By Steve Early
The Nation, March 10, 2011

After years of political frustration, Earl Mongeon had to see it to believe it. Often, when he finishes his twelve-hour night shift at IBM in Essex Junction, Mongeon heads home for breakfast and a few hours of brush clearing on his sixty-acre lot in Westford. In mid-January, the 55-year-old microprocessor assembler and workers’ rights advocate hopped into his car and drove in the opposite direction, to Montpelier. There, at the state Capitol, Mongeon and other supporters of single-payer healthcare gathered to hear Senators Bernie Sanders and Patrick Leahy, Congressman Peter Welch and new Democratic Governor Peter Shumlin explain that last year’s national healthcare bill — a costly mix of subsidies to private medical plans, some insurance market reforms, Medicaid expansion and a mandate that people buy coverage if they don’t already have it — isn’t good enough for the Green Mountain State. The top state and federal officeholders pledged to work together for something better. “We firmly believe we can be the state that passes the first single-payer system in the country,” Shumlin declared.

Mongeon and other supporters of single-payer have marched and lobbied for years, most recently under the banner of the Vermont Workers’ Center and its “Healthcare Is a Human Right” campaign. Their tireless activism had a lot to do with spurring Vermont’s singular display of independence and political unity. Two weeks earlier, several hundred VWC supporters descended on the legislature on its opening day. State House and Senate leaders, including some recent converts to the single-payer cause, paid fealty to the grassroots movement. Before a boisterous crowd of union members and community activists, 71-year-old Peg Franzen, a VWC leader and disability rights advocate, hailed the “people power” that had persuaded legislators to commission a detailed study of options for universal healthcare last year. In late January a joint session of the Democrat-dominated legislature received a 203-page report from Dr. William Hsiao, the Harvard healthcare economist hired to develop a road map for reform. Hsiao’s research team identified fifteen hurdles to creating the system they recommended: universal coverage with equal access and a common benefit package that includes community-based preventive and primary care, as well as control in the escalation of health costs.

Undaunted by the roadblocks ahead, Shumlin’s special assistant for healthcare, Anya Rader Wallack, went before a joint legislative committee on February 8 to unveil H. 202, “An act relating to a single-payer and unified health system.” Wallack spelled out a three-stage reform process, spanning at least four years but beginning with the creation of a Vermont Health Reform Board to control costs and streamline payment methods. Wallack described Vermont’s current system of multiple private and public payers as “too complex and misguided,” noting that it leaves “more than a quarter of the state’s population potentially facing healthcare bills that send them to bankruptcy.” On behalf of the governor, she insisted that “this craziness must stop. We have to get insurers out of managing medicine and allow providers to use technology and appropriate quality oversight to get waste out of the system.”

The perfect storm for fundamental reform seems to have arrived in America’s second-smallest state, but the wind is blowing rightward elsewhere in the country, with the new Republican majority in the House voting to repeal the Patient Protection and Affordable Care Act, which they brand “Obamacare.” Red-state attorneys general and their GOP governors are challenging the constitutionality of PPACA by focusing on its controversial individual mandate. Healthcare reformers in Vermont aren’t happy with President Obama’s scheme either. That’s why they’re trying to create a social insurance system that would sever the connection between coverage and employment and make access to medical care a “human right” for the state’s more than 625,000 citizens. Marketplace competition and profiteering — given a renewed lease on life nationally by PPACA — would be phased out locally as soon as possible. If single-payer works in Vermont, its backers envision the state becoming the Saskatchewan of America, just as Canada’s thinly populated but left-led prairie province paved the way for Medicare-for-all north of our border fifty years ago.

Getting from here to there will not be easy. The Green Mountain State’s single-payer initiative could be delayed unnecessarily by the implementation timeline of PPACA. Under that law, every state must have health insurance exchanges in order to get the hundreds of millions in new federal dollars to subsidize private benefits. Unless PPACA is amended — as President Obama recommended on February 28 — any pilot projects headed in a single-payer direction would be delayed until 2017. In the now GOP-dominated House, Representative Welch has introduced a bill authorizing the federal waivers needed for Vermont to become “a laboratory for innovation and excellence” in three years, rather than six. As the New York Times reported on March 1, Welch’s bill has “no Republican co-sponsors, making its prospects for passage uncertain at best.”

Single-payer also faces resistance from big business, inside and outside the state. (A taste of that was provided six years ago by antiunion IBM, which held in-plant meetings for 6,000 workers to warn them that a single-payer bill, then pending before the legislature, would require $1 billion in new taxes and force businesses to leave.) A former state legislator from Putney, Governor Shumlin is also part owner of a family business that made him a multi-millionaire. In the face of blunt opposition from his fellow employers, he has pitched single-payer as a way to make Vermont more “business friendly” by curbing healthcare costs, which have doubled in the past decade. Many of the entrepreneurs affiliated with Vermont Businesses for Social Responsibility do seem to favor decoupling health insurance from employment, although not necessarily via a single-payer system. The more mainstream and politically influential Associated Industries of Vermont displays little enthusiasm for moving to a publicly funded plan financed by payroll taxes.

