Has Vermont carved a path toward single payer health care or caved into powerful insurance company lobbies?
Maybe just a little bit of both.
Has Vermont drawn a new line in the sand for health care reform or outlined a sketchy drawing towards the future?
Yes to that as well.
On May 27th, 2011 Governor Peter Shumlin fulfilled a campaign promise to move the state toward a single payer health care system when he signed H-202.
As the saying goes, you can’t make an omelet without breaking a few eggs. In this case, the analogy works pretty well.
H-202 outlines a path that takes features from current state and federal realities and blends it with recipes offered by the federal health care reform to take Vermont where previous federal and state lawmakers have feared to tread.
Should we be surprised that the descendents of the Vermont Republic break several cherished taboos in their legislative approach to health care reform? Should we be upset that so many details need to be filled in along the way?
The Vermont law declares health as a right, not a privilege. This is significant. While I have challenged the notion of a health care as a right, the people who organized grass roots support for this quantum leap forward have used that rallying cry as a reminder of our obligation to provide for those in need.
If I were to characterize the Vermont process it would be – design; build; and remodel. It is an incremental journey toward a revolutionary change; an evolutionary approach to species change.
Design
A friend use to say, “plan your work and work your plan.” Likewise, measure twice and cut once. Carefully plotting out a design change as profound as this is critical to success and Vermonters were careful to not over prescribe in the legislation. Vermont must create a five member board, nominated by the governor and approved by the legislature. That Board must wrestle with a broad range of issues that would lie outside the scope of most health plans in today’s market. They include:
- Designing a benefit package
- Setting payment rates and methodologies
- Addressing adequacy of health workforce issues
- Hospital budgets and capital expenditures
- System performance and quality
- Health information technology.
- Approving rate requests.
That’s a tall order and time will tell whether it is best left to a single entity.
Build
The build phase uses the structure outlined in the Patient Protection and Affordable Care Act.
It will build the insurance exchange that will allow individuals and small businesses to shop for health insurance. The number of insurers will be limited and will include a “public option”, the Green Mountain Health Plan. Benefit design options will be limited as well and will be prescribed by the Green Mountain Board.
It will offer comprehensive, affordable, high quality health care coverage for all Vermonters, regardless of income, health status or availability of other coverage.
As required by ACA, there will be a ban on pre-existing conditions and all Vermonters will be eligible regardless of employment status.
Remodel
The remodel phase may be the most challenging phase as the Green Mountain Board will need federal waivers allowed under the ACA to create a single payer health plan. That plan will combine the people currently enrolled in Medicare and Medicaid with a broad swath of the Vermont population, including public employees, individuals and small groups.
To Vermont’s credit, they added a feature near to my own experience. They also included workers’ compensation in the Green Mountain Health Plan. I have seen too many people delay treatment while lawyers argue whether a specific treatment is the responsibility of the health plan or workers’ compensation, an utter waste of both financial and human resources.
A late Senate amendment requires that the Green Mountain Board determine that certain legislative goals will be met with the implementation of the single payer system before the transition to a single payer system.
With the federal waivers, the program will be funded by
- Federal Medicaid funds
- Federal Medicare funds
- State Medicaid funds
- State contributions for its employer plans
- Employer contributions for small group plans
- Individual payments for individual insurance.
- Employer payments for the medical portion of workers’ compensation (normally 50% of workers compensation premiums)
Critics are quick to question how the program will be funded; yet it is hard to image how the program would need substantial supplemental funding. In fact, I could image a scenario where the state could reduce certain taxes and replace them with a revenue neutral dedicated income tax that would highlight the total cost of health care in Vermont, much of which is obscured under current financing methods.
The Vermont law lays out an ambitious program that goes far beyond the roles assumed by most health care purchasers, including even Medicare.
Like Medicare, the Green Mountain Board will promote provider payments reforms with some of the same models proposed in the ACA, Accountable Care Organizations, and Medical Homes.
The Green Mountain Board also folds in powers traditionally assumed by states such as certificate of need (approval of capital expenditures) and hospital budgets, approval of health insurance rates, approval of a Health Information Technology Plan, development and maintenance of an adequate health care work force, as well as developing and maintaining a system to evaluate overall system performance and quality. That is a pretty tall order.
Vermonters have pushed the envelope on health care reform. What was once off the table is now being served up as the main course.
For those who have brought the state this far, their work is just beginning. Not only must they wrestle with the devilish details that confound any change, they will also confront those evil demons who will make every effort to thwart and reverse this initiative.
Like many, I have questions and I hope Vermonters and others will join a dialogue and offer their own thoughts and perspectives on how this process will unfold over the next five years.