by Michael Del Trecco, CEO, VAHHS This week begins the annual hospital budget hearings for fiscal year 2024. Each hospital will go before their regulator, the Green Mountain Care Board, to present and defend its budget and answer questions from the board and their staff. This is just one part of a months-long process.  

As you’ve likely heard me say before, we are a fully non-profit hospital system in Vermont. That means that every dollar that passes through our organizations is reinvested in staff, equipment, supplies and our communities. There are no shareholders or hedge fund owners earning a profit. The result of this structure is hospitals collaborate, rather than compete, to deliver care. As Vermonters, this makes perfect sense to us. 

But you may be surprised to know that this is not the case in most states, where for-profit and non-profit hospitals exist just blocks from one another, competing for the most profitable patients and to perform the more profitable procedures to the detriment of those less desirable.

That non-profit standing is more than just a tax status. It’s a mindset for our people. These hospitals exist entirely to serve their communities and are determined to meet their mission, no matter the difficulties. I can tell you unequivocally that each and every hospital took great effort to examine expenses and reduce costs where they could safely and reasonably do so. These budgets are responsible and expertly crafted to keep costs down where possible—and never jeopardize services or care.

System-wide, we are at just a 2% margin and most of our hospitals have had even smaller or negative margins over the last several years. We know that low and negative margins will lead to unitintended distruptions to our patients and we must avoid this at all costs. We must get to a place where hospitals are able to achieve a healthy margin to balance the needs of patients and staff while allowing each organization to make the necessary investments to remain current with new technologies and continue on the path of health care reform.  

Importantly, these budgets are about people. For most of our hospitals, the majority of their budgets are comprised of salary, wages and benefits for caregivers—and rightfully so. We cannot automate care like a manufacturing facility can. And we can’t rely on ChatGPT to diagnose a complex set of symptoms or comfort a patient. We need people—human beings—in every department and at all levels, who are well-trained and care deeply for our patients.

Above all, our hospital budgets are strong, well-reasoned and represent only what is needed to care for patients and deliver on our mission and our promise to the communities we serve. That is why we respectfully ask the GMCB to approve our budgets as submitted.

You can follow along the process by visiting the Green Mountain Care Board Hospital Budget Review web page.

Vermont Association of Hospitals and Health Systems. August 7, 2023