 So it is 830, so I'm going to call the meeting to order. And I'm going to say a few words, but before I do that, I was going to turn it over to Susan Barrett just to announce some public comment periods. Susan. Thank you, Mr. Chair. A few announcements. First, the board is accepting public comment on the FY22 budgets, hospital budgets. That started on July 28th and it runs through September 1st, 2021. The schedule for the next few weeks of hearing is located on our website under the hospital budget tab. And just to remind you- Excuse me, Susan. Yep. Since it's Joanne, I'm having trouble hearing you. Could you take up please? Sure. Thank you. So the hospital budget hearing schedule is located on our website. Under the hospital budget tab. As a reminder, all of our meetings for the hospital budget hearings will be held remotely. Members of the hospital teams will be using our teams function and will be conducting these meetings remotely. However, per open meeting law for the state of Vermont, we do have a physical location, but the board and the participants will be participating in these meetings remotely. The board deliberations will start on September 1 and the board will vote no later than September 15th on the hospital budgets. And we do ask that you submit your public comments to our public comment portal or call Abigail with any comments or email her prior to September 1 so that the board can consider them in their deliberations. And just as another reminder, which I will, I remind folks on every public board meeting that we are encouraging the general public to submit public comments on a potential next agreement between the state of Vermont and CMS on an all payer model. Any of our comments regarding that are sent, any of those comments are sent to our partners at the AHS and the governor's office as they are leading the negotiations on the next model. And that is all I have to report. I would, I checked in with Abigail this morning and we did not have any public comments yet on the hospital budgets, but we will post those as they come in and I will turn that back to you, Mr. Chair. Thank you, Susan. And just as a reminder, that physical location is 144 State Street in our conference room and staff is there and any member of the public can participate through the physical location at 144 State. With that, I just want to say that today is the first day of hearings for hospital budgets. And last week it became very clear to the state of Vermont that based on projections and everything that's happening around us, that we could be in for a rocky road, especially at our hospitals over the next 21 to 30 days. And despite the great work by all Vermonters to have the highest vaccination rate in the nation, we are not immune from what's happening in the world around us. And there is an uptick in COVID cases and there is an uptick in hospitalizations. And if you model that out as the state has done, it shows that we could actually have peak hospitalizations higher than what we had last November. And the state of Vermont through Secretary Mike Smith has asked hospitals to ramp back up and to make sure that they have the COVID beds, that they have the testing and that they have the vaccination. And this comes at a time where all hospitals are dealing with the extreme stressors of the pent-up demand that was created by the lack of willingness from people to do the prevention services and putting off some non-emergent services during the pandemic. So hospitals like all businesses around this country are stressed right now. And hospitals don't have the luxury that a number of other businesses do. When you take a look at some businesses have reduced hours or reduced services, things like that, hospitals can't, they can't close their door. They're open 24-7, 365. And so they're dealing with this. They're dealing with this all at a time where there's a nationwide shortage of people to staff all positions in hospitals, whether it's providers, nurses, technicians, you name it, it's a difficult time. And they've done Yeoman's work during these difficult times. With what Mike had asked the hospitals to do, there were some questions by hospitals about whether or not there could be any reduction in the regulatory process. And fortunately at this point in time, most hospitals have done all the heavy lifting of the actual written submissions and all the data. But the board is not unsympathetic. We would have to vote in an open public meeting like today to do anything differently. But fortunately, the two people presenting today, the two entities, the institutions of Southwest Vermont and Brattleboro Memorial chose to move ahead. And we don't know how others might wish to do something different like maybe wave a hearing. And we're gonna be hearing from Jeff Thiemann shortly and he may know more, more might have developed since our last conversations. But I do think that the vast majority of the work has been done by the hospitals and really wanna give a big thank you to the team at Southwest and the team at Brattleboro for moving forward today. It would have been difficult to have had a conversation about how to do anything different in the process on the very first day. And there just wasn't time to notice and call a meeting to do anything differently. So again, a big thank you to these two hospitals today. And with that, if there are any questions on the board on anything that I've just said, I'll answer those. Otherwise, I'm gonna, as we always do, call on Jeff Thiemann for a few words and then I'm gonna call on Mike Fisher for a few words. So do board members have any questions about anything I've just said? So hearing none, Jeff, I'll call on you first and then I'll call on Mike, Jeff Thiemann. Great, thank you, Mr. Chairman and thank you for your comments. I agree with all of them. Good morning to everyone. I appreciate the chances, as Kevin said, to make some comments like I do when this process begins every year. For those who may not know, I am Jeff Thiemann. I'm president of the Vermont Association of Hospitals and Health Systems, which represents our network of nonprofit hospitals here in Vermont. I plan to focus my comments today on a difficult trifecta of issues that I think Kevin Mullen just touched on and those are workforce, COVID and inflation. In the five years that I've been in this job, including the really perilous last 18 months, I have never seen hospitals so challenged. In many ways, we are in the most intense part of the pandemic so far. As Kevin said, our hospitals are increasingly full. They are full of sicker people and their capacity is being further tested and stressed literally every day. We have patients who are seeking care for mental health conditions and find themselves stuck in emergency departments when they need and deserve a much better space for treatment. In terms of COVID, as Kevin said, we're back in the business of prevention and vaccination and testing. And complicating all of it is the monumental workforce challenge that creates new problems every day, new expenses every day and has left our existing staff flat out and burned out. So given all these factors and how hospitals are really squeezed by them right now, as Kevin said, you may hear a couple organizations request some degree of relief from this regulatory process. I have actually not heard of any that are currently interested in doing that, Mr. Chair, but I will keep you posted on that and understand that the board will need to deliberate. Should that be the case? I think as you and I talked about last week, most hospitals do want to tell their story, but as that changes, I'll keep you notified. As you also said, hospitals have already submitted their budgets. They've done the hard work and I think they've done it with their mission in mind. I would say that now as a result is not the time to add to their concerns around financial stability, the hospitals have submitted these budgets because they represent what's required to care for their patients, to meet the need of the community and to continue leading us through the public health crisis as they've done so well so far. In terms of the budgets, a couple brief notes that are worth highlighting, I think. First is that Vermont hospitals charge master increases over the past three years average about 3.8%. And our revenues are growing slower than Medicare's estimate of healthcare inflation. Without other operating revenue, Vermont hospitals would have reported a negative 6.8% operating margin versus the still thin 2.3% positive margin they collectively report now. It's also important to note in this space, hospitals gratitude for the CARES Act funding they received last year to be stabilized. The appearance of healthy hospital balance sheets and income statements today is largely the result of federal monies without which we would have faced financial ruin and you would have seen hospitals close their doors here in Vermont and elsewhere. So with that backdrop, as you listen to these budget presentations, I ask that you appreciate the effect of a few key factors. First, that we're still very much in the middle of the pandemic. As Kevin said, case growth right now is as high as it has been and our hospitalization projection is daunting. Meanwhile, the situation remains really uncertain with variants and I'm hearing reports from my counterparts like the one in Oregon of seeing significant supply shortages on top of everything else we're managing. Second, this budget process starts long before today. Instead of building budgets based entirely on need, the Green Mountain Care Board sets parameters through its guidance and then hospitals try to manage their budget within those limits. Then hospitals come before this board with the possibility of seeing those budgets cut even further. This process may keep costs down but has also left hospitals with less room to respond to the crises we now face. The hospitals have tried really hard to meet the conditions of the budget guidance. If they didn't need what they're asking for, they would not be asking for it. Third, patients have delayed care during the pandemic as Kevin also mentioned and that has caused many to come in sicker than they would otherwise. This has led our hospitals to see significant census increases, which has further stretched staff and even increased wait time. In addition, as I alluded to before, we have been managing a mental health crisis since well before the pandemic and it continues to require a response at all points along the continuum. Fourth, the workforce challenge we face is so urgent and so severe that it affects every other piece of our business from the time's patients wait for a procedure to the cost of labor at all points. And last, hospitals have played a pivotal role in keeping Vermont safe and weathering the worst of the pandemic. This is a really important reminder of how hospitals are a critical part of our infrastructure and the public health apparatus that makes Vermont at the top of the list. Similarly, with the continued uncertainty that we've been talking about already today, hospitals must remain prepared. So thank you as always for your careful and thoughtful consideration of these budgets. I think we made the best progress during the pandemic by working together and understanding the situation we face collectively. I think that's still true today. That's why I appreciate the chairman's remarks. And I hope that that collaboration and partnership continues throughout these hearings and beyond. Thank you so much and good luck. Thank you, Jeff. Next I'm gonna call on the healthcare advocate, Mike Fisher, good morning, Mike. Good morning, good morning, Mr. Chair, members of the board and hospital community. I will also echo much of what both Kevin said and Jeff Thiemann just said with appreciation for what it's like to be on the ground at this moment. I think we all have our own version of that, but you have a particularly different perspective and I would be remiss if I didn't pause and recognize that. I thought it made sense for me to say a few things now instead of saying it in the context of any individual hospital's budget because they're really higher level statements about the process. And so it's my hope that the hospitals they're going today and the hospitals they're going for the next two weeks have an opportunity on some level to hear what I'm saying here. So first about our question one this year, reimbursement ratio relative to standard Medicare reimbursement. Again, it was a comment about the overall process not directed at any individual hospital. I recognize that many of you made some real efforts to answer this question, I appreciate it. We've asked this question on some level for four years. We've had various approaches over that time, including this year's based on the RAND approach. Yet we still feel like we're not closer to an apples to apples comparison of charges across the hospital system. This to us seems like a fairly basic need. We need to understand the base before we consider how much to raise each hospital's rates based on the needs in that individual hospital. Every year we hear offers of help from various entities and we appreciate that. I'm not here to question anyone's motive. I know how complicated the world is, but after four years we don't feel like we're any closer to any kind of reasonable answer. So going forward, HCA will continue to push again for some kind of reasonably accurate answer to this question, we know it's complicated. We know that hospitals are paid differently by Medicare and we know that there are issues like how bad debt and free care is booked by different hospitals in different ways, but I think the real statement that I wanna make is that to the extent that the board members feel like this is an important question, we need your help. I don't believe that we'll be before you next year with a reasonably accurate answer to this kind of question without the board's engagement in it. And so that's a direct request really. And again, we met with UVM last week, I appreciate it. Members of the hospital community have attempted, have worked at answering this question. So I'm not denying, meaning in any way to deny that or not recognize that. Next, just a brief statement about race equity. You probably noticed a pattern, I'm tending to ask a question about or we're asking questions about race equity at every opportunity we can. And again, I thought a level setting statement made sense here. We believe that every institution, including the hospitals, including the board, including the HCA is built on an environment that and culture that includes aspects of structural racism in its underpinnings. We may not agree exactly on how that shows up in our processes, but I hope we can all agree that that's part of the work we all have to engage in. You each hospital, we often look at different hospitals and say, well, you're huge and or while you're small in comparison to each other, but we also know that you are each central organizations in your communities, important employers, important institutions. So we're asking for this, we're really asking for engagement in this. We're gonna continue to look for various ways to approach it and ask for your partnership in figuring out ways to address the issues of race equity that I think shows up for all of us. Thank