Speaking at a union conference in Burlington over Martin Luther King Day weekend, Mark Dudzic of the Washington, DC–based Labor Campaign for Single Payer Health Care warned about a deluge of anti-single-payer propaganda. “There will be a massive mobilization of corporate power to smash any state single-payer initiative,” he predicted. “Vermont is going to be one of the first battlefields in that fight.” In unionized workplaces — including those represented by the state’s two largest unions, the Vermont Education Association (VEA) and the Vermont State Employees Association (VSEA) — some single-payer advocates worry not enough is being done to educate and mobilize members, whose own negotiated medical benefits are currently at risk. In Vermont, as in other states, there’s growing taxpayer resentment at paying for coverage that most private-sector workers don’t have anymore, whether unionized or not.

At every teachers union bargaining table in Vermont, management is seeking bigger premium contributions, part of a larger giveback trend that has triggered several strike threats. No group of union members has a bigger stake in building a viable tax-supported system of universal coverage than public employees — because their healthcare is already publicly funded by state, county or municipal governments. Nevertheless, as VWC activist and VSEA member Leslie Matthews notes, her own union has not been leading the struggle because some workers are “apprehensive that healthcare reform could lead to erosion of hard-won benefits.” In reality, Matthews arg
ues, “it’s the rising costs, increasing inequities and cost shifts in our current healthcare system that will ultimately bring us down. As union members, our access to affordable healthcare will only be secure when all working people have access to affordable healthcare.”

Workers’ Center director and lead organizer James Haslam does report that the American Federation of Teachers, the Communications Workers of America and the AFL-CIO have all increased their funding of VWC activity. Other national groups, like the Universal Health Care Action Network, have created a “Help Vermont Win! Campaign Fund” to channel more resources into the fight. In late March Physicians for a National Health Program will send nursing and medical students to Vermont to rally support for single-payer. And on May 1 the Jobs with Justice–affiliated VWC will sponsor its biggest May Day “March on Montpelier” ever — to adopt the strongest possible version of Shumlin’s plan.

The new governor’s commitment to the cause is a case study in how Democrats could behave elsewhere — on healthcare and other issues — if their party faced more challenges from the left. Before his run last fall, Shumlin’s only previous bid for statewide office was a failed campaign for lieutenant governor in 2002. His candidacy, as a Democrat, was undermined when 25 percent of the electorate backed Anthony Pollina, a Progressive Party member and longtime single-payer backer who now serves in the State Senate. In last year’s crowded Democratic gubernatorial primary, all the candidates played a game of healthcare reform one-upmanship that helped solidify support for single-payer. Shumlin won the free-for-all by just over 200 votes, even though he was not the preferred nominee of the VEA, VSEA or state AFL-CIO.

In the general election, Shumlin’s opponent was Brian Dubie, an affable Republican who garnered some labor support based on his membership in the Air Line Pilots Association. In the last month of the campaign, the race was very close. That’s when the state’s big-foot independent socialist stepped into the ring. Rallying his own grassroots base, Bernie Sanders held a series of GOTV events for Shumlin that helped the Democratic candidate gain favor among working-class Vermonters who might otherwise have drifted toward Dubie. Shumlin ended up winning by less than 2 percent of the vote.

At a Nation book-signing event in Boston in February, Shumlin’s white-haired, 69-year-old helper was welcomed by local activists. In his discussion with them, Sanders noted that single-payer has become “absolutely mainstream” in Vermont because “we’ve been talking about the issue for thirty years.” But he warned that further grassroots organizing was needed because “this is by no means a done deal.” Back home, the Vermont Workers’ Center and allied groups are taking nothing for granted either, as they gear up for a spring offensive in Montpelier to keep single-payer from getting bogged down in the public policy equivalent of Vermont’s fabled “mud season,” which has never been kind to new models seeking traction, much less the fast track.

This article appeared in the March 28, 2011 edition of The Nation.

http://www.thenation.com/article/159158/vermonts-struggle-single-payer-healthcare

The following text contains the March 10 testimonies of professor Ellen Oxfeld of Vermont Health Care for All and Dr. Peggy Carey, interim chair of the Vermont chapter of Physicians for a National Health Program, before the Vermont House Committee on Health Care, regarding H.202, “An Act Relating to a Single-Payer and Unified Health System.”

Make it clear that single payer is the goal

By Ellen Oxfeld
 
I am Ellen Oxfeld. I’m a faculty member at Middlebury College and a board member of Vermont Health Care for All.
 
I have long supported single payer because it is conservative and practical and efficient, but that is not why I came today.
 
