Committee advances bill raising Green Mountain Care Board certificate-of-need thresholds

The House Ways & Means Committee voted favorably to advance H96 on Feb. 27, approving changes that raise multiple monetary thresholds that trigger a certificate of need review by the Green Mountain Care Board and add two new category exemptions. Representative Masland moved the favorable report and the committee recorded unanimous support among members present; two members were absent.

The bill increases several dollar thresholds in existing certificate-of-need (CON) law. Under current law a nonhospital capital project costing more than $1,500,000 requires a CON; H96 would raise that construction trigger to $10,000,000. The bill raises the single-piece diagnostic or therapeutic equipment trigger from $1,000,000 to $5,000,000 and raises the annual operating expense threshold for offering a new service or technology from $500,000 to $3,000,000. For hospitals the construction threshold would rise from $3,000,000 to $10,000,000. H96 also raises the threshold that requires a conceptual development certificate for very large projects from $30,000,000 to $50,000,000.

The measure adds two specific exclusions from the CON process. It exempts medical equipment that is fully depreciated from needing a CON for routine replacement, and it exempts both emergency and nonemergency ground ambulance services, agencies, and the equipment and supplies they use. The bill directs the Green Mountain Care Board to index certain thresholds to the consumer price index going forward.

Jennifer Harvey, legislative counsel, summarized the bill to the committee: "H96 is an act relating to increasing the monetary thresholds for certificates of need." Harvey described the practical effect: projects that previously would have required board review will fall below the new thresholds and no longer require a CON, and she noted the bill allows already-filed applications to proceed under the old rules when an interested party has been granted status.

The bill sets an effective date of July 1. Harvey explained the transition rule: if an application is pending on that date and one or more persons already have been granted interested-party status, the application stays under the old jurisdictional thresholds; "if there's a certificate of need application already in process on that date and no one has been granted interested party status, then this would allow the applicant to withdraw the application and just proceed with their project without finishing the CON process," she said.

Alan, speaking for the Joint Fiscal Office, provided the fiscal note. "Over the past seven years, the Green Mountain Care Board has collected approximately $50,000 per year on average in fees related to review of certificate applications," he said, and estimated H96 could reduce that revenue by as much as $20,000 per year on average. He added the board expects to absorb the reduction within its existing budget because of staffing constraints.

Committee members asked how common CON applications are and which purchases would trigger review. Harvey and others answered that large capital expenditures—"machinery" such as MRI units or building a new wing—could trigger a CON when they exceed the statutory thresholds. One committee member voiced a concern about voting without more background: "Probably shouldn't, I don't have enough information," said Representative Higley during the discussion, although the committee proceeded to a roll call vote.

Representative Masland moved that the committee report H96 favorably as received. The committee recorded the following roll-call votes: Representatives Brandigan, Burkhart (Bridget Burkhart), Phelpsis, Higley, Holcomb, Kimball, Masland, Canfield and Kornheiser voted yes. Representatives Ode and Wozozak were recorded absent. The motion passed and H96 advanced out of committee as favorably reported.

The bill retains the existing CON fee structure: a filing fee set at 0.125 percent of project costs with a maximum fee of $20,000 and a minimum fee of $250. Committee discussion and the fiscal note framed the policy trade-off: fewer CON applications and fewer application fees collected, but reduced regulatory burden and fewer maintenance projects requiring review under the CON process.

The committee did not adopt amendments during the meeting. The bill as reported by the committee will move forward under the legislative process for further consideration.