you, Mr. Chair. Thank you. So just a quick layout of today's agenda. First, we're gonna hear from Southwest Vermont Medical Center. The board will be allowed to ask questions as will the healthcare advocate. And as is true of every hospital budget hearing, the public will have a chance to comment. And so we will be calling on the public at the end of every single hearing that is conducted. So that will be your opportunity to offer any comments or perspective on the hearing that you just heard. So we're gonna get started. After Southwest Vermont, we will take a bio break. I know that several of you have already reminded me that that's an important part of the day. And we'll make sure that happens in between Southwestern Vermont and Brattleboro. So, Tom, if you could just identify which members of your team will be speaking this morning and I'll ask at Joanne, our court reporter to swear you win. Thank you, Kevin. And thank you for your comments. You said to kick off this meeting. So my name's Tom D. I'm the CEO of Southwestern Medical Center. And today we're gonna, I'll provide an overview and I'm gonna ask Dr. Trey Dobson, who's our chief medical officer to provide a brief summary of our COVID-19 response during last year and are playing going forward. And then Stephen Majetic, our chief financial officer, will do the lion's share of the 2022 budget presentation and we will be respectful of our time limits. Thank you so much, Tom. So Joanne, if you could swear in the three witnesses from Southwestern Vermont. Sure, would everyone raise their right hands, please? Do you swear the testimony you're about to give will be the truth, the whole truth and nothing but the truth will help you, God. Yes. Yes. I heard two voices. Trey, are you on? Sorry, I was on mute, yes. Thank you. Great, so Tom, whenever you're ready. Okay, well again, thank you, Kevin. And thank you for the board for your... Okay. If we could ask whoever is doing that to please mute themselves. If you're not speaking, everybody, it's a good policy to be on mute. And Tom, hopefully you can proceed. Okay, thank you again. And Steve will handle the slide presentation. So Steve, the next slide, please. And again, I won't go through this in any detail, but I just wanted to give the board a sense that as a small rural health system, we focus very much on our vision of the system, which we, you know, our vision statements, as I paraphrase, is really to be recognized as a preeminent small rural health system, known for exceptional care, convenience, safe and affordable care. And we take all those very much to heart and it's really part of our strategic initiatives. And as you look at some of these accomplishments during the last year, I think it kind of highlights our continued effort. And this comes from our board, to our leadership, to our medical staff, to each of our employees. That all of these are critical for our success and to be a community steward of our healthcare resources. And again, I'm not to hit all of these, but I do want to highlight a couple of key ones that we really actually were new in during the last 12 months. And the second one down there is a fact that the American Hospital Association named our hospital as their nationwide recipient of the Rural Hospital Leadership Award. And that really focuses on the efforts that our health system did in terms of working with our community partners, in terms of community health and our efforts of collaboration and creating community coalitions. And that's something that we think is a critical piece of our long-term success. And we take it very much to heart and we're very appreciative. And another recognition that we receive this year is from the Lone Institute. And Lone ranked our hospital four out of over 3,200 hospitals in the country for the value of care. And we received an A plus rating there, highest among Vermont's and New Hampshire hospitals. And again, as you look at the value of care, if you look at the value of care proposition, that's viewed from our perspective as quality over cost creates value. And again, this is something that we try very, very hard to create a value proposition for our community and for all Vermonters. So very important, I think, recognition for the work we're doing. Of course, we did receive our fifth magnet designation, which we're only one out of 28 out of the country, which was a tremendous accomplishment. And of course our workforce issues. And that was touched upon by Jeff as well as Kevin statements that workforce is such a critical challenge. And for us to be named one of the best places to work in Vermont seven straight years is critical. And we're doing a number of initiatives to try to tackle that challenging problem. So if you go to the next slide, Steve, and this is a summary of our strategic plan. And I showed this to you last year. I must admit the COVID pandemic had slowed some of the progress we had hoped to accomplish, but still we made significant accomplishments. One area that was slowed was to kind of complete our organizational increased integration strategy with Dartmouth, Hitchcock, both institutions had to focus its time and effort on its COVID-19 response. So that got slowed, but we're hoping that we'll pick up again in 2022 and we can get to that higher level of integration, which we're very much focused as a strategic imperative for our success. But we are pursuing numerous partnerships and the partnerships vary from institutional partnerships with the Dartmouth to service line partnerships, which we have done in terms of long-term care and some other initiatives to community partnerships from small organizations, small non-for-profits to bigger organizations as we try to continue to revitalize our Southwest region of the state, which has been certainly challenged over the least 12 years I've been at the health system. But there are some main areas, just very briefly, I will hit upon those. As you look at our advancing our clinical services, I think I guess I want to highlight there is that we view behavioral health as an area that needs a significant amount of intense increased focus and we had started doing that in the last year with a partnership with our United Counseling Services in a formation of what we call, it's an urgent care for adolescents or the PUT program, which was a pilot program and very successful and we're looking to build upon that. And we also developed a joint venture partnership in the long-term care area. And that's an area of vulnerability that our health system has had, the impacts our hospital and impacts our ability to create the appropriate continuum of care. We have I think a tremendous, very high quality system for long-term care, but we've been challenged financially. So we created an arrangement that allows a partner to come in and we consummated that transaction and that partnership is going to, I think help to help to make the financial operations of our long-term care entity stronger, which will have an impact on our health system and we're in our hospitals. So we're excited about that. Under our accelerating our operations and systems there, again, I think the key one there was the strength and financially long-term care services, but also to continue to work with Dartmouth-Hitchcock in terms of expanding our, what we call our group practice, which is Dartmouth-Hitchcock Putnam and has over 125 providers in that group. And that's a vehicle for us to deal with the medical challenges of shortages of both primary and specialty services. And we've made some great strides in the last year. If there's a silver lining to our COVID experience, it was that we've seen more physicians interested, more providers in coming to rural parts of the country. And so Dr. Dobson, who's our Chief Medical Officer, has led that initiative and I think we've seen progress. We're still challenged. Primary care is still one of our biggest challenges. We've made improvements, but we have more work to be done. And in the middle column, the pillar is our improving our infrastructure and we appreciate the help and the questions that the Green Mountain Care Board asks as we move forward with our modernization efforts. And certainly the one that we are kicking off in 2021 is a modernization of our emergency room and really our ambulatory services that supports the emergency room. That's a very critical project and one which you put us through some good set of questions and you tested us. And I think we're excited about breaking ground in that project this fall and move forward in terms of a service which has been very, very busy and especially during the COVID pandemic. And then another thing I just want to mention under the infrastructure is the workforce pipeline for physicians, providers and nurses. And we continue to try to innovate in that area and in our relationship with Castleton University has been tremendous. It has jumped started our effort to recruit and retain needed nurses. And just recently we became the first hospital in Vermont to have an approved residency program for nurses, for new nurses. And we think that will be another vehicle to allow us to recruit and retain the best and brightest nurses and to help meet our community needs. So we're excited about that. But as you'll hear from all the hospitals during these budget hearings is workforce issues are real and they are a current crisis that we're all dealing with. One other column I wanted to mention is our primary prevention and community development that continues to be one of our main strategic initiatives. And I really, I couple that to the columns the right, which is our population health and value-based care. And those two initiatives are something that we are spending a tremendous amount of time in terms of trying to create initiatives to help to enhance the overall health and wellbeing of our community members in the Southern Vermont region. We have hired or I should say promoted and created a new position here of Director of Population Health. That individual is plays a key role now in working with our community agencies. And we have formed a community coalition of over 20 organizations that we meet on a regular basis a couple of times a couple of times a month to do our planning together and to do our initiatives. And it's, I think it's going to long-term pay great benefits to our community. And we realize that we're more than just a hospital. We are a health system that has to focus on many aspects of care and that relates them both certainly issues such as food, nutrition, housing, employment. And we're trying to play a role in all of those. So we have our playful, our strategic plan drives how we budget. We certainly would encourage questions that ask us about how we're looking to allocate resources for these initiatives, but the plan drives the budgets and the budget really is our roadmap for success. And I think we've had some success and we certainly have further challenges to accomplish. And certainly one of our biggest challenges and I want to hand this over to Dr. Dobson now is in trying to do all these initiatives in the midst of a pandemic, which has been a tremendous taxing issue on our community as well as other communities in Vermont. I think we've done as well as others, but we know we're not out of the woods here. And I'd like to have Tray talk about our plans for the future. Great. Thanks, Tom. I mean, go ahead and advance the slide there, Steve. Thanks. Well, thank you so much, everyone. I know people are exhausted hearing about COVID. I have to wake up every morning, sort of reset and focus so that we can continue to address the situation. Early on in this pandemic, we were very fortunate just because of the team that we assembled to develop five priorities to stick with. And these are really what helped us sustain our effort. First was focusing on staff and patient safety. That was paramount because that helps people move forward and reduce their anxiety. We also recognize that over-communication and transparency was much preferred. In fact, if we were thinking about something, we didn't keep it within our leadership group. We discussed it quickly with staff. And sometimes that can lead to supposition to people having anxiety about the future, but it also built trust. And that is what was really important to make sure we were all moving in the same direction. As basic as this third bullet point sounds, I don't believe lots of organizations around the country focused on this and this is where they faltered. They were too busy making things very complicated without realizing that there are two things to do here, test people and vaccinate them. And everything else comes secondary. We also looked at data analytics. We built dashboards early. Our IT department jumped on this and it really did improve outcomes. We were able to monitor PPE very closely. We're able to look at who's coming in the emergency department and anticipate how many people would need to be admitted to the hospital. It really helped with forecasting and continues to do so today as we see this increase in testing needs. By the way, our testing, just like the rest of the state has gone up from just a couple dozen tests a few weeks ago, I think we had about 150 yesterday. That's a huge increase of several hundred percent. And then something that wasn't so expected and again, I'm very thankful that we're able to recognize this early is being a regional resource for the community. And by that, I mean the businesses, small and large, the school systems, the not-for-profits, even though the state did an excellent job and continues to do an excellent job in getting out information and having information available on the website, they cannot plan for every single question and all of these variables that come into play. And these local businesses have been real thankful and engaged as we try to help them with their situation. So the challenges and how we responded. Staff safety, of course, a big challenge. We really focused on PPE. You can see there, that's a little snapshot. It's a little too small to read in the right corner of the graphic, but it is showing our PPE management, which we review on a daily basis at our incident command. The green shows what we have good supply in. The red shows where we need to focus our attention. Then there's the workforce anxiety. And it's listening, it's understanding, it's responding. And it's truly acknowledging that this anxiety exists among all of us. It exists at different times. And how do we support each other through it rather than ignore it? There's the rapidly evolving guidelines and regulations and recommendations that all of us throughout society, not just in healthcare, have to deal with. And then as we've seen over the past six weeks, but what we've worked really hard to do is help our staff and our patients to understand these, to simplify them so that they're reliable and reproducible throughout our system. There is the increasing complexity and the need to standardize because standardization is what leads to reliability and complexity, of course, is the opposite of that. And then again, engaging all of these concerns from the community, frequently getting out and speaking with the community via social media, via television broadcast, radio, podcast we've been doing has helped the community ease some of their fears and understand