the bill at Montpelier City Hall. “One thing that we all know is that if you give folks access to voting, not barriers to voting that have become so fashionable is state after state in America, but access to voting, the numbers go up and democracy is healthier as a result.”

Until Jan. 1, 2017, voters in Vermont must be registered to vote on the Wednesday before an election if they want to cast a ballot. Allowing voters to register at the polls as improved participation where it is already allowed, Shumlin said.

“The numbers all show that with same-day voter registration the numbers go up anywhere from 7 and 14 percent. That is a huge accomplishment to ensure that our democracy remains healthy,” he said.

Many town and city clerks around Vermont have been opposed to the idea, believing it will lead to administrative problems. Clerks expressed concern in testimony to lawmakers that voters could potentially vote in two locations, or perhaps register in the wrong district.

But Montpelier City Clerk John Odum said it will remove a barrier that has prevented some people from voting.

“From my perspective as a clerk it’s, in a sense, a small thing, because this is what we do. This is what we do as Americans. It’s our birthright to choose our leaders, to make our decisions, and this is what we do as clerks,” Odum said. “We are responsible for maintaining a trustworthy system that puts as little interference between Americans exercising that birthright as possible.”

Others, including some lawmakers, have been opposed because they believe it will lead to voter fraud. Voters will be able to register at the polls on Election Day without identification.

Vermont Secretary of State Jim Condos said voter fraud has not been a problem, however.

“It’s nonexistent. It really doesn’t happen. The really true voter fraud is when someone is denied the right to vote,” Condos said.

“This is a voters’ rights bill,” he added. “We have more issues, more times where people are denied and they’re eligible, they’re denied the right to vote, than voter fraud.”

House Speaker Shap Smith, a strong proponent of the new law, said many states are looking to restrict voters’ rights. Vermont’s new law should serve as example, he said.

“Throughout history we have seen the way that you restrict the rights of people who are without power and that is by restricting the right to the ballot box,” Smith said. “This is an important step in the right direction, the direction that we should be going throughout the country, and when many of my colleagues are working to restrict access to the right to vote, I am proud today to have a bill go in to law that allows people easier access to the right to vote. That should be happening around the country. It’s not.”

The law will take effect in 2017 to give clerks time to familiarize themselves with a new statewide voter checklist system. It also allows the new policy to take effect after the 2016 presidential election when voter turnout is expected to be high.

The Vermont Public Interest Research Group and other advocacy groups were strong advocates for the law.

neal.goswami@timesargus.com

Shumlin admin to offer all-payer waiver request by end of June

MONTPELIER — Gov. Peter Shumlin says the state’s preliminary application for an all-payer waiver to level reimbursements to health care providers among all payers will be submitted by the end of June.

A universal, publicly-financed health care system is off the table. And Shumlin’s grand plan to pump additional funds into Medicaid through a $90 million payroll tax was ignored by lawmakers. But the administration has been making steady progress on another major reform in health care — changing the payment structure.

An all-payer waiver will allow the state to move forward with an ambitious plan to eliminate the current fee-for-service payment model that pays providers for each procedure and replace it with a system that pays providers on the quality of care they provide and the health outcomes of their patients.

Gov. Peter Shumlin

Gov. Peter Shumlin

“This is taking Medicare, Medicaid, private pay, in other words our entire payment system, and moving it to one where we literally pay our providers for keeping us healthy and giving them skin in the game,” Shumlin said in a recent interview. “It’s a revolution in the way we pay for health care. They get paid for keeping you healthy not for the number of things they do to you.”

State officials say if Vermont obtains the waiver from the federal Centers for Medicare and Medicaid Services, all insurance plans will pay the same amount and providers will have an incentive to work collectively to have the best health outcome that is not paid for based on the number of tests and procedures performed.

Currently, Maryland is the only state operating under an all-payer waiver, and has been doing so since the late 1970s. But Maryland’s system only sets Medicaid rates for hospitals. In Vermont, the goal is to take it further and include primary care providers and specialists as well as hospitals.

“What we’re talking about in Vermont is doing it with everybody, including Medicare, which is, of course, where the bulk of our money is,” Shumlin said. “It really is a very, very significant conversation.”

