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Officials: Lack of Health Exchange Competition Won't Affect Costs

Starting in January, all individuals and businesses with fewer than 50 employees will go through the new Health Insurance Exchange, known as Vermont Health Connect, to purchase insurance policies.

To date, two companies have been approved to sell policies on the exchange – Blue Cross of Vermont and MVP. An application by a third entity, the Vermont Health CO-OP, has initially been rejected by the state. In larger states, there are as many as a dozen carriers selling policies.

Shelburne businessman Al Gobeille has been named as the next chairman of the Green Mountain Care Board – the group that oversees virtually all aspects of health care in Vermont.

Gobeille says he’s not concerned about the lack of competition on the Exchange and he says it reflects the reality of the current insurance market in the state.

“I think that the two issues here are competition and choice and so the question is do more insurance companies lead to increased competition and then somehow drive down costs and we don’t see that when we look around America,” says Gobeille. “So the next choice would be choice does it limit somehow choice of doctors, choice of care choice of services and we’re not seeing that either.”

the question is do more insurance companies lead to increased competition and then somehow drive down costs

All policies sold on the Exchange will have the same benefit package and the cost of premiums will be tied to the individual deductibles and co payments in a plan. Gobeille thinks it’s a good system for consumers.

“The point is that I think what we have now and the transparency we’re going to see what these rates are we know what the product is people are going to be able to make a very informed decision,” he says. “It’s a marketplace for health care that someone in America hasn’t seen before, it should be a very good thing for the consumer.”

Darcie Johnston is the director of Vermonters For Health Care Freedom – a group that favors a free market approach to health care.

She thinks Vermont has too many health care regulations that drive up costs. She thinks people should be allowed to buy out of state policies that are less expensive because they don’t include some of these mandates. 

Johnston says there's no reason Vermonters should not be able to buy health insurance across state lines.

"With our small population numbers we would have seen a true exchange marketplace that would have met the health care needs of Vermonters and been truly affordable, and I don’t believe this current exchange is affordable at all.”

State officials say they are confident that Vermont’s Health Connect will be up and operating by its launch date of October 1st.

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