Gov. Peter Shumlin will unveil his single-payer financing proposal later this month. But a powerful Senate lawmaker says the Legislature might want to spend less time this year talking about how Vermont pays for health insurance, and focus instead on making sure everyone is getting it.
Few people in the Legislature will have more influence over the health care debate in than Sen. Tim Ashe. The Chittenden County Democrat not only chairs the committee that handles tax matters for the Senate, he’s also the Senate President’s most trusted advisor on health care reform matters.
Ashe says he isn’t necessarily opposed to pursuing a publicly financed health care system. But he says the payroll tax on employers that would be needed to fund it will make it a difficult goal to attain, at least in the short term.
“You might put small businesses out of business,” Ashe says. “ You will change the equation for many small businesses in ways that might include lowering the number of hours their employees work, lowering compensation for their employees in other forms, whether it’s vacation time or salary or whatever.”
"The challenge with single-payer as currently envisioned is that it creates lot of turbulence to get to where we are today to the vision that people have for the future." - Sen. Tim Ashe
Ashe says the majority of small businesses in Vermont currently pay nothing toward their workers’ insurance benefits. Requiring them to do so, he says, would likely result in significant economic dislocation.
“The challenge with single-payer as currently envisioned is that it creates lot of turbulence to get to where we are today to the vision that people have for the future,” he says.
But Ashe says that on one thing, everyone can agree.
“I believe people across the political spectrum believe that every person in Vermont should have health insurance,” Ashe says. “So, I believe that at a minimum we should come out of this legislative session with a plan for how we’re going to get everybody health insurance.”
And Ashe says the path toward universal coverage is free of some of the political hurdles standing in the way of single-payer.
“I believe, I happen to have a radical belief, which is that we can provide insurance to every person in Vermont without raising a penny,” Ashe says.
"I happen to have a radical belief, which is that we can provide insurance to every person in Vermont without raising a penny."
Rather than devoting the next session to an examination of the pros and cons of whatever single-payer financing plan Shumlin presents at the end of this month, Ashe says the Legislature ought to devise a means of achieving universal coverage.
Ashe says he would accomplish this task by taking all the money Vermont already spends on health care for the uninsured, and using it to buy insurance for them instead. He says the state would likely need to find additional dollars as well. And for that money, he says he’d look to the largest cost centers in the health care system: hospitals.
Ashe says the state could take a number of approaches to curbing administrative costs as hospitals. But he says he doesn’t think it makes sense for either legislators or members of the Green Mountain Care Board – the five-person panel that regulates hospital budgets – to be micro-managing medical centers.
Instead, he’d like to set a new cap on administrative expenses at the 13 hospitals in Vermont, and then use the resulting savings to provide insurance to the 47,000 or so Vermonters that don’t have it right now.
“The Green Mountain Care board could quite easily say ... that administrative spending in the hospitals in fy17 or fy16 will not exceed 97 percent of what it was in the year before … But we can just dictate that their administrative spending will go down, and then leave it to them to figure out the best way to do that. I happen to believe that there will be no layoffs as a result of such an action, no one will even notice the difference. It will just force the savings. That savings is not insignificant, and it becomes a tool to meet the needs of the uninsured,” Ashe says.
“Changing from a premium system right now … to tax-financed system, has nothing to do with providing another person insurance. It has nothing to do with saving money in the system. It has nothing to do with global hospital budgets. It has nothing to do with increasing the quality of care. It has nothing to do with any of that."
Bea Grause, president of the Vermont Association of Hospitals and Health Systems, says hospitals will be eager to work with Ashe to figure out a way to deliver universal coverage. But she says administrative costs fund activities that directly impact patient care. And Grause says reducing those costs won’t be easy, or without consequence.
“You know, you might be surprised at the things that are considered administrative costs, such as the expenses to run a pharmacy and electronic medical records,” Grause says.
Whether or not Ashe pursues his plan for universal coverage depends on whether his Senate colleagues share his enthusiasm for taking that route. He says he’ll be speaking with his Senate colleagues after the financing plan is revealed to gauge their feelings about it. If a majority of the Senate wants to devote its focus to vetting the governor’s financing proposal, then Ashe says that’s what his committee will do. If there’s more of an appetite for alternate reforms, such as the one he’d like to consider, then he says he thinks the question of how to pay for health care can wait.
Ashe says Vermont can’t ever truly have a single-payer system, since multiple entities will always be paying into the system. And Ashe says he believes that many people have come to view single-payer as a cure-all for problems that he says it wouldn’t actually solve.
“Changing from a premium system right now … to tax-financed system, has nothing to do with providing another person insurance. It has nothing to do with saving money in the system. It has nothing to do with global hospital budgets. It has nothing to do with increasing the quality of care. It has nothing to do with any of that,” Ashe says.
Ashe says single-payer could perhaps solve a problem that needs addressing, and deliver “a more rational system where people perhaps pay in a more progressive scale and bizzes pay in a way that is not completely disadvantageous to those who try to take care of their employee and give some a free ride.”
But if that’s the aim of Shumlin’s push toward a “single-payer” system, Ashe says, then the Legislature might want to consider whether there are other ways to get there.
“The first question is, what’s the point? If the point is that currently some people pay too much and some people pay too little, for no good reason, you have to ask if having a tax-financed system is the only way to rectify that, or whether it could be done through the existing model,” Ashe says. “And we’ve spent probably too little time asking that question.”