Officials with CMS will visit Vermont in the next couple of weeks to work with state officials on its application. The process requires rolling at least two waivers into one document that the state and federal government can agree on. Shumlin said his administration will have the document completed by the end of June, and the state should have an idea this fall whether the project is feasible.

Vermont currently has a Medicaid waiver to spend federal matching dollars outside of more rigid federal regulations. That waiver, known as the global commitment waiver, has been around since the administration of former Republican Gov. James Douglas, but it expires at the end of 2016.

The state’s application will also include a Medicare waiver that will allow it to spend Medicare funds outside the current regulations. However, “In no way does the state take control of Medicare money,” says Al Gobeille, chairman of the Green Mountain Care Board, the state’s health regulatory body.

Al Gobeille

Al Gobeille

“They are such substantially different waivers. What Medicare would be willing to do is relax its payment rules so we could tell them ahead of time how we’re going to do our rules and set our standards of care to meet their measures,” he said.

Completing the state’s preliminary application will only begin a long process of reforming the health care payment system in Vermont, Gobeille said. Once the state and federal governments come to terms, physicians will also have to buy in. Gobeille said the will take its plan to providers and ask them, “What do you think?”

“That begins a whole process of making sure that this is a good idea,” he said.

There are plenty of ways the project could crumble, though, both Shumlin and Gobeille said.

“My take is we’re going to negotiate with the federal government. There’s a possible chance that we could walk away and then maybe next year we try again. I’ve been clear with the governor and the legislature that if we don’t get something that’s a good idea … for both sides then we should exercise caution,” Gobeille said. “I don’t know if this is a good idea or bad idea yet until I know what the federal government is willing to do.”

Shumlin said he is worried about the ability to level out payments from all payers in a way that is fair.

“It could fall apart … at any time because it’s all fine to have everybody sitting around and agreeing that the current system is broken and we’ve got to fix it. The fight’s going to come when start talking about who gets paid what,” he said.

The state’s health care systems — hospitals and their subsidiaries — have varying interests based on their size and location. Shumlin said balanced those interests will be difficult.

“Here’s where this thing could fall apart — who is the person or people that controls the money? Let’s be honest, if it’s the big hospitals you lose all of the little folks. If it’s the little folks, the big people distrust. So, we have a huge project ahead to find an objective, transparent, trustworthy process that everyone can believe in or it will never work,” the governor said.

Reforming the payment system is crucial, though, to bending the cost curve in health care, he said.

“We’re all dead if we don’t get this one right because it will bankrupt us,” Shumlin said.

neal.goswami@timesargus.com

State to move out-of-state inmates to Michigan

MONTPELIER, Vt. (AP) — The Vermont Department of Corrections says the state’s prison inmates being housed out of state are going to be moved to Michigan.

The department said Tuesday it had signed a contract with the GEO Group to house the inmates at the North Lake Correctional Facility in Baldwin, Michigan.

Currently Vermont is housing 319 inmates at facilities in Kentucky and Arizona. That contract expires June 20. The department will begin transferring the inmates to Michigan soon.

The new two-year, $30.4 million contract with GEO will save the state about $2,055 per inmate per year. The state says GEO will provide “comprehensive correctional management services,” including offender rehabilitation programs.

For years Vermont has sent a number of inmates to out-of-state facilities to alleviate overcrowding in the state’s prisons.

Rate increases sought by BCBS and MVP

MONTPELIER — The state’s two health insurance providers offering individual and business plans on Vermont Health Connect have submitted requested rate increases to the state for next year.

Blue Cross Blue Shield of Vermont and has requested an 8.4 percent increase in rates, while MVP Health Care is asking for a 3 percent average rate increase, according to the Green Mountain Health Care Board, the state’s regulatory body for health care issues.

In its filing with the GMCB, BCBS said state and federal mandates are a significant reason for the rate increases for its federally qualified health plans, as well as rising medical and pharmaceutical costs.

“In the absence of mandated changes associated with the Affordable Care Act, a 5.3 percent increase would have been requested,” BCBS wrote in its filing.

Actual rate increases, depending on health plans, range between 4.7 percent and 14.3 percent for BCBS. The changes will impact about 41,000 customers and amounts to about $29.4 million in higher premiums, according to the filing.

