Rutland Herald: The governor shocked the political world this past Wednesday by announcing his administration is no longer supporting a tax package to publicly finance health care.
The plan had been to eliminate insurance companies and the roughly $3 billion we Vermonters pay them each year in the form of deductibles, premiums, co-pays, etc., with an approximately $2 billion package of taxes to fund the nation’s first universal health care system. I truly believe the governor and his team left no stone unturned in their effort to develop a financing package for this new system that was workable.
But before I go into the details of the governor’s decision, it’s important to remember the most important reason why we must change the way we pay for health care — it has been, and always will be, about people. Every one of us — healthy, sick, young or old, rich or poor, employer or employee — is affected by the high cost of health care. And there are many reasons one could identify, but the main culprits are the lower wages we are paid at work to offset our employers’ rising health care premiums, the debt from unpaid medical bills and increased taxes to pay for the almost 50 percent of us already receiving some sort of publicly financed health care.
According to the last estimate, there are about 40,000 uninsured Vermonters, people living a single accident or unexpected illness away from financial catastrophe. There’s a reason that unpaid medical bills are the No. 1 reason for bankruptcy in our country. They add up fast. Even having insurance in today’s world is no guarantee of being free from harm. For example, nationally more than 100,000 people diagnosed with cancer file for bankruptcy every year despite being insured.
The Time magazine article “Bitter Pill: Why Medical Bills Are Killing Us” has one of the many examples of how outrageous payment for care under the current system is. According to the article, it was standard practice, and fully legal, for a hospital in Connecticut to mark up many times over what it charges patients for a variety of standard medical supplies such as $18 each for 88 diabetes-test strips that Amazon sells in boxes of 50 for $27.85.
And Vermont Health Connect, the health care exchange, mandated by Obamacare, doesn’t go nearly far enough to make health care truly accessible and affordable for low and middle-income Vermonters. For starters, its open enrollment period is only three months long. After that, you need a special qualifying event to get insurance. And as an example of its high costs, take a couple whose gross income is $47,000 a year who buys the most common plan. They are still on the hook for more than $11,000 every year in premiums, deductibles, etc., before insurance will cover all of their medical bills.
So what does all of this have to do with the governor’s decision to halt his pursuit of a universal, publicly funded health care system? Pretty much everything. Without a universal system, it is going to be nearly impossible to make sure people can actually afford the care they need, when they need it while truly reining in the rising cost of health care.
Under the governor’s proposal, every Vermonter would have had next to no deductible or co-pays, much like our incredibly successful Dr. Dynasaur program. It would have divorced all of us from getting insurance through our employer so we all could be free to change jobs, start our own businesses or even retire early without fear of going uninsured.
One Band-Aid solution is for the state to further subsidize low- and middle-income Vermonters insurance costs incurred under Vermont Health Connect. This would have the very real effect of lowering consumer’s premiums, deductibles and other “out of pocket” costs and thus greatly easing the financial strain of paying for care. One possible source of financing for this subsidy that has been widely discussed is a tax on sugary beverages such as soda, sports drinks and energy drinks. This tax would raise close to $30 million a year, more than enough to fund this and other initiatives to help Vermonters lead healthier lives.
So the question for all of us to ponder in light of the governor’s announcement is how do we keep moving forward to achieve the goals of creating a health care system that insures everyone, is truly affordable and stops the rising cost of health care? Because only then will our work be done.
Peter Sterling is the director of Vermont Leads, a nonprofit advocacy organization dedicated to enacting a universal, publicly funded health care system in Vermont.