Boston’s Pioneer Institute Examines Vermont’s Health Care “Reform”

Boston’s Pioneer Institute recently covered a forum held there by The Blue Cross Blue Shield Foundation of Massachusetts on Vermont’s efforts to move towards single payer.  Here are a few of their observations:

Using the data and criteria cited at the forum, every state should be moving towards a single payer system. Of course some on the left nod their head in agreement, to the rest of us, the logic seems flawed at best. For example, how does 7% uninsured in Vermont justify single payer? The national average is close to 17%.

Of course Blue Cross has a vested interest in supporting this approach, for now anyway.  As the article points out:

Vermont is picking Blue Cross Blue Shield of VT as the sole insurer in the state and kicking out the rest. The Legislature decided not to run a pure single-payer system and keep this non-profit insurer in business. In a more competitive state for insurers, this would not have happened. Time will tell if BCBSVT comes to regret this decision and is driven out of business as well if the government changes direction, and brings everything “in-house”.

The following observation should be of more interest to Vermont’s future patients under this system:

VT is setting up an IPAB mechanism in the state to help form a more “rational” system and help to control costs. This will lead to market distortion, rationing, or increasing taxes.

The article then goes on the point out the many challenges the plan faces and laments the lack of attention being paid to these challenges:

Finally, I have been disappointed in the press coverage on this issue. They have failed repeatedly to cover the many hurdles ahead, with the exemption of the funding piece.

These are foundational issues that should not be lost in the excitement that seems to come whenever a state tries something big. It is similar to writing about the shiny outside of a new car without looking under the hood first, where you would discover there is no motor.

Finally, there is the obvious alternative that most of Vermont’s  advocates and political class seem to be ignoring:

Many of the issues that a single payer system is attempting to address can be dealt with by greater consumer engagement, a federal tax policy change to delink insurance from employment status, and greater transparency in the health system. The press coverage fails to mention any other alternative. For our part, Pioneer recently released a paper on the efforts by local private sector companies to crack this health care crunch here in Massachusetts.