I don’t think I need to tell you that with single payer, we get more and pay less. We would be able to cover everyone, and cut down on bureaucracy. Nor do I need to tell you that single payer has been tested and tried, so we have plenty of experience with and evidence from single-payer systems in other countries and even with Medicare, which is really single payer for people over 65 (even though it is not perfect, we know it can work and has overhead of only 3 percent).
 
The challenge
 
H.202 is a road map to single payer and you should pass it. The comments that follow are simply measures I think would ensure that there are no “roadblocks” unintentionally placed in this “road map.” Any measure which might increase bureaucracy or inefficiency should be carefully considered since one of the goals is reducing cost through greater efficiency and less paperwork.
 
Payment reform and ACOs in H.202
 
I understand that some parts of H.202 are necessary in the transitional phase because of federal law and the prospect of federal funding – for instance, unless we can get an early waiver, we must construct exchanges. I understand that medical homes and other pay-for-performance projects can be constructed as ACOs and may qualify for federal funding which you all want.
 
However, I would still suggest a slight change in the pace of payment reform development so that we can adhere to the guidelines Professor William Hsiao has outlined. As he states, we have little evidence about how payment reform projects would work in Vermont. (These are called ACOs in Hsiao’s report, but they are clearly a parallel concept since in Hsiao’s report ACOs are entities that would be the focus of payment reform and which would attempt to coordinate patient care. That these two concepts are linked is also clear from Richard Slusky’s preliminary report on payment reform, in which the elements of reform and the type of organization he talks about parallel many of the features we commonly attribute to the concept of ACOs.)
 
It’s important to keep in mind that unlike single payer, ACOs are actually a new concept that was only developed in 2006, and there is barely any agreement on what they are, how they can be defined, or what they would look like. (We know the term was first used by Elliot Fisher of Dartmouth, that for a variety of reasons it became a popular idea, and that once it caught on it became part of the Patient Protection and Affordable Care Act.) However, it is certainly problematical to implement something that we can barely define (unlike single payer which is well defined and has been implemented all over the world).
 
For instance, on page 161 of his final report, professor Hsiao gives several possibilities of what an ACO might look like in Vermont, and they are really divergent – everything  from a Federally Qualified Health Center to a community hospital to a big hospital such as Fletcher Allen. He tells us that “the most effective ACO structure has not yet been determined.”
 
And to move to H.202, “payment reform pilots” are themselves not even defined, even though all other key terms in the bill are defined, such as the board, Green Mountain Care, health services, and health care professionals.
 
As such, it is not surprising that given the haziness of the entire concept, Hsiao recommends “rigorous evaluation” before anything is set in stone and implemented statewide (p. 159).
 
There are many complexities to the ACO/payment-reform concept. For instance, it allows for free choice of doctor and hospital, and patients are not restricted (nor should they be) to a particular ACO entity. Yet, how do you attribute savings to a particular entity when the patient is not a defined member of that same entity? How do you pay per member per month when you don’t really have members? If you have members, and they are bound to a particular health care entity, then it is getting close to an HMO, never mind an ACO, and you will have a hugely negative public reaction. And, finally, do you need a new bureaucracy to oversee this all? (For instance, you would need a complex set of rules and regulations and a new bureaucracy to figure out the payment system, such as to work out formulas for how to pay for a patient from one ACO who seeks treatment at a different ACO, etc. etc.)
 
Furthermore, how do you do any of this before your new financing system (single payer) is in place? H.202 states that insurance companies will cooperate on payment reform (p. 15), but then they will not be in the picture once we have implemented single payer (except to possibly administer claims). So, does it make sense for them to be involved in the design and implementation of a new payment system that they will have to let go of within a few years?
 
In short, to be successful payment reform needs be part of system reform and not to precede it. Additionally, something that has not been defined cannot be implemented on a wing and a prayer.
 
Recommendations
 
Based on the issues above, I would suggest the following:
 
1. Pass the bill. It is a road map to single payer.
 
2. Make it clear that single payer (universal health care that is publicly funded) is the GOAL of the bill and that the exchange is only an intermediary stage, and make clear that single payer is not an afterthought or a final stage that can be aborted.
 
3. Make some changes in the pace of “payment reform” as spelled out in the bill as follows:
 
a. Regarding p. 17, part (e). Rather than a payment reform pilot that will be operational no later than January 1, 2012, and two more pilots to be online by July 1, 2012, why not one pilot that will be operational by July 1, 2012?
 
b. “Rigorous evaluation” of this pilot should literally be written into the bill as professor Hsiao recommends in his final report (p. 159). There can be no doubt that you can’t start implementing an untried concept on a large scale before this evaluation.
 