“We recognize that this increase is likely to be difficult to absorb for many individuals and small businesses who receive their coverage through qualified health plans, and we have done everything we can to reduce it, without risking access to quality care in the state,” BCBS President and CEO Don George said in a statement. “Unfortunately, a key factor contributing to premium growth has not changed. The Medicaid and Medicare cost shift continues to burden privately insured Vermonters with a disproportionate amount of health care cost increases.”

Increases requested by MVP, meanwhile, range between a decrease of 1.8 percent and an increase of 27.3 percent. The 27.3 percent increase is for the company’s catastrophic health plan.

MVP has a much smaller customer base, however, so the changes will impact 3,324 customers and lead to $951,000 in higher premiums paid.

Gov. Peter Shumlin on Monday said the increases are higher than he would like. But the increases sought for health plans on Vermont Health Connect, the state’s online health insurance marketplace created under the federal Affordable Care Act, are lower than would be expected for plans outside the exchange, he said.

“Let’s be honest, that’s going to look good compared to what businesses are used to,” he said.

Part of the increase should be attributed to the so-called cost shift, the governor said, where private insurance picks up the cost of low payments to providers by Medicaid and Medicare.

“We keep kicking the can down the road on Medicaid, so the cost shift happens to everyone paying for insurance, including the exchange. That’s private insurance,” Shumlin said.

Lawmakers, who wrapped up the first half of the legislative biennium on Saturday, rejected Shumlin’s plan to institute a 0.7 percent payroll tax on Vermont businesses to address the cost shift. The plan would have raised $90 million that would have been matched by $100 million in federal funds. That money would have allowed the state to boost Medicaid payments and ease the burden on private insurance.

Two public hearings will be held by the GMCB at the State House this summer. The public can comment on the MVP request on July 28 and those wishing to comment on the BCBS request can do so on July 29. The board will make a decision by August 13 on the rates that will take effect Jan. 1, 2016.

neal.goswami@timesargus.com

Tax deal struck, adjournment looming

MONTPELIER — After a week of veiled veto threats and behind-closed-doors meetings, Gov. Peter Shumlin emerged from his ceremonial office Saturday afternoon with legislative leaders to announced a tax deal — the linchpin paving the way for adjournment.

“I’m really pleased to announce that we’ve reached a deal on the budget that allows us to balance the budget and raise the revenue for the budget in a way that’s not only fiscally responsible but ensures that we can continue to grow this economy for every single Vermont,” Shumlin said, with House Speaker Shap Smith and Senate President Pro Tem John Campbell on either side of him.

unnamedDetails of the $30 million in new taxes raised to balance the 2016 fiscal year budget were to be released later Saturday.

“Everyone has given a little. I think it’s an incredibly sensible plan and most importantly we’re meeting our commitment that we all pledged to keep in this building in January of closing a budget gap by making smart choices for Vermonters and ensuring that our budget is sustainable going forward,” the governor said.

Lawmakers strike tax deal without gov’s approval

MONTPELIER — House and Senate negotiators were nearing a deal on a $30 million revenue package early Saturday morning that will help balance the 2016 fiscal year budget and close a projected $113 million gap — but includes provisions Gov. Peter Shumlin has said he does not support.

The bulk of the new revenue comes from changes to the income tax code. Both the House and Senate have agreed with the governor to raise $15 million by eliminating taxpayers’ ability to deduct their prior year local and state taxes on their state returns.

Senate Finance Committee Chairman Tim Ashe, D/P-Chittenden, briefs reporters late Friday night on a tax plan. (Photo by Erin Sigrist)

Senate Finance Committee Chairman Tim Ashe, D/P-Chittenden, briefs reporters late Friday night on a tax plan. (Photo by Erin Sigrist)

But the House and Senate are also looking to raise about $10.5 million by making changes to how much taxpayers can deduct. Under the plan lawmakers were nearing agreement on, income tax deductions would be capped at two times the standard deduction — about $25,000 for a couple. The plan exempts charitable donations and deductions for catastrophic health care costs, however.

In total, lawmakers are looking to raise $26 million in new income taxes with the changes.

Shumlin has spent much of the week restating his opposition to lawmakers’ plans to limit deductions. He made that case again to the Vermont Press Bureau in an interview Friday morning.

“The reason states don’t tend to cap these deductions … is because they all provide an important role in ensuring you have a strong economy and a strong state and an economy that works for every single member of that state,” Shumlin told the Vermont Press Bureau in an interview. “Among the tax choices that are going to be made, let’s not make illogical choices.”

