After paying $300,000 for a health care reform financing plan, we are delivered a report that has no plan about how to finance the reform some of Vermont’s political class has been raving about. Here is an article from Vermont Digger breaking the news to the public:
Taxpayer dollars would fund an estimated $1.61 billion of the system — an estimate that relies heavily on the assumption that federal revenues would rise as a result of increased enrollment in Medicaid, which some skeptics question.
The study’s conclusion is undercut by a caveat that the estimates might turn out to be invalid due to outdated numbers and shifting details surrounding the structure, slated for implementation in 2017. The report does, however, provide a general financing structure for plugging in new numbers.
What surprised many legislators was that the so-called plan, which was mandated by Act 48 in 2011, lacked a specific vehicle for how the public would pay for such a system.
“It’s not really a plan but a variety of options set forth on the table,” said House Speaker Shap Smith, D-Morrisville, about the proposal that the University of Massachusetts (UMass) drew up for $300,000. This sum also included another plan for funding elements of the health benefit exchange, set to open on Oct. 1, 2013.
I really do not see why anyone would be surprised that the financing plan lacked specifics about how the plan would actually be financed. The plan itself is pretty much the same one proposed by Dr. Hsiao minus the financing details. Those details were not politically popular, so they were dropped like a hot potatoe: “A previous single-payer report by Harvard professor William Hsiao recommended an 11 percent employer payroll tax, which was extremely unpopular among the business community. The UMass report makes no tax recommendations.”
“The UMass report makes no tax recommendations.” No kidding! Apparently these people are savvy enough to know that Shumlin and company do not want any real number to get out in public again. We paid Dr. Hsiao $300,000 to come up with a plan and ended up rejecting the financing details of his plan. We put over $1 million into assembling the Green Mountain Care Board to work out the details of the plan and have paid $300,000 to UMass to come up with a financing plan and we still have no financing plan despite the mandated deadline in ACt 48 passing! Instead we have the Governor informing us that he needs mone time. Perhpas he would like more money to fund another study as well.
After having initially given the appearence of bipartisan support for tackling this issue sooner, rather than later, Speaker of the House Chap Smith is not echoing the Governor’s retreat. The following is from a Vermont Digger article about the areas of agreement between the House Democrats and Republicans:
On the opening day of the 2013 legislative session, House Speaker Shap Smith urged the assembled representatives to be “brave enough to chart new courses” in education, health care, and climate change. House Republicans are “excited” about addressing the first two, House Minority Leader Don Turner said, but cool to the latter.
Republicans will also be paying close attention to two key dates for the state’s new health care system: Jan. 24, when the Shumlin administration plans to unveil the financing plan, and March 15, when the pricing for specific health care plans will be revealed. Turner said he has concerns about the affordability of the plans but he was heartened that Smith addressed the issue in his speech. “I’m excited that we are going to keep it in the public.”
Now Smith is singing a different tune:
“Quite frankly, a plan at this point in time would be premature,” Smith said. “I suggested that to the governor last year, given the fact that we didn’t have a waiver in place.”
The federal waiver Smith referred to is necessary for the state to break away from the requirements of the Affordable Care Act. It is essential to the state for implementation of the single payer health care system that Gov. Peter Shumlin has promoted for the past two years. The earliest Vermont could obtain this waiver is 2017.
Smith said that it would not be constructive for the Legislature to consider public financing options until 2015 because of the many potential changes to the state’s health care system between now and then. Smith’s statement echoes those made by Gov. Peter Shumlin, who wants the Legislature to focus its health care energy on issues surrounding the implementation of the health benefit exchange.
If a plan at this point would be “premature” why was ACT 48 pushed through? Wwhy did we pay $300,00 to Dr. Hsiao come up with a plan? Why spend over $1 million to form the Green Mountain Care Board to come up with a plan? Why another $300,000 to UMass to come up with a plan? Some of us have been arguing all along that part of the problem is trying to push a plan on the public without informing them how much it was going to cost. On the other hand, some Democratic lawmakers are sending Shumlin a message that “time’s up:”
But not all Vermont legislators want to wait until 2015 to begin discussing how to publicly finance a health care system the state is on track to implement according to statute.
Democratic Sen. Tim Ashe, who chairs the Senate Finance Committee, said the Legislature must begin to consider financing options now — not later.
“You need broad recognition that you’re heading in the right direction before implementing a $1.6 billion tax increase,” he said. “I don’t believe the Legislature can show up in January and leave in May and convince the public. It has to happen starting today. Frankly, the Green Mountain Care Board, the Legislature and the administration have paid too little attention to the sticker shock that these changes will have on Vermonters.”
He said this year his committee — responsible for revenue generating measures — will look at the proposed single-payer models and the potential public revenue sources that would fund them. Ashe also wants to work with the Shumlin administration to initiate a substantive dialogue with the public — something the administration has been talking about for several months.
Earlier last week, Democratic Rep. Mike Fisher, who chairs the House Health Care Committee, said that his committee would also need to at least discuss how to generate public revenue for a single-payer system.
Perhaps more Vermonters should join in and tell Governor Shumlin that his time is up.