where we are coming from. And again, that familiarity is what really breeds the trust that we need in healthcare right now when there's been some doubt among the population of trust in healthcare. Some of the things that we did is we did not close incident command. We kept incident command open for over 450 days even when the periods of time when the pandemic seemed to be waning or when our discussions were not so involved. We continued to do it and was very popular among our staff and it helped with communications and in fact, we've mirrored some of our processes moving forward non-COVID related based on what we learned by having an incident command structure in place for so long. Then also we had a hotline. This was thought to not be needed that much and it exploded early on and it continued to be used. At times we had between 75 and 100 calls on average per day. Of course, they wax and wane with the anxiety from the media and new developments in the pandemic. We developed something called a respiratory evaluation center, which was just the recognition and many places did this, but I was happy we were able to jump on this early and have the backing to do it. It a place for people to go rather than the emergency department or their doctor's office when they needed to be seen to figure out whether or not their symptoms were related to COVID. It helped the patient themselves and it also of course helped decrease transmission throughout the hospital and again, staff anxiety, patient anxiety were improved. We were one of the first in the country, I really believe that firmly because we did it so fast to develop drive-through testing. We got it going within 24 hours of the idea, formulating and we were able to do drive-through testing which we continue today. And then of course the vaccine clinic which I'll talk about a little bit more in detail, getting that together. With the drive-through testing, some of the keys were access. Access is so important. I think maybe even all of us on this call have needed to get testing or at least had a family member needed to get testing and the clinics doing the testing weren't open. Now early in the pandemic, that was understandable. There were supply issues, but now really there's no reason we shouldn't have wide access to testing. You can see the days of week we were open, there happened to be another resource in our area that the state runs, but we staffed that was open the opposite day, we were closed so we were good with that. We're doing in-house PCR which we're extremely fortunate to be able to do. We can get the results same day and then we text those results automatically to the patient which helps people get back to work faster, it helps them get back to school faster or if they're positive, it helps ensure that they are isolated. The vaccination clinic, the high capacity clinic, we were ready to do 750 to 1,000 people per day. We didn't quite get to those numbers. We had high capacity days of over 500. I do believe we had some Saturdays for educators and other specific populations where we were at that 750 level. Actually it's 1,500 according to that line right there. So some huge numbers going through the clinic and we're very proud that we have between 88, 91% of our healthcare workers vaccinated. That fluxes a little bit depending on which day you measure it and then over 99% of our physicians and advanced practice providers vaccinated. This regional resource need that I was talking about there's so many questions we started receiving earlier and rather than just pushing them towards the CDC website and the Department of Health, which we did do initially but they came right back and said we're not getting the answers we need. So we decided to be that focus point. There were a few places that we actually had written down relationships, agreements to help them, but most of them were just by Webex and phone and video conference to help them with all their questions they have and they still use us today. I think that again that has helped build the trust that is needed between regional healthcare center and the population and it's amazing the every day. I get a question that just does not follow any type of CDC guideline or Department of Health protocol because there are just too many variables in place and working to get the answer to them. It's actually rewarding but also again, it helps people get back to work quicker, it keeps them safer and it keeps our local economy running. And that may be it on slides. Oh, this is just a list of some of the many places that we either have formal or informal relationships with to help them with their questions. Finally, I'll just kind of shift gears a little bit real quick and just bring up recruiting. You can see a list here. I won't go through that list. I will say that primary care of course continues to be an area of focus. We have been very successful over the past year with primary care, three full-time physicians in family medicine and two part-time physicians in internal medicine in 2021, which is completely remarkable and so unfortunate that it is offset almost exactly by retirements in our area. So we look forward to continue to push that. We do have some unique recruiting and anesthesia. One of those full-time physicians there has been doing a pain, interventional pain medicine fellowship that's sorely needed in our area to help people get back to work suffering from back and extremity pain through interventional type of injections and typically they have to travel very far to get those and often they just don't do that. Now we're gonna be offering those locally. And I believe that's all and I'm happy to answer questions at the end of the presentations. Okay, now we move into the financial performance and the first slide here, you'll see that there's four columns I put in the 2019. I left out 2020 due to the pandemic and due to the high dependence, as Jeff mentioned, on the provider relief funds. You'll see our 2021 budget and then our 22 budget. A couple of comments before I move off this slide. Our 22 budget shows roughly a 2% operating margin, which is the operating gain. And we built this budget back and we were gonna call it a continued recovery budget but it seems like every budget projection that I've done since March of 2020, as soon as I issue it and send it out, something changes. So we'll talk, I'll talk a little bit about what we're seeing in our 22 assumptions that we made as we go through that have changed. If I did a budget today would probably change. Our 21 projection is better than budget. We budgeted a break even. We built that budget, I would say, very conservatively. We weren't sure with the behavior of the population, what the volumes are gonna be. And as you can see when you compare the 21 budget to the 21 projected, our net patient service revenue is up over $2.4 million. In the 21 projection, we have $2.8 million. In this projection, provider relief funds and we look to have an operating gain of about $4.9 million. One of the questions that the staff asked us a couple of weeks ago is our projection still good. And we believe that the projections will change. Couple of items, since we did the projections, we've seen greater volumes through our emergency room, through our express care that we didn't anticipate in the projection. We've also seen expenses go up due to the volume. And we also anticipate settlements to come in from one care Vermont. We've been working with them to try to get the settlement in there was no settlement recorded in the projection. So that amount could be close to a million dollars. And that's all on the shared savings programs with Medicaid, mostly Medicaid and maybe some Medicare. We're also working with our outside auditors to assure that we're properly classifying the use of the provider relief funds. The provider relief funds here in the projection when we did it was about $2.8 million. We had deferred 4.6 and we are working with our new auditors to assure that we probably account for that. And I do believe that $2.8 million will increase to $4.6 million. So our projection, some significant changes on the expenses while we have volume, we also have some expenses in order to address workforce that we will be incurring over the next several months. So overall, when you look at the budget, a 2% operating margin, we did beat our budget and the projections a lot driven by provider relief funds as well as increased volumes. A big item in the red, which probably is getting everybody's attention is the non-operating activities in the budget is a negative $49 million. That is an accounting transaction that needs to be done as we are in the process of terminating our defined benefit pension plan. The word termination doesn't mean it goes away. It's a term that's used basically what we're doing is we're 99.99% funded and each year the administration of that pension plan costs the health system over $500,000. So what we are doing is we are giving our employees options and we will buy annuities and we will get it out of the administration of pension plan, everybody will get their benefit. So it's not that we're terminating it and the benefit goes away. Everybody will get their benefits. So this is an accounting transaction that hits the statement of operations. There's also a corresponding and I can go on for hours on this pension accounting and I won't, but there's a corresponding entry that will hit the changes in net assets which does not hit the statement of operations for the 49 million. So it's a wash on the balance sheet. So our net patient service revenue request is to go up to our revenues at the time we did the budget to be 177.6 million dollars. We did not put any upside or downside risk related to the one care Vermont model. Basically, as I do each year, I budget the midpoint and I say no risk, no upside, no downside and we kind of come in at break even. Prior to the pandemic, we had a couple of years where we were in Medicaid, we were on the positive side. On Medicare, we were on the negative side but in the budget, it's basically a fee for service model with no upside or downside risk. The increase of 10.5 million dollars is an overall increase of 6.3%. That's before the COVID adjustment. And when we look at the FY22 budget and compared to the FY19 actual, the increase is about 2.77% a year. Why do I use 19 actual? 19 actual is the last non-pandemic year. When we built this budget in 22, we were keeping our fingers crossed and I guess it didn't work out that the pandemic would be behind us. But overall, the increase is 2.77% a year since our last non-pandemic year. When we look at the increase of our revenue, there's two components, one is volume. And again, this is budget to budget. Last year when we did our 21 budget, we were, I believe, very conservative in our volumes. And I know we stated that numerous times. We weren't sure on the behavior of the community. And as Kevin and everybody has talked about and every call I'm on is that a lot of people deferred care. And we're seeing that now in 21 and we anticipated somewhat of a ramp up in 22. The other piece is what we get paid, the rate price side. So each of those are roughly five plus million dollars for the 10 million plus increase in net patient service revenue. So when we look at the rate price, we're looking at a charge increase of 4.8% an overall charge increase that'll realize a $4 million or 2.4% of our net patient service revenue. We put an increase in for Medicare for the fee for service and in the fixed payment model that's about 1%, which is $576,000. Early returns on what's coming out of on the OPPS and IPPS is that that number may be a little light by a couple of hundred thousand dollars, but not significant. A risk factor in our budget is, we used our run rate and we saw, if you remember over the years, we have budgeted a shift to Medicare. And this year we did not budget that. We actually changed our payer mix slightly back to commercial because we had seen since October to April when we did the budget, we saw an increase in our commercial volumes. And so that was the best information we had at the time. So we budgeted a shift in our payer mix. Since we did our budget, as I said earlier, some of our assumptions have changed. In the months of June, July, and so far in August, we have seen a reversal of the shift to commercial to Medicare. And I'll talk about that more when I get to the risks and opportunities. Between the dish and the Medicaid, we put in about $41,000 and the net increase in bed debt and charity care on the rate side of the equation is about $400,000 for change in our rate and price of over $5 million or 3.7% of the 21 budgeted net patient service revenue. There's always a lot of talk. We always have a lot of questions on this. The charge increase of 4.8 will increase about 64% of our charges. We, through all the comparative studies looking at, we do it each year and this year, we've done it more with the price transparency. We're going to increase about 64% of our charges. Again, our physician practice charges are not going to be increased. Rehabilitation services will not be increased. That's PTSD, OT services. And then there's select others. We have a couple of charges in our radiology department that we are not increasing because we're a little higher than some and a couple other areas in the OR and other places. And in the ED, this couple selected others that we're not going to increase. Drugs and medicine supplies is no cross the board increase and the $4 million is roughly 2.4% of the total budget for the hospital. The other items, Medicare, shift to commercial or budget assumptions, Medicaid. And as you can see, that's about a million dollars combined with the $4 million, that's $5 million in rate. On volumes, we are budgeting less inpatient volumes and that was based upon at the time we did the budget. We saw our 21 budget assumption was higher than we were trending. We've seen some recent turns on that. The emergency room was another area where we did, we saw lower volumes and we budgeted lower volumes. Recently, we've seen increases. Outpatient surgical services, we've seen an increase there, an endoscopy, mostly in orthopedics and so in the surgical services. So there's a significant increase in our volume there. Medical group volumes, we're making an assumption, but there's risk there with the pandemic coming back and the COVID related volumes. And that's due to testing of $900,000 we included and all the other services. So when you add up to change in volumes and services, we're almost $5.4 million. And that's comparing budget to budget. And I'm gonna say this numerous times, we were very conservative in our volumes last year and I was hoping that we'd get back to and sometimes I don't like when I say this, I was hoping we get back to somewhat normalcy pre-pandemic levels and we could figure out what's going on, but this is again against budget to budget last year and our budget was very conservative in volumes. Our fixed perspective payment revenues are roughly $42 million. You can see the breakout. And we always reserve the right to withdraw if the corridors and the respective risk corridors are not acceptable. We do not anticipate that happening. We believe I've been in contact with OneCare Vermont and we believe the corridors are acceptable to our board. So just to