State hires contractor to evaluate Shumlin's single-payer financing options

June 24, 2014

VTDigger

Morgan True

Bids on a state contract to evaluate financing plans for a public, universal health care program in Vermont were due Tuesday.

The selected vendor will design microeconomic models that will allow the Shumlin administration to test the economic impact of the different financing plans. The universal health care system is expected to cost the state between $1.8 billion and $2.6 billion in the first year of operations, according to Robin Lunge, director of Health Care Reform.

“If you think about how you would build a health care system, you start at the macro policy level and then get more and more granular,” Lunge said.

The Rand Corp, the Urban Institute and the Massachusetts Institute of Technology (MIT) submitted bids for the work, Lunge said. The value of the contract won’t be known until a vendor is selected.

The administration still intends to present a financing proposal to lawmakers in January, Lunge said, but added that it won’t present a plan that isn’t fully vetted. The original deadline for the financing plan was January 2013.

The selected vendor is expected to begin work in July, and Lunge said she thinks six months is enough time for them to help the state iron out the details of a workable financing plan.

“With this kind of planning process everything is difficult to predict when you’ll hit a certain stage, but given the previous six months, this is really fitting in to where we hope to be,” she said.

The simulations the vendor will run are expected to show how health care dollars, which account for one fifth of the state’s economy, flow from individuals and businesses through the current system, how different plans to pay for a universal health care program might change behavior, and how the flow of money might change as a result.

The contractor will do that for Vermont’s entire population using demographic, family size, income, health status, health care utilization, current health coverage, and cost data, according to the request for proposals.

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