Health committee adopts S.63 amendment that removes 'contested case' label for hospital budget enforcement; Rutland Regional urges keeping VAPA protections

The House Health Care Committee voted to approve S.63 as amended, adopting language that says the Green Mountain Care Board's review, establishment and enforcement of hospital budgets "shall not be construed to be a contested case" under the Vermont Administrative Procedures Act (VAPA), and that appeals of final board actions would proceed under the board's existing appeal statute.

The amendment drew sharp testimony from hospital counsel who said removing contested‑case procedures would undermine due process and risk more litigation. Supporters of the amendment and board counsel said the change clarifies appellate pathways and reflects staffing and operational limits at the board.

Mitchell Baruti, Vice President and Chief Legal Officer at Rutland Regional Medical Center, told the committee he and his hospital had participated in the board's process but argued participation alone does not supply "procedural due process that also results in fairness under the law." He said: "When a state agency takes retrospective action that reduces a hospital's revenue and scrutinizes its past decisions and imposes corrective steps based on complex factual determinations. That is not policy, but adjudication. And adjudication under Vermont law requires contested case procedures." Baruti warned that without contested‑case protections hospitals would be denied "the opportunity to present and challenge evidence" and could face decisions made on "untested assumptions or data that 1 party never had the chance to question."

Jen Carvey of the Office of Legislative Council explained the amendment's statutory mechanics, saying: "Any person aggrieved by a final board action, order, or determination under this section may appeal as set forth in section 9381." Carvey summarized that the statute requires the board to adopt administrative appeal procedures and that an aggrieved party may appeal to the Vermont Supreme Court after exhausting administrative remedies.

Mark, an attorney for the Green Mountain Care Board, told the committee the amendment contains two pieces: (1) clarifying that enforcement appeals from the board go to the Supreme Court rather than to superior court and (2) the narrower and more contested question of whether contested‑case procedures apply. He and other board representatives said their concern is practical: if full contested‑case procedures (formal rules of evidence and cross‑examination) must apply to every enforcement hearing, the board may lack the staffing to carry them out while also meeting its statutory duties.

Committee members pressed both sides on consequences. Some said directing appeals to the Supreme Court streamlines the appellate path; others said eliminating contested‑case procedures would create uncertainty and could increase litigation. Baruti argued that contested‑case procedures would reduce ambiguity and litigation because they create "a record that can be reviewed, challenged" and decisions "based solely on the evidence presented." Board counsel and members said they are open to working with hospitals and other stakeholders to clarify the statute and to develop procedures that balance fairness and administrative capacity.

After discussion the committee approved the committee amendment to S.63 (draft 1.2) and then voted to report S.63, as amended, out of committee. The roll call on the final motion recorded eight yes votes and two no votes; the committee clerk announced the vote as 8‑2‑0.

Committee leaders and witnesses agreed to continue stakeholder discussions after the markup to clarify the scope and procedure for budget enforcement and appeals, and to examine whether statutory or rule changes are necessary to preserve fairness while keeping the board able to enforce budget orders.

The committee's action will change the statutory language governing how the Green Mountain Care Board's budget reviews and enforcement actions are characterized and where appeals may be taken; the precise operational effects and any downstream litigation remain uncertain and depend on subsequent rulemaking, staffing, and possible future statutory clarifications.