Weekly State House Newsletter- 2.3% Provider Tax and Education Spending

Here is Campaign for Vermont’s statehouse report for the week of February 1, 2016.

Budget: One (of many) controversial components of the Governor’s budget is his proposal to raise 17 million dollars in new revenue by way of a 2.3% “provider tax” on independent physicians and dentists. This week’s testimony in the House Ways and Means Committee by solo and small group practitioners was partly a cry for recognition of the benefit of their small size and strong community ties with patient relationships that span generations. It was also a dire warning that the provider tax could put them out of business or drive dedicated young professionals out of Vermont. Here are their presentations to the House Ways and Means Committee.

It’s hard not to smell a rat here. Lurking in the background is the Vermont’s Green Mountain Care Board‘s proposal to the federal government for the establishment of an “all-payer” health care model.  This is a complicated proposal but it is completely based upon the “ACO” (Accountable Care Organization) model of health care delivery. That model has been criticized as creating “a monopoly on health care” by hospital owned and controlled ACOs with an ultimate objective of merging them into a powerful single provider entity.



The all payer proposal does not require legislative approval. During a Green Mountain     Care Board presentation to the House Ways and Means Committee on Friday, Chair Janet Ancel asked the pointed question, “What if we don’t like ACOs?” The response was basically that the train had left the station.

So while its uncertain at best whether voters can have much of an impact on the “all-payer” proposal, if you value your small town  “country doc” then heads up on the provider tax increase. 

Education Spending: During the first house floor debate on amending Act 46 spending caps some legislators spoke openly about the sense of helplessness school boards experience in trying to keep education tax rates down. Given our statewide system of education funding, there is a need for a complete overhaul of the incomprehensible education finance system. CFV has been promoting this since our inception.


While there is little momentum this session to tackle the huge task of overhauling our education finance system there are easier ways to begin cost control, starting with an established standard for a student–teacher ratio tied to funding.  With less than a month left before crossover (the date when bills must go from one chamber to the other) no bills creating a mandated student-teacher ratio have been introduced. 

Several representatives have sponsored a bill to create a statewide teachers’ contract with a cap on teacher salaries. The bill is currently in the House Education Committee. A statewide teachers contract to cut costs is hardly a new idea.


Meanwhile here is what is really driving the large increase in teacher health care costs that led to the alteration of the original spending caps in Act 46.


With town meeting day just around the corner the big question is how voters will react to having their plea for property tax relief ignored.

Power Alley: Power Alley, our new tool for informing you of the votes of committee members on significant issues, has been launched with a first installment covering  recent votes to effectively remove meaningful Act 46 spending caps. Please let us know if we can improve upon this service in any way. There is no better means of affecting change than your direct communication with your legislators on important votes.

As always we need your support and donations so we can continue our efforts to watchdog and attempt to influence the legislature and to help you to do the same.  A contribution of $50 or $100 dollars would be greatly appreciated and well used. We do recognize that not all of our supporters can afford this so a donation in any amount is valued. Thank you for all of your past support. Please renew that support with a donation.

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Barbara Crippen
Policy Coordinator

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