Health plan issues unsettled until after election
By PETER HIRSCHFELD
Vermont Press Bureau | October 07,2012
MONTPELIER — Nearly three months have passed since a team of university researchers began work on a $300,000 study aimed at developing a funding mechanism for single-payer health care. But top officials in the Shumlin administration say they don’t yet have any additional information about how much the universal system will cost, or what kind of tax will be used to pay for it.
The administration in early July inked a $300,000 contract with the University of Massachusetts Medical School that will eventually yield answers to some of the most politically charged questions of this year’s race for governor: How much will single-payer cost? And how will Vermont pay for it?
In debates and on the campaign trail, Republican challenger Randy Brock has seized on those unknowns to try to sow anxiety among voters. He says it’s unfair for Gov. Peter Shumlin to seek another two-year mandate without first answering such basic questions.
“We still don’t know how much it will cost, we don’t know who will pay for it,” Brock says frequently on the stump. “We don’t know what will be covered, we don’t know who will be covered.”
Robin Lunge, director of health care reform for the Shumlin administration, says the study’s attempts to answer those questions likely won’t begin to trickle in until after the Nov. 6 elections.
“They had had some glitches with their actuarial firm they were working with … which I think will push the date out a little bit,” Lunge said last week. “At this point … I would guess it would be after the election before we get numbers.”
And as administration officials and lawmakers assess the realities of a partisan congressional dynamic, the timeline for single-payer has been stretched far longer than was envisioned in the law that authorized the new health care system.
Administration Secretary Jeb Spaulding said that when the Legislature passed the single-payer law in 2011, officials were optimistic Vermont could obtain the waivers it would need to proceed with the publicly financed system as early as 2013. He said those hopes have since been dashed.
“We haven’t changed at all on where we want to go or why we want to do it,” Spaulding said. “But it’s become more certain that the likely date to get (single-payer) is 2017, not 2013 or 2014, and that has a bearing on some of the financial aspects of it.”
Spaulding said he’ll still fulfill his statutory obligation to deliver potential single-payer funding plans to the Legislature by Jan. 15. But he and others say that since single-payer can’t happen until 2017 at the earliest, there’s no point in taking any legislative action on funding options.
“It would not make a lot of sense to ask the Legislature to pass a financing plan for something that’s not going to take effect for years into the future,” Spaulding said.
Sen. Claire Ayer, an Addison County Democrat who chairs the Senate Committee on Health and Welfare, said that if lawmakers had known in 2011 what they know now, they wouldn’t have set such an early deadline for the presentation of single-payer financing options.
“I don’t think we would have asked for it quite so early,” she said.
Ayer said the Legislature will have its hands full putting together the federally mandated “health benefits exchange” during the 2013 session.
The exchange, part of ObamaCare, is a federally mandated online insurance marketplace that aims to reduce the number of uninsured Americans by subsidizing premiums for low- and middle-class individuals. The exchange would be going into place whether Vermont was on the road to single-payer or not, though Shumlin is designing the exchange to serve as a jumping off point into the publicly financed, universal system.
“My perspective is that we have a lot of work to do on 2013 in getting the exchange up and running, and there are some financing questions about that,” said Rep. Mike Fisher, a Lincoln Democrat, chairman of the House Committee on Health Care. “And I think that’s the work the 2013 Legislature has on its plate, and that’s where my focus will be.”
Lunge said the new timeline for single-payer won’t render the $300,000 study any less useful than it would have been otherwise. While specific cost elements outlined in the report may change between now and 2017, she said the report will establish the basic “parameters” around which the single-payer system will eventually be crafted.
A contract enumerates the scope of services that will be provided by UMass, beginning with a tally of estimated costs for the new system. The university financing team will then examine projected federal revenues — money that will arrive in Vermont in the form of Medicare, Medicaid and tax subsidies rolled into Obamacare.
Finally, contractors will explore financing options, including “taxes, fees, assessments, premiums and any cost-sharing,” according to language in the contract.
When the study is complete, Lunge said, “we can look at a much broader combination of options and start to think about what makes the most sense, how it’s going to impact on people, and have a much deeper understanding of where we’re going and how we get there.”
Spaulding said the scope of the overhaul envisioned by Shumlin is so substantial that it will be helpful to begin discussing financing plans years in advance of single-payer’s arrival.
“I actually think it’s a positive thing to be taking place right now,” Spaulding said. “Since we now know we’re on a different time frame, we’ll have more chances to have a dialogue with Vermonters in settings around the state.”
Sen. Ann Cummings, a Washington County Democrat, chairwoman of the Senate Committee on Finance, said that while passage of a single-payer tax may still be years out, she thinks it will be helpful to begin the discussion in January.
“Obviously trying to figure out how you’re going to fund a system and make that kind of transition and not hurt the quality of care or the providers is not going to happen overnight,” Cummings said. “So I think this will be a good jumping-off point for us to start our serious look at what this is actually going to look like.”