– The criteria for this “rigorous evaluation” should also be spelled out in the bill.
– In the present version of H.202, health insurance companies are to play a key role in the strategic plan and implementation of payment reform. Shouldn’t their role be thought through more carefully, even in the design and implementation of a pilot? The ultimate goal of H.202 is a publicly funded health care system, and not a health care system based on multiple private insurers. It seems a bit odd that they would play a key role in designing something meant for a system which does not include them.
 
c. Define “payment reform.” You can’t have a pilot of a thing you have not defined. The bill does define even common sense or easily understood terms such as “health care provider” and “board.” Yet it does not define payment reform.
 
Conclusion
 
We don’t
want to add something that might possibly add more complexity to the simple and efficient system that is single payer. Single payer is not a concept, it exists in numerous places. “Payment reform” and “ACOs” are much trickier to grasp because they exist primarily in the concept world and not the real world. Thus, I would suggest a go-slow approach to payment reform while making a clear commitment to single payer. The financing system (single payer) must be implemented first. Experimenting broadly with new forms of payment during the transitional phase to single payer, and before the new system is implemented, may unnecessarily complicate our ability to get to the real goal – establishment of a single-payer system.

Vermont can do better: enact single payer

By Peggy Carey, M.D.
 
Thank you for inviting me to meet with you regarding single-payer health care. I am a family doctor presently working at Burlington Primary Care in Burlington. I have also worked for the University of Vermont Department of Family Medicine, practicing in Milton for 15 years.
 
When did I get interested in health care reform? Thirty years ago, when I was diagnosed with Type 1 diabetes and hospitalized with no health insurance. The same month I actually was married to my college sweetheart by a justice of the peace just so I could go on a group health insurance policy. I had been denied coverage through my own job in a bakery in Brattleboro. Because of my situation, I vowed to change the system and put my head in the books for the next 10 years to become a family doctor.
 
Our current health care “system” is failing as it denies care to millions in need, inflicts economic suffering, including personal bankruptcy, on our citizens and communities and is economically unsustainable.
 
How are health insurance company profits part of the “solution”?
 
In 2006, Vermont spent $3.9 billion on health care that didn’t include all Vermonters. In 2012, Vermont will spend $5.9 billion on health care and still not cover all Vermonters. This year, Vermont cannot sustain this $2 billion increase without true cost-containment reform.
 
Working with my medical colleagues as interim chairwoman of Vermont chapter of Physicians for a National Health Program, together we have collected over 200 signatures of both specialists and primary care physicians who support this single-payer legislation, H.202.
 
Over 380 Vermont family physicians endorse Dr. William Hsiao’s report, “Achieving Affordable Universal Health Care in Vermont.” In communities across Vermont, specialists and primary care physicians depend on one another and work together in the best interest of our patients. Both groups work hard to help Vermonters have optimal health care and both groups are frustrated when insurance companies deny care and decide what doctors an individual can see.
 
Implementing a single-payer health care system will remove obstacles to caring for patients by streamlining paperwork and incorporating true quality improvement and cost-containment through overarching planning and budgetary control.
 
Vermont is in a position to do better and lead the nation out of our health care morass.
 
In closing, I refer you to “Learning from Geese”: By flying in a V formation and alternating most forward positions among themselves (substitute doctors here), geese save 50-72 percent of their flying energy. As thrifty and fair-minded Vermonters, I urge your committee to choose the V-formation, the single-payer system that will save lives.

By Don McCanne, M.D.
 
As the author of a PNHP blog entry in November 2010 on the limitations of the Wyden-Brown amendment, which would move up the date when states could obtain waivers from the federal government to introduce their own state-based health reforms, I’d like to clarify my position.
 
It is true that moving up the date by three years alone is not enough to ensure that states like Vermont can enact a “pure” single payer model of reform. There would be more work to do. But that is not a reason to not move forward with enacting a system that is as close to single payer as is possible under current law, and to continue efforts to enact measures that would give states more flexibility in designing a comprehensive financing system.
 
What we really need is a national single-payer program, but, considering the national political scene, that is highly improbable in the near future — not that we shouldn’t continue to advocate for it in the strongest terms. But it would be wrong to say that we must have a national program or nothing. Too many will face financial hardship, or worse, suffer physically and perhaps even die, if we do nothing.
 
In parallel to our national efforts, the states should move forward toward accomplishing as much reform as is possible in the face of our current politics. If the states can provide some temporary relief from suffering and hardship before we are able to enact a national program, then, by all means, we should make those efforts. We should apply for all waivers currently allowable at the same time that we seek to change the law to allow the granting of other waivers that could further improve the state legislation.
 
At the same time, above all, we must continue the parallel effort to enact a national single payer program — an improved Medicare for all. If some states get there before the federal government does, then the relief from suffering will have been well worth the state level efforts.
 
Don McCanne, M.D., is senior health policy fellow at Physicians for a National Health Program (www.pnhp.org). You can subscribe to his “Quote of the Day” here or read them at the PNHP blog.