Senate President Pro Tem John Campbell, D-Windsor, has said Shumlin has threatened to veto the revenue bill because of his opposition to deduction limits.

But that didn’t stop lawmakers from forging ahead.

Senate Finance Committee Chairman Tim Ashe, D/P-Chittenden, said he worked with the House to complete a revenue plan both chambers could agree on.

“The governor’s made no hesitation to say that he would prefer that the only income tax that’s raised be the $15 million that he raised,” Ashe said. “We arrived at what we thought was a fair way to raise the money and that we could reach agreement with the House.”

House Ways and Means Committee Chairwoman Janet Ancel, D-Calais, echoed Ashe’s comments, saying the revenue plan is one that both sides have agreed to.

“We’re trying to get a revenue bill and trying to get out of here,” Ancel said.

House Speaker Shap Smith, D-Morrisville, acknowledged the tax deal was arrived at without the governor’s approval.

“That is true, yes,” the speaker said.

But the plan addresses many of the concerns Shumlin has raised, according to Smith.

“We’ve responded to a number of the concerns that the governor expressed, particularly around the health care and the charitable deduction. We tried to address that. So, my hope is that in addressing those things we can move closer together. I’m eternally optimistic, but perhaps it is unwarranted in this instance,” he said.

The deduction cap included in the deal is fair, Smith said.

“You’re going to get a $25,000 cap on your itemized deductions. That’s a significant amount of allowable deductions, including, on top of that, charitable deductions and for medical. It seems to me pretty reasonable,” he said.

Lawmakers planned to complete the deal early Saturday morning and return later in the day to have both chambers vote on it. Smith declined to comment on how lawmakers would address a potential veto by Shumlin.

“We’ll take it one step at a time,” Smith said.

Scott Coriell, spokesman for Shumlin, left the State House around 11:30 p.m. Friday and said the administration was reviewing the proposal and would have no comment until later on Saturday.

House Appropriations Committee Chairwoman Mitzi Johnson, D-South Hero, left, and Senate Appropriations Committee Chairwoman Jane Kitchel, D-Caledonia, speak during budget negotiations Friday.

House Appropriations Committee Chairwoman Mitzi Johnson, D-South Hero, left, and Senate Appropriations Committee Chairwoman Jane Kitchel, D-Caledonia, speak during budget negotiations Friday.

The revenue plan also includes extending the state’s 6 percent sales tax to soft drinks, which will raise $5.1 million, extending the 9 percent rooms and meals tax to vending machine purchases, and includes a 3 percent minimum tax on taxpayers earning at least $150,000.

“That’s more of a floor payment on people with larger incomes,” he said.

The House and Senate had also agreed in principal to the budget and were expected to sign off on it early Saturday morning.

Capitol Beat with the Governor 5-15-15

Play

Gov. Peter Shumlin and Vermont Press Bureau chief Neal Goswami chat about the end of the session and the bills that are still in play.

Gov. Peter Shumlin on the Capitol Beat podcast Friday, May 15, 2015.

Gov. Peter Shumlin on the Capitol Beat podcast Friday, May 15, 2015.

House GOP will support veto of tax bill

MONTPELIER — House Republicans voted in caucus Thursday afternoon to help sustain a veto of a revenue bill — if Gov. Peter Shumlin elects to veto the legislation — as House and Senate negotiators look to finalize how they will raise money to support the state budget.

GOP Leader Don Turner, of Milton, asked his caucus to take a position Thursday as negotiators continued to work.

“It’s my feeling that if the governor is going to step up and help us … then I think that’s a good thing,” Turner said.

Shumlin is opposed to how lawmakers have chosen to raise revenue. The House plan caps income tax deductions at 2.5 times the standard deduction. The Senate plan caps mortgage interest deductions and limits charitable contribution deductions to in-state charities.

Shumlin gathered a group of nonprofit leaders on the steps of the State House Wednesday to decry any tinkering with charitable contributions, saying it would cause less giving by Vermonters.

The House GOP caucus voted unanimously to support sustaining a veto after discussing potential pitfalls.

“Is this going to raise his political capital?” asked one member.

“I believe that the governor is doing what our constituents have asked us to do. If that’s the case, why wouldn’t we support it?” Turner countered.

