Green Mountain Care Board briefs Appropriations on budget structure, reference‑based pricing and transformation funds

Owen Foster, chair of the Green Mountain Care Board, and Emily Brown, the board’s executive director, appeared before the House Appropriations Committee on Feb. 5 to outline the board’s FY27 budget posture, funding sources, and ongoing system‑transformation work.

Foster said the board had no separate FY27 budget request beyond meeting the governor’s recommendation. He described the Care Board’s funding structure as approximately 40% general fund dollars that are matched by about 60% in bill‑back charges to regulated entities (hospitals, insurers and accountable care organizations), calculated from prior‑year actual spending and statutory formulas. "Our mission, we're focused on access, affordability and quality in health care," Brown said.

Foster and Brown summarized major board expenditures: staff salaries and benefits (the board anticipates about 40 staff when fully staffed), consultant and contractor costs for data and actuarial analysis (they cited large contracts such as the Oliver Wyman report), and two positions funded by a special evidence‑based fund to support prescription‑drug regulatory work. Foster said the board uses prior‑year actuals to determine bill‑back amounts and allocates hospital shares by net patient revenue and insurers by earned premiums.

The delegation described federal transformation funds and an AHS‑led cooperative agreement that would provide multi‑year grant money for projects including a GMCB data‑infrastructure project. Brown said the data project would total about $14,000,000 over five years to build internal capacity and reduce reliance on contractors. Foster discussed Project 2030 — an outside oversight effort to help UVM Health reassess its footprint and reduce costs after budget excesses — and noted the board has rarely used its stronger statutory authorities (for example, subpoena authority used once in 14 years; observer authority never used).

Committee members asked whether the Care Board has capacity to analyze statewide administrative savings and how reference‑based pricing would affect hospitals and premiums. Foster said the board can perform system‑level analysis and target large administrative line items, but detailed hospital‑by‑hospital dives are complex. He described reference‑based pricing as a gradual mechanism to bring commercial prices closer to Medicare norms and said the board tries to moderate price growth via guidance (for example, encouraging a 0% rate increase in a given year) while coordinating with rural transformation funds to preserve access.

Foster and Brown also discussed the all‑payer/AHEAD model experience and current federal negotiations; they said the model's future and amendments are uncertain and any amendment will require agreement by all parties. The committee did not take a vote; the board will be involved in the Joint Fiscal Committee’s public review of a cooperative agreement tied to the transformation grant.