recap, revenue is going up 10.5. Rate increases are approximately 3%. Volume increases 2%. Three year run rate is almost 2.8%. I think the previous slide's a 277. Charge master increase will go up about 4.8%. Volumes that we've all talked about here over last year's budgeted levels and we still, the 22 volumes that we're projecting are still subject to behavior changes due to the pandemic. Okay, so we're back to the statement of operations. And as you can see, again, I want to stress we're a 2% operating margin. Our projections will probably come in a little better mainly driven by the provider relief funds and some positive net patient service revenue. From a cash flow perspective, here's a high level cash flow schedule for FY22. As you can see is our operating gain. We'll have some non-operating gain depreciation expense. Really what comes, the bulk of the schedule is really down here. We're going to have a routine capital budget of about $6 million. We're anticipated in FY22 to spend about $6.4 million of the over $25 million approved for the ED project. Our foundation, which has been fundraising, will do the equity contribution of $7.7 million. We will be repaying about $7.2 million of Medicare advances that have to be repaid without interest charges by next August. And our regular debt is at roughly $250,000. I put in the differences here between the FY21 budgeted cash flows to the 21 projected. As you can see, it's down here's a little different. We anticipated last year that we're gonna have to go into a line of credit for $10 million and that we were going to in 21 have to repay $8.5 million of the advances that didn't happen. We're only gonna be paying approximately $2.8 million. We had advances of nearly $10 million. So that's the big change. And also in order to get to that 100% funded on the pension plan, we're putting $6 million in this year. We had budgeted $3 million, but to save over $500,000 with administrative costs, it's well worth it. And so overall, so that's the comparative to what we projected or what we budgeted last year. A couple of other things. The operating gain, as we talked about, the projection will probably go a little higher. The $4.6 million is related to the deferred COVID related. We had deferred some of our provider relief funds and the capital spend, you can see. Pension funding as I talked about and the guidance, we thought we were gonna have to repay the advances much quicker than the government's requesting. And so we're anticipating $2.8 this year instead of the $8.5 as we spoke about. The modernization project, again, just to repeat myself, the CON had 7.7 and the ED project spend. So when we look at our indicators, you can see where we've been relatively, our operating margin's been, we target a 3% operating margin. And as you can see, we've been close to that, our 22 budget, we budgeted 2%. We thought this was gonna be continuing recovery budget. Hopefully we can get through this increase in the pandemic and we get back to somewhat pre-pandemic levels. But one of the things we're very proud of, SVMC is lower when we compare to a lot of from a lot of PPS hospitals, Tom talked about the value equation, high quality, low cost. There's no downside risk, Medicare downside risk in 20 or 21 due to the pandemic. And also in 22, we did not budget for any of that. So just an added slide, you can see here, the actual, the black solid line is our operating margins since fiscal year 12, this is 10 years. You can see our budget, you know, we budget, you know, pre-pandemic, we were budgeting close to that 3% a year. We believe 3% is what we need to reinvest in ourselves. In 19, we clicked up a little bit on the budget and we over-performed. That was some one-time transactions with new coming in. And you can see in the 21 budget, we were almost at 0%, we believe will come in. Most likely will end up, this spot here will probably come up. And you can see the trend line, the trend line's basic. It's a slight decline, but basically flat. Our operating indicators, days cash on hand in Southwestern Vermont, relatively consistent. This was up due to the provider relief funds. And we always disclose the parent days cash on hand, and we will peak right now, and then as we go through and pay some of those provider relief funds down, we will drop our days cash on hand. Also investment returns have been positive in the days cash on hand. Days in the accounts receivable continues to be below the Vermont average. And our days and counts payable close to the Vermont average. Also some of this drop here will be caused by the $7.7 million funding of the modernization project from the foundation. The parent does hold the foundation's cash as well. Debt service coverage ratio is strong. Long-term debt capitalization is positive and average age of plant is unfavorable as we've talked about. And this drop from the long-term debt capitalization is partly due to the eliminating the pension liability on the balance sheet. So when we look at, when we take a step back now, we've talked about revenues, we've talked about operating performance, talked about balance sheet indicators. The operating expenses will be going up about $6.3 million. People cost in our budget are over nearly 60% of our total. We have salaries and wages, benefit-related cost, and then our providers through our partnership with Dartmouth and the PSA, the professional services agreement. That's where all our providers come in, is 34 million, our total is 105 million of our total spend of 180 million on people. Points of interest, we're putting a 3% base increase in FY22. We are currently looking at that. That may need to change due to the workforce issues that we are all feeling in the state in order to keep people and recruit people. And we may need to make some changes to that. The FY FTEs are greater because we've added some, the blueprint FTEs in the community, they're reimbursed via a grant. We've increased FTEs in clinical areas due to some staffing concerns and what we've been fortunate. Our chief nursing officer has done an excellent job along with the HR department. Currently, we have no contract labor budgeted and we have no contract labor in-house at this time. So we are keeping, that's another one of those fingers crossed. Employee benefits are due to increase over budget, $7.4 million. Our actuary gave us a claim projections, claims are gonna go up 7%. We saw a dip during the pandemic of our employees using their benefits and they've now started to use them. I think we're seeing it in the hospital as well, that people are deferred care. We have workers compensation, we've seen an increase there and all the other regulatory benefits will increase. And the Dartmouth PSA is increasing 5.8%, mainly in, we've had a successful year in recruiting physicians and associate providers. Operating expenses, non-salary, we put only in a 2% inflation factor. That was, remember this budget was built in May. We weren't feeling the effects of inflation that is a risk to us. Drug costs due to increase 2.3% because we've budgeted lower volumes in some of our high cost services, mainly in the cancer center. Inflationary increase for drugs is 5%. Provider tax goes up as revenue goes up and depreciation and interest increase due to, we may use the interim line of credit, we may not and possibly to repay some of the advances. If operations continues as is, we won't have to do it but we put a little bit of extra interest expense in the budget just in case. A lot of numbers on this page, I'll just touch on a couple of highlights in the budget. You'll see that our total assets will go from the 930, 2020 of 96 million down to 94 million. That's not a negative. It's mainly driven by the cash and cash equivalents that we were carrying out to pay the advances down. What you will see is that there'll be a big decrease in liabilities when you look at the other, we had 12 million nine down as of 930, 2020 and it'll be down to four million dollars. That's mainly due to the elimination of the pension liability on the hospitals balance sheet. There were no service line adjustments by definition in FY 21 or in 22's budget. Trey and his team, we did fill an endocrinologist and a neurologist this year and we are recruiting for another neurologist because as soon as we got a neurologist on staff and endocrinologist, they filled up, showed the need in the community and Trey and his team is actively recruiting for additional providers as the wait times are just too long for our community. Risk and opportunities. This is probably the biggest risk to Southwestern Vermont Medical Center. Our 340B program eligibility. The impact in FY 22 is 2.7 million dollars. This is significant. In order to be a 340B hospital, Southwestern is as a sole community and rural referral center. We must maintain it. This proportion is share percentage of 8%. At the bottom of the schedule, you will see our percentage is 11.992, 8% and our interim FY 21 when this slide was done was 5.5%. It's down to 5.1%. When we file our Medicare cost report in February, we most likely will not qualify for 340B effective approximately April 1st. That will take out 2.7 million dollars. Annually we have about 5.5 million dollars worth of benefit in this program. Currently there's a bill in the House and the Senate that is working its way through that. I'm just gonna put it simply that will not use pandemic year this percentage calculations for eligibility in the 340B program. That when we look at the changes between 19 and 20, and if we take out the high inpatient cases for COVID, our percentage would have went up. When we look at 21, when we take the COVID related Medicare patients and other patients out the high length of stay, it doesn't get us there. And one of the things that is also contributing to this is the excellent work of the blueprint and other providers in the community to keep Medicaid patients out of the hospital for unnecessary care or hopefully keeping them well in the community. So we're working on initiatives. Currently we did not budget this. This is our biggest risk. We'll be working on plans to deal with this if the legislation doesn't move through. Tom, would you like to add anything to the 340B eligibility slide? Not hearing anything? I'll move on. Patient volumes, what will happen post pandemic? As you can see our volumes, you see the 21 projected was at 24 when we did this projection at 2400. Our budget was more than that. Our FY22 budget is more. Will the budget numbers hold our recent trends? We probably would budget a little more if we did the budget today for 22. But that's not the case. So we see that will be less than 19 but more than what we budgeted last year. So we have an upside. If we get back up, we have an opportunity for about a million two. If we go back to the 21 levels or the 20 levels, we also have a risk in the budget of $1.2 million. Nice round number. Yes, go ahead Tom. I apologize if I was in trouble with my mute button. Just one comment. We are meeting today down here in Bennington with Senator Patrick Leahy. He's coming to our hospital. And this is a central piece of our discussion with him is with this 340B issue for our world, for it doesn't affect all hospitals across the country. There's probably about between two to 400 of them that are impacted and we want Henry clearly aware of the impact he would have to our institution, which is significant. Thank you. Okay, our medical group, we've recruited and we filled a lot of vacancies, but as Trey said, we've had some retirements. And so we, based upon the three year pre-pandemic trend, if we don't hit our targets, we have risked about 700,000. But with the increase FTEs, we think we can, we may be able to exceed as patients start being seen the endocrinologist and neurologist and their budgeted here, but we're hoping that we can open up additional access. The medical group in the hospital represents about 16% of our net patient service revenue. And we're also in the process of instituting a new compensation model to move away from just total volume and moving to volume, quality indicators, and our providers are very engaged to date. Emergency room volumes, we've seen a recent upclick in them. I don't want to say we're back to normal, but we're summer months have always been busy here at Southwestern Vermont in the ED and we're hitting the historical numbers. As you can see, 2020 was took a big dip. We budgeted less when we did the projection. We built our budget. We were at 19-4, which was a significant drop, but we've seen some of that volume come back. So the FY22 budget, we had it at 20,007 looking to get back. So we have an opportunity, if we get back all the way back to the pre-pandemic, we have an opportunity of zero to $2.7 million, depending on how far we come back. Same revenues. Commercial volumes, as I said earlier, we're seeing a shift away from this assumption. For every 1%, it's a loss of $600,000. There has been some discussion in the community that a lot of younger people have moved into the market, but we're not seeing that in our payment shift. And so for every 1%, it's at least $600,000. It could be even more. We're seeing, in the midst of the pandemic, we're now also, and we're seeing all the volume starting to come back, we're seeing increased denials and third-party payer audits. And we budgeted a slight amount in there, but there could be risk between $250,000 and $500,000. And this is denial, pre-authorization denials. This is denials on retroactive audit claims they go through when they say, we're not gonna pay for this. And we battled with, last year, we probably had initial takebacks of nearly a million dollars and through discussions, providing additional documentation, discussions with providers, we were able to overturn about half of them, but we're seeing an increase, denials and third-party payer retroactive on services that are already rendered. So there is a significant risk to our budget this year. So we talked about volume since budget completion, ED inpatient, express care is up, cancer center volume is down, Medicare, we budgeted 51% and July, the payer mix for Medicare was 55%. So you can see a big jump since we completed the budget. Other risks, the top of the list is COVID, other regulatory rate increases, Medicare, IPPS have not been totally approved, retention of providers, we believe there's a lot of opportunity there, but there are members of the medical staff that are aging and could retire and create some voids, the volumes and payer mix and the political climate. And I can go on talking about risks and opportunities probably for another half hour. Capital spend will be 6 million, we'll spend 6-4 on the emergency room in 22, then 23 and 24, we'll complete it. Here's the ED project was 25-8, Act 250, we're waiting for Act 250 to approve the start to the project, we're anticipating getting that shortly. We'll be submitting a CON for a cancer center and then we have some imaging services upgrade, CT, MRI and possibly a family medicine residency and health center. So that's the end of the detailed presentation. Thank you, Steve, very much. And as always, the team from Southwestern, Vermont has done a great job of presenting the information to us. And as we did last year, I'm going to go in alphabetical order with the board members and rotate that alphabetical order. So for this hearing, Jessica will start, but for the next one, it will be Robin and so on and so forth. So with that, I'm going to turn it over to Jessica Holmes for questions. Great, okay. Well, thank you very, very much. Really helpful presentation. And again, as we said last year, thank you for all the hard work, the hospital has done in the midst of this pandemic. Obviously we really count on you all and we appreciate how you came through and all the innovations that you undertook. So Steve, let me, I'm trying to take copious notes here as you were going through your presentation because I'm trying to understand where we are now. And I know it's really hard to figure out based on what you submitted in July with where you are now in this world that's changing. So I totally appreciate that this is like constantly moving targets. But I'm just wondering, there seems to be a lot of movement in the projections for first of all, 2021, in terms of the 169 potentially having greater volumes on ED, greater volumes on inpatient, things like that. So I'm just wondering, is there, do you have in your internal calculations a new operating margin and total margin estimate to where you think as of now you're going to end 2021? So I was working on that last night, figuring I get that question and it's the first question I get. So the net patient service revenues probably will end up at 170.15 or so. Okay. The COVID-19 funding and I have new auditors and we had a discussion about this. The recognition of the provider relief funds will go up most likely. 