Rep. Kurt Wright of Burlington cautioned the caucus to remember that Shumlin’s original budget proposal raised significantly more in new revenue than the plans passed by both chambers.

“The only thing to keep in mind — the governor didn’t like this tax package, but remember what he started with?” Wright said. “How do you know he doesn’t make a deal with the other side. … He had a larger tax increase on the table to start with.”

In the end, it was an enthusiastic vote in favor of helping Shumlin.

“We all campaigned last year. We all heard the same thing. Everybody in this building heard the same thing. People want their taxes under control. Therefore, if the governor is coming that way I’m more than willing to help him and us do what people asked us to do,” said Rep. Francis “Topper” McFaun, R-Barre Town.

McAllister’s future unclear, but resignation expected soon

This story was updated at 5:55 p.m.

MONTPELIER — Lt. Gov. Phil Scott said Monday that embattled Sen. Norm McAllister, who faces multiple sex crime charges, intends to resign within 24 hours. The announcement came as Gov. Peter Shumlin and legislators leaders all called for him to step down Monday morning.

But in a bizarre twist, McAllister, R-Franklin, reached by phone at his home Monday afternoon, said he was not aware that anyone had reached out to Scott to promise his resignation. McAllister said he has made no determination about his future and planned to meet with his lawyer Tuesday. He declined to discuss the case any further, but said he has “had better days.”

“My lawyer has told me not to talk to anybody about any of this,” McAllister said. “I’ll be talking to my lawyer tomorrow.”

His lawyer, Brooks McArthur, did not return a message seeking comment.

Sen. Norm McAllister

Sen. Norm McAllister

Later in the day, Scott confirmed that Sen. Peg Flory, R-Rutland, served as the messenger. Scott said Flory was in touch with McAllister throughout the weekend and relayed the message of his pending resignation. Flory spoke again with McAllister Monday afternoon and he is still expected to resign, according to Scott.

“I stand by what I was told and I still believe that I will receive his letter tomorrow morning,” he said.

Scott said he decided to reveal McAllister’s intention to resign after Shumlin and others called for him to step down.

“To be clear, I wouldn’t have announced it this morning without having it physically in my hand — until I heard the governor demanded his resignation and I thought, ‘Well, actually, he’s said he’s going to resign,’ and I thought it was important that I get that information out,” Scott said. “Maybe I shouldn’t have gotten involved but I just felt I had that and I should let people know because it was (McAllister’s) idea.”

McAllister, a second-term senator who previously served five terms in the House, pleaded not guilty Friday to charges of sexual assault and prohibited acts. Detailed court documents allege that McAllister forced women to have sex with him in exchange for rent and used sex as a punishment, among other things.

Seven Days reported over the weekend that one victim, who worked for the 63-year-old McAllister on his farm as well as an assistant or intern in Montpelier, alleged that she was possibly as young as 15 when he first assaulted her.

The charges and explicit details about the allegations released Friday in police affidavits have shaken many inside the State House as they work toward adjournment this week.

Scott, a Republican, told reporters McAllister promised early Monday morning to resign within 24 hours.

“I received word earlier this morning that within 24 hours I’ll be receiving his letter of resignation,” Scott told the Vermont Press Bureau.

Word came through a representative of McAllister’s, later revealed to be Flory at 7:30 a.m. “I have not spoken directly to him,” Scott said.

If a letter of resignation is received, Scott said he will hand it over to Senate Secretary John Bloomer who will then notify the governor and Senate President Pro Tem John Campbell, D-Windsor. The governor will eventually need to appoint someone to fill the remainder of McAllister’s term.

Scott said Monday that McAllister’s resignation is needed.

“I read the affidavit. The allegations are very serious, very troubling, to say the least. I feel that Sen. McAllister is making the right decision at this time. I think the people of Franklin County deserve a legislator that can devote themselves to their needs and I don’t think he can do that at this time,” the lieutenant governor said.

Earlier Monday, Shumlin, a Democrat called on McAllister to resign now that he is going through the judicial process.

“Given, the incredibly troubling allegations made against Sen. McAllister over the past several days, the right thing for him to do would be for him to resign from the Senate,” Shumlin told the Vermont Press Bureau in an interview. “Sen. McAllister will go through the legal process like any other accused individual, but for the good of Vermont he should not do so as a sitting senator.”

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