Gov. Peter Shumlin signed Act 48 into law in 2011, and Act 171 in 2012. Together they promise the achievement of the longtime liberal goal of a “universal and unified health system,” that is, a government-controlled health system rationally designed, managed, and enforced by five government experts titled the Green Mountain Care Board. The governor’s target date for launching the single-payer health system is 2017.
Here are 11 questions a citizen might want answered about the approaching single-payer revolution.
1. Has Vermont sought outside expertise to create this universal system?
After the Legislature spent half a million dollars on two earlier studies, the Shumlin administration paid $300,000 to the University of Massachusetts to explain the needed amounts and mechanisms to finance Green Mountain Care, and the impacts of various tax increases on taxpayers, businesses and the economy.
2. So how did they recommend that Green Mountain Care be financed?
We may never know, because two months before the report’s due date (Jan. 15, 2013) the Shumlin administration told UMass to withhold any recommendations on how Vermont taxpayers could be made to produce the $1.6 billion a year — three times the state’s income tax collections! — needed to make Green Mountain Care viable. Gov. Shumlin now says the public doesn’t need to know those details until, most likely, after the 2014 election.
3. Will every Vermonter be included in this new system when implemented?
Ideally yes, but actually no. Medicare and Veterans Administration health care, plus the coverage of federal employees in Vermont, will remain under federal control. More than 100,000 employees of larger businesses with self-insured health plans can’t be forced into Green Mountain Care, per federal law (ERISA). So the “single payer” plan will be very far from “universal,” and the vast “savings” predicted from having only one payer — state government — largely disappears.
4. What is the health benefits exchange?
The Obama Affordable Care Act of 2010 pays participating states to establish insurance exchanges where households and businesses can go to purchase government-approved coverage. Alone among the 50 states, Vermont mandates that all individuals and all businesses with one to 50 employees must buy only through the exchange. Businesses with 51-100 employees will be mandated in by 2016. The Obama administration has paid the state of Vermont at least $126 million to create this exchange. (This is not a misprint.)
5. What’s the incentive to purchase through the exchange?
An approved exchange offers federal income tax credits to defray the expense of the premiums. Gov. Shumlin wants as many lives as possible to receive tax credits through the exchange, so in 2017 he can get the federal government to cash out the tax credits and write the state a big check to help finance Green Mountain Care. In fact, the state is aggressively encouraging employers to drop coverage, pay a federal penalty, and send their employees off to the exchange, to increase the tax credit total.
6. What if those employees don’t have enough money to pay the higher cost premiums of the policies in the exchange, even with the federal tax credit?
They’ll become uninsured.
7. If the exchange isn’t functional by Oct. 1, and individuals and small businesses are forbidden to purchase insurance outside the exchange, what will become of their health coverage?
When their current contracts expire, they will be uninsured, unless the administration waives the mandate requirement.
8. What will become of the exchange in 2017, when single-payer Green Mountain Care springs to life?
Under Green Mountain Care, there will no longer be any major medical health insurance. So the exchange will abruptly vanish — after taxpayers spent some $160 million to create and operate it for three years.
9. How does Gov. Shumlin think the Green Mountain Care Board will solve the “cost containment” problem?
Mainly through “payment reform.” It will replace the predominant “fee for service” medicine with some new arrangement, whereby the GMC Board pays money to a provider group that agrees to provide more efficient care. In March the GMC Board got another $45 million federal grant to figure this out. The most familiar model to Vermonters is “managed care,” in one guise or another.
10. Is all this believable?
Gov. Shumlin staunchly maintains that it is. But longtime single-payer advocate Hamilton Davis has observed, “The structural reforms that we need to get the rest of the way — payment reform and system integration — have not yet moved beyond the early planning and pilot project stage. These two initiatives sound reasonable enough, but they in fact presume a huge technical and cultural shift in the whole warp and woof of the delivery of health care, so that even 2017 will be a considerable stretch.”
11. What will happen if this grand scheme doesn’t work?
John McClaughry is vice president of the Ethan Allen Institute.MORE IN CommentaryThe days are getting longer and warmer, the snow is melting and soon we will have April showers —... Full Story
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