0.5, instead of the... Instead of the 2.8, that will go up. But keep in mind that those provider relief funds, I have to justify and either through, we purchased and we built and we negative pressure in rooms and ED. So we spent those items on capital this year and we spent them on the COVID vaccine clinic testing. So all of that is built in. So I really like, I would really like if the accountants would allow me just to take the provider relief funds off the table, okay? Especially the capital portion, but the new auditors and we're having discussions with them about the recognition of that. Other revenues most likely will be lower due to just a couple of small things, not that much lower, but lower. Mainly in the 340B arena, because there's less manufacturers and just drugs that go through that program now because they're all pulling that down. And then the operating expenses will likely go up for a couple of reasons. One is we will be providing some additional compensation to address the need to recruit. And we have a couple of programs that we're putting in place to also address that. Also, we have started, now the state is funding part of it, but we have a COVID resource center that we remobilized and Trey talked about it a little bit up at the college. We now moved our COVID testing and vaccine clinic back up there due to the volumes. So that is gonna create a drain on services. And so at the end of the day, the operating gain probably will be closer to $6 million. And mainly the driver there is going to be the provider relief funds and some of the additional volumes that we have seen. But now. Okay, sorry, in the total margin. So up in terms of a margin, both for both operating and total, what does that get you? So that's $6 million would be $6 million. $6 million will probably get us to, let me do it real quick since I'm able to do it. It'll get us to about a 3.3, 3.5% operating margin. With of that operating margins, call it, what about 2% of that being driven by the provider relief funds? Okay. Okay, so if you back out the provider relief funds, we would probably be at one, call it one, one and a half. Okay. So then let me actually just jump in to the projections for 2022. Obviously, as the world is changing, this is obviously still gonna be uncertain. But I'm actually wondering, if you go to that summary of the NPSR request where you start with a 21 budget at $167 million, and then you break down both the price and the volume components of that to get to the $177 million. This is what I wanna talk a little bit about. And I recognize budget to budget is problematic for lots of reasons, but since that's where we're starting from, I was trying to listen to your quick calculations there around what the impact could be if you were to update your budget request now for the potential increases in ED volume, potential increases in inpatient volume. If they had returned to the 2019 levels. So am I right that your volume, where you had a $2 million budget to budget decline in inpatient volumes and a $1 million budget to budget decline in ED volume. Can you just speak again to what that would be if you returned to the 2019 volumes? What would be the high end on the volume component of your budget to budget calculation? Well, on the volume side, I would say if we got back to 2019, close to that $2 million, $0.55 million would probably go away. The emergency room volumes coming back up, the million dollars would go away, the negative. But we gotta keep one thing in mind though, Jessica, is that we've budgeted our ED for lower volumes. So I'm gonna have to then increase staff. Oh, no, I understand that there's gonna be operating expenses that are gonna come with it. I'm just trying to figure out what is the NPR increase potentially if the volumes that you're starting to see coming back actually continue, right? So that $3 million would be up higher, $3 million in NPR, right? I think that's a safe assumption at this point. Okay. Like I, you know, doing this over 30 years doing budgets, I haven't had one projection since March of 2020 that has come in, okay? And as soon as I think the glass is half full, I go back to the half empty and vice versa, and vice versa. So we're still in this movement. I understand that, I'm just, I'm trying to figure out what's the updated projections for next year, given what you're seeing now. So, you know, what would it look like? I also noticed that the providers that you're recruiting for weren't factored into the budget, so. Well, our assumption for providers is that if we had a signed agreement, okay, in when we did the budget. Now some of these providers and Trey may, you know, if I don't get this right, Trey, tell me, it's not like when we hire a nurse that they give four weeks notice at their hospital and then they come here. Some of these providers won't come for several months, if not even a year. Am I correct, Trey? Yeah, it's, in fact, it's the time's increased. So we used to say at the short term 120 days, but now short term's 180 days and it's more like nine months to a year. So, Jessica, the ones that we budgeted as increases and increase their volumes are ones that we had signed agreements with and we know their start date, okay? If Trey hits a home run and every one of those that he's recruiting for signs today, the likelihood of them joining us wouldn't be till mid-year or even next summer in some cases. So, you know, that's just to put any volume on them, okay? We didn't put any cost on them either. So to put any volume on them would be, would add significant risk to the budget. Okay, that's helpful. On the price side, there was a reference in the narrative that management removed enhanced reimbursements for COVID-19 Medicare patients. And I'm wondering if somebody could talk a little bit about that and whether that's still an appropriate option. So when we prepared the budget, we took out the extra 20% that we were getting on COVID in patients. So we took out the enhanced reimbursement on those cases. That's, you know, is that gonna continue? Well, I think it will now, okay? Sitting here in August. When we built the revenue budget, which was early May, you know, maybe we were a little too optimistic, but we were thinking that at some point, the public health emergency would be off and the COVID patient enhanced reimbursement would go away. Yeah, first you had the fright, but given what we're seeing with Delta and, you know, what we're hearing, I'm just wondering what impact does that price piece have on your projections now? Well, it probably would be, you know, let's call it a half a million dollars. Okay, and that might be high. Okay, I'm just trying to get a sense of the, yeah. And then there was another mention, you know, you mentioned there was a 1% increase for Medicare, but in the narrative, they're talked about a possibility of a four to 5% increase for fixed perspective payment from one care Vermont. So I'm wondering that was back from the narrative. Is the 1% assumptions still accurate or is it closer? Is there, you know, can you talk a little bit more about the four to 5%? Well, I was on a call with one care earlier in May where there was not Medicare. There was a discussion about Medicare saying that in models such as one care that there could be upwards to 5% increase. Okay, I put it in there to put a little pressure on everybody to say, hey, listen, you know, we gotta go for everything we can get. But that was pie in the sky stuff. Okay, that was just to raise the factor that currently I'm not sure we're capitalizing and I'm not sure who's responsible on all of the opportunities. I think it's a combination between one care, the Vermont care board and the federal government and the negotiations of the plan that we need to get every dime we can get out of the Medicare program. Because the FIFA service program is only 1. something percent when you look at all the ins and outs of it. And on the outpatient side, I haven't thoroughly studied it yet. But so if we can get to hypothetically a 4% increase through the one care model, okay, that would help, okay, but we haven't been getting that over the years. So, and then that comes into the assumption where I budget, I always budget the FIFA service, which is the middle of the road. Okay, I don't budget upside or downside. Okay, so that would help that assumption. God, okay, that's helpful. Why don't you know what that was referencing and what you meant by that? Yeah. So let me just ask a couple more questions actually on volume and maybe this is for Dr. Dobson, you know, so I've, we've highlighted areas where volume might be even higher than anticipated in the coming budget. But I also wanna just reference last week, Mathematica came in and they provided us with a hospital by hospital analysis of preventable utilization in focusing only on the Medicare fee for service population. And the analysis estimated that about 30% of Southwest inpatient and ED Medicare fee for service revenue is potentially avoidable. So I absolutely believe all of your team when you talk about, you know, the emphasis on population health, you're one of the hospitals that are leading in payment reform efforts. But if the analysis is right, then the current business model is relying on a significant amount of revenue that's coming from avoidable utilization. So how should we as board members think about the volume request, the NPR request in light of the possibility that, you know, some of this volume, a lot of this volume is potentially avoidable. So how do we think about that? Well, of course I haven't seen the report, Jessica. I have seen many reports. And, you know, I don't wanna be crass here, but if you can show me the patients that don't need to be admitted to the hospital, I'm happy not to admit them to the hospital. Unfortunately, that's not how efficiencies are gained. It's over time and it's over regional practice in order to create that standard process. Look, we don't have the resources or time or nursing staff to admit patients to the hospital that don't need to be admitted to the hospital. And I think you're gonna hear that echoed everywhere. There are patients that wind up in our hospital that could be in a skilled nursing facility. Unfortunately, we can't get them there. I probably, that's probably the biggest area that could be improved. But, you know, I know there are stories and there are places in the country where patients come in and get admitted. But, you know, just using ICD-10 codes to decide who should come into the hospital. It's almost difficult to hear as a physician or a nurse taking care of these patients that they don't need to be there. No, I think that's not what the analysis actually showed. I mean, the analysis showed that many of the patients need to be in there at the time that they're admitted. But the question is, could the care have been delivered earlier in a different setting that would have prevented that admission, right? So, you know, the diabetic that's having an episode needs to be seen absolutely right away, although it had that diabetes been managed earlier in the, you know, might not have ended up there. So it's not, it's not a metric that's suggesting that the patients that are admitted, you know, shouldn't be admitted at that time. It's really thinking about the population health and the preventive care that could be happening in the community that could reduce those admissions. So I don't wanna mischaracterize the analysis and I'm happy to share it with you. But I just wanted to have that conversation as you all are leaders in thinking about population health and relationships with community partners in reducing these types of admissions. We're still seeing, at least by this estimate in the Medicare population, significant portion of revenue on that. So I wanted to hear your thinking going forward. What do we do about it? How do we think about it? So I think it goes back to Tom's initial slide there that had those pillars that unfortunately we really were making some great progress and COVID did push some of those back. But there's many examples. I'm sure one of them could be, for example, wound care. So when an office or an organization tries to do wound care for diabetes and other chronic illness, it typically is a loss, revenue-wise, but it's a gain system-wise. And so it's making those types of investments, doing wound care in a way that says we're doing this, we're putting money in now, but it's gonna save money in the end. As far as the answer to that, I think everyone fortunately in this part of the country is wanting to do this, willing to do this, and we are moving forward, and we'll just have to keep at it. And work together as hospitals, not in a competitive way, which we don't, but work together among all the hospitals and in meeting on that. Go ahead, Tom. Yeah, Jessica, a real-life example. Working on it right now, and hopefully we go up to the state within the next month with our presentation, but we have three, four, five, six adolescent kids sometimes being held in our ED because there's nowhere to put them to go to make a presentation to create an intensive outpatient center in partnership with UCS that we're gonna hopefully divert those kids through that center outside of the hospital and have care provided from eight o'clock to four o'clock every day for a period of time. I think that's gonna be an alternative, which would be much cheaper and better outcomes, better care for the children. That's just one example. A number of things we're working on right now. Yeah, no, that's helpful, and that's fantastic. You're all very innovative in these ways. So I wanna talk a little bit about the inflation worksheet that you all submitted. And this is a part of an appendix. It wasn't presented here, but it is in an appendix. And it looked like in that breakdown, there was a 3% wage increase for non-medical staff. It looked like there were no raises for medical staff. And that non-medical staff was about 30% of the operating expenses. As you mentioned, there was 5% for drug price increases, which is a pretty small part of the budget, about 8% of the budget, but a significant price inflation there. And about, as you mentioned, 2% for supplies and some for employee benefits going up. So overall, with the weighting, I suggest about a 1.5% inflationary factor. And you're asking for a 4.8% change in charge. So a point and a half of that is explained by inflation. How would you think about the breakdown of the rest of that 4.8% change in charge? 