An act relating to establishing a process for the elimination of certain hospital services

The 'As Passed' document includes three distinct versions of the bill text (as introduced, as amended by Senate, and as amended by House) in a single compilation, while the 'As Enacted' version shows only the final enacted text. This is a standard legislative record-keeping practice rather than a policy change.

The first version shown in the passed document (titled 'HOSPITAL SERVICE REDUCTIONS; APPROVAL REQUIRED') would have applied to ALL hospital service reductions and required explicit approval from the Secretary of Human Services. The final enacted version applies only to eight specifically listed services (emergency, primary care, obstetrics, perinatal, inpatient psychiatric, substance use disorder treatment, dialysis, and inpatient pediatric) and requires notice rather than approval.

The first version in the passed document used a single-step process with one notice of intent. The final enacted version uses a two-step process: a preliminary notice with confidentiality protections followed by a formal notice of intent after consultation, with a 90-day window to proceed.

The first version in the passed document gave the Agency authority to approve or deny service reductions based on specific criteria (consistency with strategic plan, access burden, advantages vs. disadvantages). The final enacted version gives the Agency an evaluative and consultative role without explicit approval/denial power.

The bill now applies only to the elimination (not reduction) of eight specifically listed hospital services: emergency department, primary care including site closures, obstetrics, perinatal care, inpatient psychiatric, substance use disorder treatment including medication for opioid use disorder, dialysis including site closures, and inpatient pediatric services. The Senate version applied to any service reduction or elimination without limiting categories.

Hospitals considering eliminating services other than the eight listed categories may voluntarily provide a preliminary notice and engage in the consultation process, but it is not required.

The Agency of Human Services no longer has authority to approve or deny a hospital's proposed service change. The Senate version required the Secretary of Human Services to approve before any reduction or elimination could proceed, with explicit criteria for approval (consistency with strategic plan, no undue burden on access, advantages outweighing disadvantages).

A two-stage process was created: Stage 1 requires a preliminary notice of intent followed by confidential consultation between the hospital, Agency, and Green Mountain Care Board to explore alternatives. Stage 2 (if the hospital proceeds) requires a formal notice with a proposed timeline, transition plan, public hearings, website posting, and newspaper publication at least 60 days before the elimination takes effect.

All information and materials related to the preliminary notice and consultation process are exempt from public records access and kept confidential, except that for the eight listed service categories, the Office of the Health Care Advocate receives access (and may not further disclose).

The language on how savings from service eliminations are handled was narrowed. The Senate version allowed directing that savings be 'returned to payers and Vermonters to address affordability concerns or are reinvested in primary care, prevention, and other community-based services.' The enacted version limits this to savings being 'reflected in health insurance premiums or are reinvested in primary care, prevention, and other community-based services,' removing the broader affordability language.

The bill was renumbered from S.189 as passed by the Senate to Chapter 146 as enacted, with a governor signature date of June 16, 2026. The section title changed from 'HOSPITAL SERVICE REDUCTIONS; APPROVAL REQUIRED' to 'HOSPITAL SERVICE ELIMINATIONS; NOTICE REQUIRED.'

The core requirement changed from notice to approval. Previously, a hospital that proposed to reduce or eliminate a service only had to provide notice and complete a public engagement process before proceeding. Now, a hospital 'shall not reduce or eliminate any service without approval from the Secretary of Human Services.'

New approval criteria were added for the Agency of Human Services. The Agency may approve a proposal only if it determines: (1) the reduction is not inconsistent with the Statewide Health Care Delivery Strategic Plan or community health needs assessment, (2) the proposal does not unduly burden access to necessary care and services, and (3) the advantages outweigh any disadvantages.

The timing of community response summaries changed. Previously, hospitals provided a summary of public comments to the Agency after the conclusion of the public engagement process. Now, hospitals must provide summaries weekly during the public engagement process.

The notification chain to the Green Mountain Care Board changed. Previously, the hospital itself notified the Board within five business days of deciding to proceed. Now, the Agency notifies the Board within five business days after it approves a service reduction or elimination.

The language on how savings from service reductions are handled was modified. The old text said savings could be 'returned to Vermonters to address affordability concerns or to payers to be reflected in health insurance premiums or are reinvested in primary care, prevention, and other community-based services.' The new text says savings are 'returned to payers and Vermonters to address affordability concerns or are reinvested in primary care, prevention, and other community-based services,' removing the specific reference to health insurance premiums.

The bill's core mechanism changed from requiring agency approval before a hospital can reduce or eliminate services to requiring only notice and public engagement, with the hospital retaining the right to proceed after completing the process. The section title changed from 'APPROVAL REQUIRED' to 'NOTICE REQUIRED.'

The word 'intentionally' was added to subsection (a), narrowing the bill's application to deliberate service reductions or eliminations rather than potentially covering incidental or unplanned changes.

The Agency of Human Services role was reduced from an approval authority (which could deny a proposal if it found the reduction inconsistent with the strategic plan, unduly burdensome to access, or if disadvantages outweighed advantages) to an advisory body that provides nonbinding recommendations to the hospital, the Green Mountain Care Board, and the public.

A new subsection (c) was added requiring a hospital that elects to proceed with a service reduction after completing the notice process to notify the Agency of Human Services within five business days of its decision, so the Agency can inform its transformation efforts and the Green Mountain Care Board can review budget impact.

The public engagement summary requirement was changed from providing weekly updates to the Agency during the 30-day public engagement period to providing a single summary after the process concludes.

The language on how savings from service reductions may be directed was clarified: savings can now be returned 'to payers to be reflected in health insurance premiums' rather than the broader 'to payers and Vermonters.'