Larson: “We need more systemness”

by Rob Roper

Rep. Mark Larson (D-Burlington)

Rep. Mark Larson is the official sponsor of H.202, but this is really Governor Peter Shumlin’s single payer health care bill. Explaining the rationale behind the bill to the Democrat caucus on Tuesday, Larson stated, “Many of us have come to believe that the only way to control cost and to increase access and quality care is to create more ‘systemness’ in our health care system.

Larson’s reference to increased access, one that is echoed loudly by single payer supporters, is in conflict with what Shumlin said in his January 27 press conference: “Our challenge [in creatig a single payer health care system] is… about cost containment. It isn’t about access. Catamount was about access. That was a mistake.”

Another line of argument Shumlin and supporters have used repeatedly during the debate is that we cannot continue to do what we’ve been doing or we will bankrupt our state. However, isn’t increasing government’s role in health care, expanding regulations, redistributing resources and limiting (or eliminating) private sector choices exactly what we have been doing to get where we are?

In 1991-92, when Vermont state government took on a much larger role in health care passing community rating and guaranteed issue, there were 33 competitive insurance companies offering affordable insurance policies in the state. According to a 2007 study commissioned by America’s Health Insurance Plans (AHIP), “Prior to reform, indemnity insurance with deductibles as low as $50 was available. In 1998, the lowest indemnity deductible was $1,000, and in 2006 it was $3,500.”

After the government mandates were put in place,

Rate increases for the two leading indemnity insurers averaged 14-18% per year for the two years following the reforms. Subsequent increases were generally comparable between the small group and individual markets, and… double digit increases occurred regularly throughout the 1990s.

Medicaid expanded to cover roughly 25% of Vermonters because private insurance was no longer affordable to many. Now, of course, only three carriers remain, and the cost of insurance is both unsustainable and on the verge of bankrupting Vermont.

This process of squeezing out providers and options via regulation and mandates sounds very much like what Larson described to his colleagues as the strategy behind implementing a fully single payer system.

To the degree you can use the exchange [required by Obamacare] to identify a single benefit package and to qualify for the exchange you have to provide a certain package of benefits, and then you attempt to look for providers who are willing to use a common reimbursement system, a common formulary, you are creating the basic elements of a single health system… But the ultimate step would be to then take those that we’ve worked on for commonality within the exchange to then broaden them to the whole system after that….

“Maybe I should go back,” Larson continues. “If you believe that free market competition and market forces are going to reform our health care system (laughter), you would go for a … model where you just let anybody in at whatever price they want to price at… If you think that creating a more unified system for getting our health care costs down and providing access to everyone than what we’re trying to do is use the exchange to start bringing pieces together.”

Yes, maybe we should go back. If you look at history and results we need less “systemness” and more of the free market competition that drew derisive laughter from our leaders.