Rutland Regional CEO backs reference‑based pricing, urges caution on S126 reporting expansions

Judy Fox, president and CEO of Rutland Regional Medical Center, told a legislative panel that while her hospital supports many aims in S126, portions of the bill are redundant with reporting the hospital already submits to the Green Mountain Care Board and could create administrative burdens that raise costs.

Fox briefed lawmakers on Rutland Regional’s scale: about 60,000 community members served, roughly 6,500 inpatients annually, more than 100,000 clinic visits, about 300,000 testing encounters, and roughly 1,800 employees including 140 physicians and advanced practice providers. “Rutland, we're the second largest hospital in the state, but we're the largest employer in Rutland County,” she said.

Nut graf: Fox recommended using the Green Mountain Care Board’s existing budget‑reporting processes rather than adding parallel reporting requirements in S126; she also supported carefully staged payment reform — including reference‑based pricing pilots — warning that Vermont’s Medicare reimbursement baseline differs from other states and that immediate, large rate changes could destabilize local services.

Key testimony points

- Redundancy and confidentiality concerns: Fox said S126 asks hospitals to provide data on administrative vs. patient‑care classifications, base and variable compensation, and other details that Rutland already reports to the Green Mountain Care Board as part of its budget guidance and 990 filings. She cautioned that detailed public disclosure of salaries could create recruitment and competitiveness problems.

- Excluding primary care/behavioral health revenue: Fox supported excluding primary care, mental‑health and substance‑use disorder revenue from certain reporting calculations — but asked that expenses tied to those services also be waived in parallel so the measures don’t create under‑funded obligations.

- Global budgets and payment reform: Fox said Rutland supports global budgets in principle but reminded lawmakers the state’s Medicare reimbursement levels are lower in aggregate than many states. “When we looked at the services provided in Vermont and the services provided in other states, Vermont was about $350,000,000 below in reimbursement,” she told the committee, referencing AHS and Green Mountain Care Board evaluations.

- Reference‑based pricing and pacing: Fox endorsed reference‑based pricing as an objective and recommended a phased approach with pilot groups rather than a single large shift. She said Rutland would face a roughly $50 million impact if commercial payments were universally set to 200% of Medicare in a single year and urged gradual implementation instead.

Context and supporting detail

Fox noted Rutland’s existing reporting obligations to the Green Mountain Care Board (budget narrative and other operations sections) and recommended relying on that “single source of truth” rather than creating parallel statutory reporting. She also warned that service closures do not automatically save money statewide because patients typically shift to other hospitals; she cited Central Vermont’s inpatient psychiatric unit closure and said about 40 patients from that service area subsequently received inpatient psychiatric care at Rutland.

Quotes and attribution

- “Rutland, we're the second largest hospital in the state, but we're the largest employer in Rutland County,” Fox said. - “If Rutland were to do [200% of Medicare] holistically, we would lose about $50,000,000 of reimbursement,” she said, urging a stepped approach. - “This information should not be overly public; it needs to be held tightly because it will create competitiveness issues and recruitment issues,” Fox said about granular salary reporting.

Ending

Fox offered Rutland’s assistance in designing pilots and a staged pathway toward more transparent, benchmarked payments, while urging lawmakers to avoid redundant reporting requirements and to account for Vermont’s distinctive Medicare reimbursement baseline when setting targets and timelines.