1.5% explained by inflation. So, again, we're doing budget to budget comparisons. Okay, last year's budget was we squeezed that budget a lot. Okay, and also, we've added some resources. We have a respiratory evaluation unit that is in our budget. We've added 17 FTEs, a portion of them are blueprint, but a portion of them are not. We've also added some other measures. We have greeters in the front of the building for COVID. And we have a lot of other COVID protocols that we now are doing. Okay, and I think we'll become part of the way we do business moving forward. So, just like we talked about volume, we have additional volumes and additional costs being incurred that is not inflationary. So, and that, we believe we have a significant risk when it comes to inflation this year. Today, when we did the budget, we were just trying to squeeze everything and we said, we'll take that risk on. Okay, but it's getting, if inflation ends up coming in it, and the economists, they go, on Monday, they say it's going up 5%, 6%. On Tuesday, they say it's going up 3%. They say it's coming back. Well, we'll say, but right now, we have more volume, more things we're doing. Okay, well, one of the ways I think about the change in charge is it's got to cover inflation, right? So it's 1.5 or possibly higher than that. It's probably got to cover a cost shift because the public payers are not increasing the reimbursements at the same rate as inflation. And then it's got to cover a contribution to margin or it's got to cover somewhat of a margin. So I'm trying to ask you, I guess, in some sense to think about that 4.8%. We've got 1.5% explained by inflation. Is there a component of that that's reflecting the cost shift? We actually have, one of the statutory mandates is that we have to consider the extent to which costs incurred by the hospital and connection with services provided to Medicaid beneficiaries are actually being charged to non-Medicaid beneficiaries. So effectively to quantify the cost shift. So I'm trying to figure out how you might think about that with that. Jessica, so here's how I look at that. The charge increase of 4.8% is a charge increase. I don't get paid for that. The increase, the impact of the charge increase is 2.4% in that patient service revenue. Okay, it's about half of the actual charge increase. So, that closes that gap down quite a bit. Okay. So, you know. Infective rate increase is really 2.4. Yes, yes. On that patient service revenue. Yeah. Because remember, if you look at our business, 50, in July, 55% of our charges are Medicare. Medicare doesn't care about my charges. Okay. You know, when I did the budget, Medicare was only 51%. So all of a sudden now that charge increase of 4.8%, the 4,033 that we calculated is going to be less moving forward if Medicare, if we flip back to where we were going with more Medicare. So that 4.8, you know, if I did the budget today and let's say the volume stayed the same, that charge increase I'd be asking for maybe 5.5, okay? Because I now have more Medicare coming in what I know today than what I knew back when we did the budget in last week in May and June. And we held off, I held off as long as I could to get the best information to finalize the budget. There was a lot of moving parts. Okay. So just an interjection from the presiding officer that we have allocated so much time to each of these hearings. It's clear we're gonna go over time on this one. The hospital SVMC did a good job of staying within their time limits. Yeah, okay. I'm done, Kevin. So that's my last question, thank you for the song. Robin Lunge. Thank you. It's nice to see you both. Thank you for your presentation today. I just had a couple of questions to make sure that I'm understanding the staffing dynamics a little better. So you've mentioned a couple of times that some of the FTEs, the 17 FTEs is related to the blueprint. And what I was curious about are these new blueprint FTEs, are they shifting from another organization into SVMC? Could you just give me a little more information about those? So those FTEs are community workers that is reimbursed and it's reimbursed in other operating revenues. And I believe it's, Jim Rui, you're on the call, correct? Do you know that exact number of blueprint FTEs that were transferred in? We actually transferred in those FTEs a year ago from another organization. And then there's an additional, I wanna say there's an additional eight. Jim, do you have that number? Before Jim answers, if the court reporter could swear Jim in. Okay, sorry. Okay, please raise your right hand. Do you swear the testimony you're about to give will be the truth, the whole truth, and nothing but the truth so help you God. I do. Thank you. Okay, so Steve, the question is on the blueprint. The increase in FTEs, just Robin, can we, Jim will look it up as that's the nice thing about TTEs. That's fine. Yeah, that's easiest, that's fine. But it sounds like it's existing people that you're just shifting, there's being shifted into FBMC from other community organizations. Yes, yes. Okay, great. I believe the number's eight, but Jim will get you the number. Perfect. Great, thank you. And then you, when you were talking about some of the other FTEs increasing them in clinical areas due to staffing concerns, is that burnout related, retirement related? I was just curious about what some of the whys. All the above. Okay, yeah. You know, and we also haven't, you know, we're having a difficult time in like radiology as an example. We have people working overtime because we can't recruit positions. So we budget, we budget the full time position, but it's vacant. And so, you know, we're gonna run a little over time, we're gonna flex shifts and things like that. So. Great, thank you. That actually was my only question. Thank you. I'll catch us up on some time, Kevin. Thank you so much, Robin. Next, I'm gonna turn to Tom Pellum. Tom. Well, again, thank you for a great presentation. I will be reasonably brief here. I have one kind of a quick question for Steve. Did I see him lean forward to his desk to answer one of Jess's questions and then hear an old tape calculator? Yes, yes. Yes, yes. Unbelievable. Okay, how's that? How's that? Unbelievable. Well, it reminds me of working with Jim Reardon who unfortunately is passed away, but he was a state's finance commissioner after I left. And in all the years I worked with him, I never knew that he didn't know how to use back then. It was a Lotus or whatever the spreadsheet was that we were using. He didn't know how to do it. And then finally I learned that actually I have to say, it just gives me comfort that that's what you're using because it's a much more directing engagement. So I don't have a lot here. I wanna kind of quickly go through and make an observation that I went back and took the income statement and just trended it everything from 2019 actuals through 2022 budget just to kind of see what the context was for your presentation this year because your numbers are a little elevated relative to past years. And so on your NPR FPP, the trend over that period is inclusive of 2022B is I calculated at 2.53% which is well within the margins that we talk about. Your operating expenses, similarly, even though you're looking for 4.8% 2022B over 2021P, the trend here over those few years is 2.76%. And your operating margins are very healthy and but for the pension issue, you'd be in the 2% range. So I'm just feeling comfortable that the context here is a very good one. All of your requests, approved requests for charges, even though it's 4.8% this year, your prior one was 3% in 2019, 2.8% in 2020 and 3.5% in 2021 all below the weighted average for all the hospitals in Vermont. So that just gives basic some comfort. One area that I saw some concern is that then if you go to payer mix and trend payer mix by payer type from 2019 through 2022 budget, Medicare trends forward trends over that period at 1.5% growth rate, Medicaid at a negative 1.03% growth rate and commercial at a 5.41% growth rate. So I'm just wondering if that is a concern of you that the long-term trends here are that the public payers are, you know, that the cost shift is getting worse, that the public payers are down in the 1% or less range as a trended growth rate and it all falls to the commercial payers. Well, Tom, you know, if you're using the 22 budget as your endpoint on the commercials, we did increase the number of commercial cases in our budget, which we're now seeing may have been a bad assumption. So yeah, there was upwards in commercial volume and which would then drive commercial net patient service revenue up in the 22 budget. But if I have to do it all over again where I was sitting in May, I probably would have not budgeted that. Okay, but everything I was seeing at the time in my staff, we were seeing more commercial and we were like, okay, you know, I said at one of our leadership meetings just a couple of weeks ago, I think the Medicare patients are now coming to get their care and they were slower, even though they were vaccinated earlier, they were slower to come back and get their care and the commercials patients came back sooner. Okay, and so we, you know, probably not a great assumption, you know, looking back, but that's what budgets are, you know, and we probably should have rolled that back a little bit. It would have put an additional burden on the overall budget. But, you know, like I said earlier, and I'll say it again, every time I put something on paper, it seems like it changes tomorrow. Yeah, been there done that. That's why I kind of went back to the 2019 trend to 22 because it's just a longer period of time. So in your narrative, I'll just read you the sentence, you don't need to go to the page, but it's on page nine dash 17 and the sentence is additionally, insurance plans are requiring patients to go to specialty pharmacies to obtain their pharmaceuticals which reduces CVMC's 340B program benefits and net present service revenue. And I'm just wondering, so is that, should I read into this that insurance plans means Blue Cross Blue Shield, MVP and SIGNA? Yes, to all three, UnitedHealthcare. You know, those are our biggest MVP Blue Cross, UnitedHealthcare, Aetna, SIGNA are our biggest payers. And so as an example of what that sentence was, they are now making patients go get the drugs, okay, and have them, and the patient literally doesn't bring them in. They ship them to us, okay, and then we administer them. So all we do is get the administration fee on those drugs. We don't get the revenue and we don't incur the expense. Okay, and I guess that would be a similar question for one of your answers, I think, to Jess. I lost my note here. I lost my note here. Well, so going back to last year's presentation, you presented that down in the center of Bennington at Putnam Square, that there was a redevelopment project going there that you were going to put in and emerge a, kind of a satellite of a hospital into that project. Is that still on track? You know, Tom, it's the second phase of the project, and that would be the second phase has been delayed by a year. So it's still on, you know, we still have a vision of having an urgent care center down there in the town of Bennington, but we're still, if we go ahead and do that, that's probably about a year to 18 months off. And then the project has to get a lot of finance and approval and so on. So still a vision, but not a plan, not an active data, agreed upon plan yet. Yeah, so it's still an apple in your eye, but nothing that has a direct impact on any budget issues at this point. Yeah, no, it would not budget. The impact would be, you know, it would take us 18 months to face this. You're talking about two and a half years out, at least. Yeah, so my last question is this, that I've actually used this Vermont Digger article that they wrote last May that profiled your kind of engagement in addressing the issue that there's been a, and I'm quoting here, a flip from 80% inpatient and 20% outpatient in 2000 to 79% outpatient and 21% inpatient in 2014. And then kind of at that point in time, one care came along and I'm just reading here from the article, but as a hospital transition, one care of Ramadi company also working to switch the state's healthcare model to value over volume came into play. Southern Vermont Medical Center saw an optimal window for transition. I think that was your quote. And so I'm just, you know, so then I'm looking in your narrative and seeing, you know, properly the raising of a flag that there is risk there with the one care and that if the risk quarters get too severe, you reserve the right not to participate. But I guess my question is that you are the premier hospital in my mind in Vermont, and I think Jess referenced this as well, that has engaged value-based care and 24% of your net present service revenues is a fixed perspective payment. And so I'm wondering where you think you are in terms of your relationship with fixed perspective payments. Are you where you want to be? Do you want to grow your share more? Do you think you're at the tipping point, which is a question that we've asked in the budget guidelines, you know, where that relationship is driving innovation and efficiencies in your system? Or do you think you're at the frontier and maybe need to pull back a little bit? Hey, can I answer the first part at Steve and you've jumped in, but I- Yeah, go ahead. I would say, Tom, that we embrace the movement towards value care. We know what there's a risk to it, but we have a significant amount of people who leave our region for care and they go to Albany and they go down to Massachusetts and other areas in New Hampshire. And I think if we can capture that market and provide care locally, I think that's gonna be a win-win for everybody. I think it's, you know, I think we can provide the care at a pretty high level of quality and at a little bit of a cheaper price than having those patients go to the academic centers in Albany or down in Massachusetts. So our goal is to capture that business and provide that care locally. And I think if we do that, I think the overall one care model benefits and I think it benefits Vermonters and it benefits us. And that's what we're trying to shoot for. But, you know, it's still, it's a dicey road and it's a lot of challenges to it, as Steve will attest to. And, you know, our board keeps our feet to the fire in this one. Yeah, and Tom, you know, Tom D said it right. If we can keep the patients here, okay, we know we can give high quality and with high quality comes low cost or lower cost. And let's take neurology and endocrinology as an example. We didn't have