Vermont witnesses back bill’s intent to curb corporate control of medical decisions but warn language could burden small practices

Jess Barnard, executive director of the Vermont Medical Society, and Susan Ritson, executive director of Vermont Health First, testified to a legislative committee that they broadly share the goal of preventing corporate investor practices from controlling medical decisionmaking but urged lawmakers to narrow the bill’s language to avoid harming small independent providers.

Barnard said the bill’s stated aim—to stop private equity and other investors from stripping assets or interfering with clinicians’ judgment—is one the Society supports. She cautioned, however, that several provisions in the draft (referred to in testimony as H.583) are written so broadly they could prohibit routine financing, partnerships, and other transactions that independent practices use to survive and expand. "There are 49,546 licensed health care professionals in Vermont," Barnard said, citing an Attorney General’s Office spreadsheet, and asked how the state would educate or process reporting obligations for so many providers.

Both witnesses criticized a provision Barnard identified as the prohibited-transaction section (referred to in testimony as section 5925). She said the language—drafted to bar transactions that use debt to acquire a health care entity—could be read to forbid ordinary loans, mortgages or other financing methods that enable clinician-to-clinician sales or practice mergers. "Again, we heard testimony that maybe that was intending to get at leveraged buyouts," Barnard said, "but debt includes mortgages, bonds, other loans, and there is nothing in the language now saying that allowing that to continue." She urged the committee to narrow the prohibition so it targets predatory behaviors instead of broadly banning financing.

The witnesses also raised concerns about the bill’s reporting and confidentiality regime. Barnard noted that many small practices do not undergo annual audited financial statements and that making such statements public could create antitrust or competitive harms when practices negotiate with payers. She warned that tying enforcement to the Consumer Protection Act could permit citizen suits as well as Attorney General enforcement, increasing litigation risk for small providers.

On restrictive covenants, both witnesses expressed support for banning noncompetes in health care and urged the committee to refine the language to address cross‑border contracts and retroactivity. Barnard said she and other provider associations submitted alternative statutory language that would define private equity and hedge funds and explicitly bar those entities from interfering with clinical judgment rather than imposing broad ownership limits.

Susan Ritson described Vermont Health First’s network—"66 member practices across 11 counties" with roughly "235 physicians and APPs"—and highlighted the growing share of direct‑care and concierge models in their membership. She asked whether the draft bill would prevent participation in Medicare‑only ACOs, professional employer organizations, independent practice associations, or the use of loans to start, expand, or upgrade practices. She urged exemptions or an attestation path for practices not engaging in prohibited transactions and argued for confidential reporting of sensitive financial information.

Committee members and other witnesses pressed practical questions: could existing Medicare and Medicaid ownership disclosure be accepted in place of a new reporting regime; how would the Green Mountain Care Board or Attorney General use the data; and whether the Department of Financial Regulation could advise on institutional investor mechanics. A witness from the banking/regulatory side asked the committee to distinguish "bad actors" from legitimate investors so necessary capital remains available for mergers or to rescue struggling providers.

The hearing produced no formal vote or committee direction; panelists said they will continue to revise the draft and coordinate with related work in House Commerce on noncompetes (referred to during testimony as H.205). Several witnesses offered to provide model language and additional information to help the committee target predatory practices while preserving common financing and ownership transactions that support access to care.

The committee recessed and said it will resume work on the bill the next day.