Vermont News – WCAX.com
August 30, 2006
MONTPELIER, Vt. — Vermont could offer health coverage to all its residents and spend $51 million less a year on health care under a single-payer system, according to a legislative consultant’s report released Tuesday.
But while businesses that currently offer health insurance to their employees would save money, those that don’t _ and their workers _ would see a combined new 13.4 percent payroll tax that even some single-payer advocates see as fatal to the plan.
Sen. James Leddy, D-Chittenden, and Rep. John Tracy, D-Burlington, co-chairs of the Legislature’s Vermont Commission on Health Care Reform, joined the consultant, Dr. Kenneth Thorpe of Atlanta’s Emory University, in describing the report’s findings at a news conference.
“I assume employers would pay about 75 percent of the total (10.1 percent payroll tax) and workers the remaining 3.4 percent,” Thorpe said. Those taxes would be a new expense for businesses and their workers that don’t have health coverage now, he said.
“On the other hand, some employers and families currently pay more than 10.1 percent and 3.4 percent of payroll respectively for insurance and would pay less,” he wrote.
For their money, they would get a “a benefit package modeled after the typical plan in the state,” he added, saying that half of those who currently have insurance have more generous coverage.
Thorpe said copays and deductibles would be set very low under his plan. “These low cost sharing obligations will result in substantial reductions in consumer out-of-pocket spending.”
The lawmakers said Thorpe’s report was not a formal proposal, but was merely informational and one option as they pursue the key goal of health care reform legislation passed in each of the last two years: moving Vermont from a state that has an estimated 61,000 uninsured and 180,000 underinsured to one that offers universal coverage.
Leddy called the report “one more step in our ongoing process that will continue.”
Thorpe, Leddy and Tracy acknowledged that the coverage would not be truly universal. It would exclude Medicare beneficiaries, who already get comprehensive health coverage for seniors from the federal government.
Also excluded would be Vermonters who work for out-of-state employers, whether private companies, national nonprofits or the federal government.
Jason Gibbs, a spokesman for Gov. James Douglas, said the single-payer plan envisioned in the Thorpe report would result in less comprehensive health coverage for many teachers, state employees and others whose employers currently offer more generous plans.
Gibbs said the state should concentrate on implementing health care reform already passed, including the Catamount Health plan designed to get coverage to the uninsured. He noted the legislation’s emphasis on managing chronic diseases, which he said account for 80 percent of health care costs.
“From the governor’s point of view our focus should be laserlike as we implement Catamount Health and these new reforms and our focus should not be on ways to increase taxes,” Gibbs said.
Dr. Deborah Richter, a Cambridge-based family physician and president of the single-payer advocacy group Vermont Health Care for All, called the payroll tax a “nonstarter” because of the opposition it would generate among Vermont’s small business owners.
But she called the report “a great way to open the discussion” about moving the state toward a single-payer system.