a neurologist for a period of time here. So all those patients had to leave. We now have one, okay? And Trey and his team are working on trying to recruit another one. And endocrinologist is another example. We didn't have an endocrinologist for a while. And those patients, when they need that specialty care, if our primary care physicians couldn't handle them, we'd send them to out, out. We now have somebody. So if we can pull all that volume back on the things we can do, okay? It's lower cost. Trey, you look like you're gonna add something to that. No, I don't have anything much more to add, but it is true. It's lower cost, but there's even lower indirect costs associated with people missing work to travel, the travel itself that really benefit from not even this budget discussion, but just the overall cost to Vermonters for participating in healthcare. So Tom, if we were able to curb, let's say 25% of that out migration and bring it back into SVMC, our revenues will go up, but the charge to the system, I would say it would still go up, but it wouldn't go up as much. It may actually go down, because if something costs, I'm making a number up, $10,000 in Albany or somewhere else, and we can do it for 9,000, okay? That's a savings to the system, but the hospital itself, we would see an increase, okay? So that's what we've been, and when you look under the hood of our strategic plan, a lot of it is keeping patients home on the things that we can do, okay, Tom? And just to quantify that number, just so the group's aware, it's about $50 million a year that outmigrates to these other markets, and then we can't do all that $50 million, but there's certainly a significant portion of that business that could be done locally. So let me just a quick follow-up. So why is there this out migration? Lots of, Trace, very aversive, but lots of reasons in terms of, not having enough specialists in certain areas. There's also, for people go for the name organizations, academic centers, a lot of challenges in terms of why people would go from a rural area to more in an urban area where there's a lot more choice, a lot more physicians. Yeah, Tom just said that just right. It actually depends on the specialty you're talking about. For example, I'll tell you, cancer care is different than gastroenterology when we look at the reasons people leave. So for gastroenterology, it's all about because we don't have enough supply here to meet the demand. And in cancer, we can meet the demand, but you're going to always get a certain percentage of people who want their cancer care at Dana-Farber or in Boston. And we do the best we can with that. Yeah. Just to remind you, Tom, that we're past board time and we have two more board members. So if everybody could keep it brief. Move along. I'm done. Okay. Maureen Youssefer, Maureen. Thanks. Fortunately, several of my questions have been asked, but I do have a few. Thank you very much for the presentation and the details specifically on the financials are very helpful. Just going through back to the, where you are on the projections, can you talk, Jess talked a lot about, ask a lot of the questions, but on the ACO reserve piece where you're actually going to get back, I think you said about a million dollars this year. How is that going to flow through? How is that going to improve your bottom line, if at all for 21? Can you talk to that and were you addressing that earlier when you talked about where the projections would be? That was included in my calculation, Maureen. That would drop to the bottom line, that million dollars from one care. Yeah. Okay, because I, assuming you were going to pick up probably about 2.8 million between that million and some of the money you're going to get back from that. But I also have some, I have reductions and other revenues happening and I have a retention employee retention program that I'll be accruing some expenses on. Right, okay. And then can you talk a lot about, will you then have any reserves left for ACO on your balance sheet? I have no reserves on my balance sheet for the ACO. In 2020, there was, for Medicare, there was no risk due to a public health emergency. And so far in 2020, for fiscal year 21, as long as the public health emergency goes into place, there'll be no reserves recorded. That's what I thought. Okay, okay. And just talking about the pension plan and kind of the ongoing benefit of that, it seems that there was, I believe there's going to be about a $5 million cash benefit each year. Is that true that used to fund for the pension plan? On a cash flow basis, yes. There's, that has been a drain to get fully funded. We started on the quest many years ago. Interest rates have not worked to our advantage, but when you look at the statement of cash flows, that I gave you last year, the years before we were running at about $5 million in the 21 budget, we anticipated three, we're going to come in at around six, and that'll put us in fully funded. So that won't have a negative, the cash generated from operations will not have to go to the pension plan. It will allow us to increase our capital purchases. It will allow us to do some other things related to our physical plant, our IT systems, and things like that. So our capital budget has been a little squeezed because of the pension over the years. Yeah, I mean, it's, your balance sheet looks pretty good. And so it's going to help obviously in the future to not have to fund that pension plan. Correct. Can you talk a little bit about 340B accounting and how that works on both the revenue and expense side? When we talk about any adjustments or reductions in 340B, we always talk about the other operating revenue piece. Are there offsetting expenses and the expense piece? I mean, I guess what's the net of benefit of 340B to the bottom line? So to the bottom line, 340B in our budget is about $5.5 million. Okay, a portion of that is what I'll call contract revenue for, which is recorded in net patient service revenue. And then on the expense side, there's two components. One is an actual operating expense. In order to realize those revenues and other operating revenues, we have to pay fees out to accrue those revenues. And then what is also built into our expense base is we buy drugs that we administer at a lower rate than we would if we were a non 340B. So it keeps our drug costs down, okay? So our drug cost, if we lose 340B, what'll happen is other operating revenues will go down, drug costs will go up, and we will lose some other administrative expenses that we have to pay out to realize the revenue on in other operating revenues. So overall other operating revenues down, drug costs up, other purchase services going down a little bit. And when you have those revenues for the 340B in the revenue section, then there are no corresponding expenses for drugs that are being administered there as an expense. I mean, I get you get the revenue, but isn't there a cost for the drug? Yeah, there are those costs in the operating expenses. So we'll lose those revenues and we'll lose those costs. And that's one component of 340B. Then the other component is when we purchase drugs today, we can purchase them at a lower rate. So our drug cost will go up. The drugs that we buy here will go up. Yeah, I'd love to see that reconciliation at least to understand the revenue, the revenue for the 340B, the expenses for the 340B, and then the other piece that you're talking about, which is just the general drugs that you administer that you'll have to pay higher costs for. Just as always, just a little bit of mystery of 340B in total. And certainly it could be impacting many of the hospitals in the future. Well, the eligibility though is specifically, I don't know the other hospitals if they've done the analysis, but we have the eligibility knocking at our door. Yeah, I think you may have a different issue. I mean, some of the other hospitals are talking about manufacturers that are no longer participating, so they're reducing the 340B piece, but all in all, every year, that's certainly a risk that comes into play that could be significant should you not be able to deal with that. Let's talk a little bit about something we didn't really talk about, which is cost-saving initiatives. And what major initiatives do you have? I mean, obviously you've gone through a lot as all the hospitals have through COVID. Well, what if any efficiencies are coming out of that? How do we look forward to be able to offset some of the cost shift and other things that are facing the hospitals versus commercial rate? So Maureen, currently there's not, we are continuing on our efforts for cost savings. And one of the ways that we do that, and I've said this before, is that our inflationary increases, okay, and let's take a manager, become to my office and say, you only get budgeted me 1% increase in inflation. Okay, it's gonna cost me 5% to buy the wax for the floor. And so we sit, I sit and I discuss it with them and the team works and we build in some incentives for the managers and we squeeze them a little bit and they gotta find ways to save. During this COVID period, we have not focused a lot on individual cost-saving programs. But if we lose 340B, we'll be putting together a plan. But we gotta make sure that we're equipped and that we have the staff and we have the supplies to treat our community during this COVID period. So currently, we don't have any specifics, but I can tell you this team, okay, and you can benchmark us against any other hospital in Vermont, any hospital in New England, our cost per whatever measurement is very good, okay. It's favorable to a lot of benchmarks. So, we will put something together over the next several months as if the legislation goes through, we will have to cut some costs. But I do believe that some, if we lose the 340B eligibility, some of it will come off of the bottom line because we can't cut to the bone. Yeah, it seems like one of us. I would add to that comment though, we are engaged with an outside firm who now is looking at each of our cost centers, Maureen, and we are now doing internal benchmarks on our staffing and our other expenses to see how each department stands up to us, ourselves internally, by the way, we're using, we're going back a few years ago when we think we were a little more efficient and we said, how do we get back to where we were before and again, we're always shooting for how do we get, can we get down to that 35th percentile in terms of our costs for similar size hospitals across the country? And we're not there yet, but that's why we wanna work with this an outside individual who will look at every cost center and work with every director. So I think that's going to be a piece of our plan and we are now planning to lose 340B. So we now figure out, we've got to really press the metal to figure out how we're gonna get around this challenge. Okay. Yeah, I mean, it does seem across many of the hospitals, one of the kind of maybe favorable outcomes and one of the things you're showing is no contract with labor. You pay in real quick to retain your staff, but that should be lower costs than getting, we're able to reduce some of the travelers. So at least it seems like people wanna come to Vermont and even in your recruiting for physicians and things like that, that maybe should we look back on this, there might be some net benefit for that. Yeah, that wasn't always the case. So actually about three years ago, we had about anywhere from 10 to 15 travelers in the hospital and we made a concert effort to change that and our Chief Nursing Officer did let the charge in that. Yeah, no, that's great. Thank you. And just one more question about now, I can't find it in my notes what page it was on, but I believe you talked about a new COMP model based on volume for office visits. Is that? Yeah, that in our risk and opportunities, we're rolling, we're working on a new COMP model that will include quality indicators into the COMP model for the physicians. So, so currently- The person also a volume component now. Yeah, yes. Was that there and? Currently it's volume driven, okay, the COMP model. So we're now moving towards volume and quality, okay? So there'll be a quality component and I know Trey and Dr. Salem and staff member and working with Dartmouth, we're looking at how do we incorporate in fiscal year and calendar year? Because the physician COMP models on a calendar year model, how in calendar year 22 can we get this quality component built into the COMP model? Okay, I mean, it's obviously good to see both, but having a volume incentive kind of goes against potentially some things, right? Well, I think, you know, and the way I look at it and the way Julia and my staff guide do it, it's gonna be a journey, okay? We can't just shut volume off in the physicians. So we're gonna be moving and hopefully each year put a higher level of that quality, a higher level of quality into the COMP model. But you gotta walk before your run and that's important. So, and we need buy-in, we need buy-in from everybody. And I think we, Trey, I'm gonna say we're getting it, right, so far. Yeah, you know, of course this conversation go forever. Volume itself is a little less risky than productivity itself. So if you have a primary care physician that can get in and see lots of different patients, that's different than measuring them by the numbers of tests they order or the things they do. I think Kevin's getting worried, guys. Luckily, we only have two hospitals today. We have all day, Kevin. But thank you. We do have other events scheduled this afternoon related to CONs and other things. So just a reminder to everyone. Are you finished, Maureen? I am, thanks. Great, thank you. So just a quick couple of follow-up questions. Steve, on the funds that, the relief funds that you received, was there any fun flow to the parent or other subsidiaries? No. Okay, great. And on the defined benefits, I got more confused as you went along. Oftentimes what you see is an institution like yours selling to a AAA financial entity the obligation and that makes sure that the employees are held whole. You talked about offering specific annuities to different employees. And so that confused me. If you could clear that up and on the same subject, if you could clear up, if it's just generally accepted accounting principles that require the hit all in one year, the 45 million versus the 12 million that you looked at on the balance sheet. So let me explain the termination and the current plan. The current plan has very few options for the employee. So on termination, what we are doing is we are offering the regular monthly benefit, they can select that, or they can select a lump sum payout, okay? That they can take and they can do whatever they want with it, they can put it in a tax deferred, they can take it and buy a new car and pay tax on it. So that gives a little more flexibility, okay? We will be turning for the individuals that will select a monthly benefit, okay? We will be selecting a AAA rated insurance company to administer the plan, okay? So that's the termination. So the responsibility goes to them along with the assets that we've been putting aside. Does that clarify what I said? It does, that clarifies that, but what about the financial statements? So on the financial statements, so each year, in the changes in net