Senate President John Campbell says it's very unlikely that the Senate will pass one of Gov. Peter Shumlin's top legislative priorities this session: making a significant reduction in the Medicaid Cost Shift.
Campbell says the governor's plan would have a detrimental impact on Vermont's business community.
Typically, Medicaid pays between 40 and 60 percent of the cost of a service and the remaining costs are shifted over to private insurance premiums. Shumlin proposed a .7-percent payroll tax that would raise roughly $90 million dollars on an annual basis. This money would then be matched with $100 million dollars in federal funds.
The governor wanted to use a good chunk of this new money to increase Medicaid reimbursement rates for health care providers. He said his plan would reduce the cost of private insurance premiums by as much as five percent.
Senate President John Campbell says many businesses in Vermont are just recovering from the recession and that a payroll tax could be a huge burden on many of these companies. "It was the wrong time in the sense of how the governor wanted to address that … they were planning on doing a payroll tax,” says Campbell.
"We have to understand that these businesses employ people, and if businesses close we don't have employment." - Sen. Campbell
Campbell says he has met too many business owners who are having a hard time making ends meet. "We have to understand that these businesses employ people, and if businesses close we don't have employment,” says Campbell.
The House is struggling with a plan to raise $20 million dollars for its health care package. It includes some money to reduce the cost shift by imposing a $.005-per-ounce tax on sugar sweetened beverages.
"There are also some people who question really the size of the cost shift. Is it really as large as what it has been portrayed to be?"
Campbell has doubts about the House approach. "That's not going to do anything to the cost shift as is set out by the administration,” says the senator. “There are also some people who question really the size of the cost shift. Is it really as large as what it has been portrayed to be?”
The House plan also includes a provision that calls for greater transparency in medical pricing and Campbell says he hopes the Senate can adopt this part of the House bill in the coming weeks.
