Vermont lawmakers hear about singlepayer health care (BFP)
MONTPELIER — An economist who helped
Taiwan and other nations create their health
care systems told Vermont lawmakers Thursday
that a single-payer plan can lower costs, but is
not necessarily a foolproof remedy.
William Hsiao, an economics professor at
Harvard University, testified before House and
Senate health committees as Vermont legislators
look for ways to broaden health care coverage
while also curbing escalating costs.
"Single-payer can actually lower the level of
health spending," he said of a system where
there is a single insurance provider. "Singlepayer
is probably the most effective tool to
reform health care delivery."
Taiwan was able to shrink the number of
uninsured residents from 45 percent to 5 percent
in a year after creating a single-payer plan,
Hsiao said. In the first two years, costs dropped 8
percent to 10 percent, he said.
A bill from the Senate Health and Welfare
Committee would create a panel to come up with
three options for a health care plan for Vermont.
Committee Chairman Doug Racine, DChittenden,
noted that that’s the approach Hsiao
and others used in Taiwan.
The bill is pending before the Senate
Appropriations Committee, which will decide
whether to come up with $400,000 to pay for the
panel’s work, as the bill seeks.
The bill carries an interesting political dynamic,
as Racine, Appropriations Committee
Chairwoman Susan Bartlett, D-Lamoille, and
Senate President Pro Tempore Peter Shumlin, DWindham,
are all seeking the Democratic
nomination for governor and seeking to
distinguish themselves among likely Democratic
voters for whom health care reform is a key
topic. They all have a role in how this legislation
proceeds.
Shumlin has ideas about the health care bill that
vary slightly from Racine’s and said he would
seek to amend Racine’s bill. Instead of a panel
producing three options, Shumlin wants the
Legislature to hire Hsiao to advise whether the
state can create a system that provides universal
access, curbs costs, offers quality care and is
detached from a person’s employment.
"None of us can tell you how much that would
cost or how we would pay for it," Shumlin said. "I
feel we need answers to those questions."
Taiwan’s system has not been without problems,
Hsiao said. Every five to seven years, the system
has a deficit, he said, and the payroll tax has to
be increased as health care costs go up faster t
han income and no regular increase was
included. The tax has gone up from 4.25 percent
of one’s pay 15 years ago to 5.09 percent this
year, he said.
Rep. George Till, D-Jericho, asked Hsiao whether
a national system could work in a single state
where many hospital patients come from
neighboring states. Hsiao said he didn’t think the
system would create as much savings, but
thought it could produce some savings.
Taiwan’s system is different than Racine was
expecting. Thirty percent of the cost is paid by
the government, 35 percent by payroll taxes on
employers and 35 percent by payroll taxes on
employees, Hsiao said. Those without an
employer pay a premium, except for low-income
people, he said. There are co-pays for doctor,
clinic and hospital visits and prescriptions, he
said.
Shumlin said Hsiao’s trip to Vermont on Thursday
came at no cost to the state.