Green Mountain Care Board urges higher CON thresholds, proposes lower equipment and operating limits

Chair Foster, chair of the Green Mountain Care Board, told the House Health Care Committee on Feb. 6 that the board "does agree that the CON laws should be modified" to allow more low-cost providers into Vermont and reduce administrative burdens.

The board supported raising the capital-construction threshold to $10,000,000, a position Foster said he agrees with "without a distinction between hospitals and non hospitals." The board also recommended a $5,000,000 threshold for equipment costs rather than $10,000,000, and a $3,000,000 annual operating-expenses threshold for review.

Why it matters: certificate-of-need (CON) statutory thresholds determine which hospital or nonhospital projects must undergo state review before construction or service expansion. Increasing thresholds reduces the number of projects that trigger review and can speed entry for smaller providers; it also reduces workload for the Care Board and applicants, the board said.

Details from testimony: Foster said current indexed construction thresholds are roughly $3.7 million for construction (previous statutory figures were lower in older statute language). He described existing equipment thresholds as $1.8 million for hospitals and $1.2 million for nonhospitals under current indexing. As examples of past reviewed purchases, Foster cited a 2023 UVM purchase of a da Vinci surgical robot for about $2.5 million, a 2023 CT-scanner replacement at $3.5 million, and a 2022 MRI replacement at about $3.1 million. He said most historically reviewed equipment purchases would be exempted under a $5 million equipment threshold.

Foster also told the committee that the board supports increasing the conceptual-CON threshold (the point at which projects must seek preliminary approval to plan very large projects) from $37,000,000 to $50,000,000 so that very large planning costs are reviewed earlier in the process.

Exemptions and process points: Foster said the board supports a statutory exclusion for projects that are the result of a state-awarded contract, explaining, "If the state is awarding the contract and wants to go forward with it, we think that that's adequate diligence into the need and the appropriateness of the project." He also noted S.10 contains an exemption for routine replacement of fully depreciated medical equipment and for emergency and nonemergency ground ambulance services and supplies; the board said those exemptions are appropriate.

What the board reviews: Foster described the board's CON review as assessing need, project cost reasonableness, pricing conditions and consumer protections. He said prior CON approvals included conditions such as capping commercial prices at the national average for outpatient surgery and requirements that new outpatient providers accept Medicaid.

Outstanding questions: Committee members asked whether applicants pay fees for CON processing and when financing must be shown. Foster said staff handle jurisdictional determinations and application procedures and that he would "get that information to you very quickly." Members also asked about wording in H.96 that uses "includes" in the definition of a new health care project; Foster suggested clarifying language such as striking "includes" or using "including but not limited to" per counsel.

Ending note: Foster emphasized that the board's positions reflect internal discussion and that not every board member had formally signed off on each specific numeric recommendation, but that "we do agree with increasing it" as a policy direction.