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Copley Presents FY19 Budget to GMCB

August 27, 2018

Request for Rate Increase Driven by Labor, Drug & Supply Costs  

Morrisville, VT – Copley, like all Vermont hospitals, will present its FY2019 budget to the Green Mountain Care Board. Copley is scheduled to present its budget on Monday, August 20th.  A copy of the hospital’s presentation is available online (below).

Copley has had a 3.2% rate decrease cumulatively over the past 5 years, resulting in less than a penny on the dollar operating margin (0.8%). In the same time frame, the cumulative state-wide rate increase was 18.1%, resulting in a 3.2% operating margin state-wide.

Copley’s expense drivers are labor costs (including market adjustments for retention, recruitment, travelers, and investments in growing our workforce from within), double-digit inflation with drug costs and drug shortages, and supply costs. Hospitals across the state are affected by these same cost drivers.
Supply costs are increasing 6.8% at Copley, due to the mix of services provided. More than half of the surgeries performed at Copley are orthopeadic and include a high rate of total joint surgeries.  Orthopaedics has larger supply costs compared to other services as it uses more equipment and instruments as well as implants, prosthetics and tissues.

These cost pressures in addition to the need to rebuild the hospital’s operating margin is driving Copley’s request for a 7.9% rate increase in FY19. This proposed increase will result in a cumulative rate decrease of 3.2% for Copley Hospital over the four years ending in FY19.

Copley officials believe that the GMCB’s goal of 3.5% state-wide may be an achievable goal, but individually, each hospital’s budget needs to be considered on a case by case basis based on utilization trends, service mix, capital needs, and overall financial health.

Copley Hospital is greater Lamoille County’s non-profit community hospital and one of the area’s largest employers. Copley offers 24-hour emergency services, a family-friendly Birthing Center, and excellent inpatient and outpatient care with specialists, including Cardiology, General Surgery, Obstetrics/Gynecology, Orthopedics and Rehabilitation Services on its campus in Morrisville. Visit www.copleyvt.org or call 802-888-8888 for more information.

FY19 Budget GMCB Presentation _08202018