assets, when you do your pension accounting, you record a loss, we've been recording a loss each year in net assets that doesn't hit the P&L, okay? It's in other changes in the assets. Generally accepted accounting principles states that the cumulative effect of booking all of those entries when you terminate needs to be brought up and put onto the statement of operations. So we've been booking this in the balance sheet and we never talk about it, okay? Because it's part of the accounting gap requirement that we book it each year. And now that we're terminating, it has to be brought up into the statement of operations in non-operating activities, okay? So we've been booking this 45 million for the life of the pension plan, okay? And it's a little here, little here, and it just builds up. And when you terminate, it now has to come up into the statement of operations and non-operating activity. So when you look at the balance sheet, all that happens is the funding, and the number there was $12 million of which $4 million is something else, but that $8 million will get zeroed out, okay? And that really got zeroed out due to two things. One, the $6 million of funding this year and two, changes to the interest rate, okay? But on the balance sheet, you really won't see this $45 million change, okay? You really don't see it because it comes out of net assets, hits the statement of operations, and it washes out. I call it accounting mumbo jumbo, Kevin, okay? But it's just the way that the accountants it doesn't affect our balance sheet. If you look at our net assets, I'm trying to move to the balance sheet. Our net assets won't change significantly in total. Thanks, Steve. So the final question is for Trey. And Trey, you talked about the out migration, and I wanna thank you for filling out the form on the wait times and access. And we've only seen the first two submissions so far, which is you and Borrata borough. But I would say that as long as I've been on the board and even prior to being on the board, we all hear stories about people not being able to get proper access to care. And that seems to have escalated as volumes turn back to normal and hospitals were dealing with all this pent up demand. And we're hearing some real horror stories about people not being able to get the proper care. And I worry about, you guys mentioned it today, you mentioned it's more complex care that you're seeing in the hospital. And I truly worry that if people aren't receiving the appropriate care that we're gonna continue to see more expensive care. And Trey, looking at the different things that are on your form, areas like cardiology, neurology, endocrinology, dermatology, they all seem to be pretty high. And I just wanted your perspective on whether you think your hospital service area is getting the proper delivery of care and realizing that the huge obstacles that you're facing in recruitment and everything else. But Tom did say there he saw some benefit in recruiting as one possible positive thing that you don't find. So Trey, maybe you could address that. Right, yes. So I would say it will separate primary care and. You know, direct deposit, it will get my help in home insurance. So you mean electronics? Again, we have someone that is not muted that we're hearing. If you could go on mute. Trey, go ahead. Great. Yeah, so let me just separate real quick, primary care and specialty care. I think for primary care, we're gonna have to continue to recruit, but we also have to sort of revamp how the care is delivered in a more efficient way. We do have some thoughts on that as do others in the state and other think tanks nationally. And then specialty care, it's a combination of recruiting people in, but I've also tried to deliver that care remotely. I'm not just talking about traditional telemedicine, I'm talking about some sort of combination in that regard so that there's the combination of being here and seeing a physician or seeing an advanced practice provider, but having some of that analysis done remotely. So to keep it brief, I would say we have to come at it in all different ways. We have to recruit more people here and then we have to look at how can we deliver this healthcare in a more efficient way. And are people in the Bennington hospital service area receiving adequate care today? Yes, overall, there are definitely some things that are lacking and one, unfortunately, is oncology, cancer care, having to travel far. And another one is gastroenterology, although we're working hard to meet those demands, people are having to travel and some of that's acute, it's not just chronic conditions, it's some acute things. So yes, they are today. It's always a little tedious and we're working to make sure that we get that balanced, right? Thank you, Trey. At this point, I'm gonna turn the questions over to the healthcare advocate's office. And Mike, I'm not sure who's asking the questions for this hearing. I think you got me, Mr. Chair. Thank you. Thank you, Southwest. Appreciate the presentation and your answers to the question so far. We sent over a few questions, race equity questions in the last couple of days. Let me just pose them in one question. Can you talk to us about how your budget is a supports allocation of diversity, equity, inclusion, projects, trainings, collaborations? And yeah. Mike, maybe I can start and then Trey and Steve can jump in too, but certainly I think we have recognizes a need, more work to be done here. I think that's the reason why we was informed at the health system. First of all, it's a very, very large, active diversity and inclusion committee made up of physicians, staff, people, nurses. I think the group now is about 45 people who were made up. And part of that was based on a presentation that went to our board in terms of some of the challenges in our region. And that's why we went out and we hired a Director of Population Health who has under her responsibilities, diversity and inclusion. And she is spending a majority of her time working with community groups to, community groups at risk, let me say, who need to have, we think, better access to our healthcare services. So we're trying to institutionally from our board education on down to our medical leadership and administrative leadership, yet our organization very focused on the need to provide additional services here. Now, we don't allocate the time of those 45 people is absorbed by our institution. So you won't see a budget line for that group. We just incur those expenses and we give them time to work on this issue. But we are spending real direct dollars on additional staff education, all new employees go through diversity and inclusion type education. We are also now doing training for various departments. We have lunchtime lectures for departments that help educate them on it. And so I think we are moving in this direction there's more work to be done, but I think we're making some real progress. And certainly we understand from a governance standpoint on down is that we have to be more actively engaged and I think we're doing that. Okay, thank you. You've managed to cover a few of my topics and I'll let it go given the time pressure. I have one, let me get it open. I've spent a little bit of time looking at, I think this is a question for Steve, spent a little time looking at your bad debt and free care numbers through 19 and 20 actual and 21 projected. Obviously this question is in the context of the pandemic. Everything's been turned on its head. And so your numbers actually sort of bump along relatively flat from 19 to 20 actuals, which makes you an outlier. Most every hospital had a reduction in free care in 20 compared to 19. So that's a good thing though. Though I would say at the end of the day, you're projected 21 bad debt of seven million and you're projected 21 free care of 2.5 million. I guess I wanna ask you to comment on that. And I'd love to ask you to comment on both what happened on the ground through the pandemic in terms of being able to make the programs available to people and how you feel about where your numbers are landing at the moment. I think you're muted, Steve. There hasn't, the team that works for the outreach and working with the individuals on the charity care have been very active and we took some measures where we didn't do face-to-face interviews. We worked with a lot of people and made some phone calls and set up meetings and they just keep trudging along and working. The one comment that I did get, which was sort of a negative in preparation for this question was there aren't people that feel, they used the word entitled when in fact they don't meet the criteria. So the team said, maybe we need to look at our criteria a little more. So that as a result of your question, when I asked them that they said, we gotta look at our policy and look at our criteria a little closer because there are people that are pushing that says, listen, I need charity care. I was told I can get charity care and but when they give us all the paperwork and all the information, they don't qualify for charity care. So we put them on payment schedules and as for bad debt, our numbers really haven't changed much but we've been very flexible with a lot of people and if it's COVID related, we don't write it off to bad debt. We write it off to COVID allowances, okay? Because you can't go after people for certain services. And then we've also tapped into the HRSA website a lot, okay? To get me a burst from the federal government. So I think the real measurement, Mike, will be post-pandemic, what happens after, okay? And what happens to the numbers and the process after the pandemic? Because we're just trying to adjust every day on our feet. And so I don't know if that answers your question but that's the answer I got. They're scratching their head and the only thing that they said was they feel that people feel more entitled. I just clarifying question. Did you just say that there is another category of uncompensated care besides bad debt and free care of a COVID allotment? No, no, what I said was we're tapping in and maybe I didn't articulate it well. When it's COVID related, okay? We are filing with the HRSA because for vaccines, for testing, there's a fund out there that you can file. So things get written off to that. And then if we get reimbursed, we get reimbursed, if we don't, we don't. Yeah, if it's COVID related. Okay, thank you. Yep. Just for a quick, Steven, I'm sorry. If you are working on revising your policies and the materials, we put it on hold because of the pandemic, but we've worked out some templates with MVRAH and UVMMC. And so we have a lot of plain line with material and best practices already developed. So I think when you get around to that, presumably sometime in the future, after this current surge, please reach out because I think hopefully we can save, create patient-friendly policies and save for staff a fair amount of time. Sure, thank you, Eric. Yep. Thank you, Mr. Chair and you're muted. Kevin, you're muted. So at this point, I'm gonna open it up to public comment. And is there anyone who wishes to offer public comment on the SVMC budget? Hearing none, just a couple of administrative matters. First of all, thank you very much to everyone from SVMC. You're always very thorough and thank you. Kevin, he has his hand up. Okay, Sam. Thank you, Kevin. My question really gets to the, really into the area of healthcare reform. And I think that I wanna follow up a little bit on the questions like Jessica. The whole issue of reform basically is to try and shift, shift reimbursement to what I call fixed price contracts and whatever buzzword you wanna use to me the same thing. The, in your presentation, you have a table, a useful table that shows that they're, shows that the amount of money I think that you are involved with perspective reimbursement from three different pairs, Medicare, Medicaid and private insurance. My question is this, the, I think that both private insurance and Medicare through prospective payments, but then we, then they completely use shadow chief of service to reconcile at the end, which seems to me, but this would make us a question. Doesn't that be the reconciliation? We do see the intended incentive against overuse. And whether there's overuse or not to be argued about a lot, but my figures show that instead of 24%, which I think is what you've come up with for at-risk contracts with one care. I come up with just Medicaid, which is the only real risk, the only real risk there. Then what I get is 5.1%. And if you, and even that, half of that has to be allocated to understate providers. So that I get you really not much more than just over 2%. Can somebody address that question because I think it's important, thank you. I didn't follow the numbers. Currently we get reimbursed, you know, in our budget we submitted $42 million. The Medicare program is $27 million. That program, yes, it is reconciled back to fee for service from a cash flows perspective, but then it is measured against what our initial goals were going into the program. So that's $27 million. On the Blue Cross, as you correctly stated, the Medicaid is roughly 10 million bucks and that would be roughly, you know, is $10 million divided by 177. That's about 5% of our total revenues. And then the Blue Cross is another 5.2. That's the qualified health plan. So there's upside, downside to all of them. We could probably spend hours going through the mechanics of the risk components. And there are corridors that are added to this, but without getting into real details and spending a lot of time, you know, I do believe that we're at risk, there's 42 million in our budget and the corridors, you know, for Medicare, they have been as high as 4% to 5% on each side. So that does create significant risk for our organization. Well, thank you. This is a comment. I think if you did it quickly and slowly, you wouldn't get 5%, you get 5.1%. But that's the real number. All numbers, no actual risk to you, to your revenue stream from either Medicare or Blue Cross. Thank you. Okay, Dale Hackett and Brevity would be appreciated. I've just learned from the court reporters that there's a hard stop of one. We're already behind schedule. We have another hospital left to go. We'll have to shorten the bio break. Dale, fire away. All right, I'll be very quick. I've been in and out, so I may have missed what was presented. I wanna know about the risk you are experiencing within the workforce issues itself in terms of burnout. I'm gonna make it very quick. Do you know where I'm going and can you address that? Trevor, you wanna handle that one? Sure, I think first off, Dale, it's definitely awareness and attention towards people's wellness and wellbeing. And we are definitely doing our best. I think many organizations are recognizing that addressing this head-on is key to keeping the organization moving forward. We do that both through verbal recognition, but we also are really maintaining their vacations and ensuring that they are taking those vacations and taking a specific time for themselves. It's a real issue for sure, and I'm glad you asked that question. Thank you. Great, so I don't see any other hands raised. So at this time, I wanna thank SVMC. We are gonna take a quick bio break and we will be back on at 11.20 with Browderboro. Thank you, everyone.