Advocates push new hospital care funding
By DANIEL BARLOW
Vermont Press Bureau
Article published Jan 4, 2008
MONTPELIER — While legislative leaders talk about a slow expansion of Catamount Health and Gov. James Douglas eyes reforms to stem jumps in insurance premiums, a wide-reaching proposal for the health care crisis is gaining steam among advocates.
The Vermont Hospital Security Plan would create a new statewide hospital budget to pay for all visits to the 14 nonprofit facilities, essentially creating a single-payer health insurance system for hospital care.
“As a state we need to deal with the rising cost of health care and a big part of that is the cost of hospital care,” said Rep. Francis “Topper” McFaun, R-Barre Town, one of the three lead supporters of the bill. “With this proposal, no one would have to worry if they can afford an important trip to the hospital.”
The bill was proposed during the 2007 legislative session, but seems to be gaining traction among single-payer advocates as lawmakers return to Montpelier for the 2008 session.
Take Back Vermont Healthcare, a new statewide lobbying network of single-payer advocates, intends to apply some pressure on lawmakers to support the Hospital Security Plan. The group will kick off its efforts with a rally on the Statehouse lawn on Jan. 9 at 11 a.m.
“This is a bill that would do something for all Vermonters,” said Dr. Deb Richter, a Cambridge physician who founded the Take Back Vermont Healthcare network. “No other bill out there would reduce premiums by 40 percent.”
Advocates point to potential cost-savings of such as system: While Vermonters would still need insurance for doctor visits and prescriptions, cutting hospital care out of the equation should reduce premiums by 40 percent.
The cost of creating a state-run hospital system is pegged at $710 million a year, which would require implementing new taxes. But Richter said this is really a cost shift from people paying their premiums for insurance to paying the state, a move which is estimated to reduce the costs by 9 percent (Vermont now spends about $776 million annually on hospital care).
How to create a state-funding mechanism for the single-payer hospital system is something lawmakers need to decide, Richter said, but she added that one option would be a 5.5 percent payroll tax, split between employers and employees, and an annual $225 fee for each Vermonter.
“We are already paying more than this,” she said. “And this is one way to get our arms around the hospital budgets.”
But the state’s hospitals have some serious concerns about the plan, according to Beatrice Grause, the president and CEO of the Vermont Association of Hospitals and Health Systems.
She praised McFaun for raising the issue of payment reform in the medical field, but added that “this seems to be the wrong approach.”
She added she doesn’t think this will reduce costs on hospitals; in fact it may increase costs if Vermonters put off day-to-day health maintenance in favor of going to the hospital when a crisis occurs because the trip will be free.
“The devil is in the details, but I don’t think this will offer a peace of mind for the hospitals,” Grause said. “This could really result in some cash flow problems for the hospitals.”
Meanwhile, top elected officials in Montpelier also are not embracing the single-payer hospital proposal.
The Democratic leaders of the Vermont House and Senate are proposing an expansion of Catamount Health, the state’s new insurance program for uninsured residents, to also include small businesses, which are in a pinch with employee health insurance cost increases that for many are hitting the double digits.
Senate President Pro Tem Peter Shumlin, D-Windham, said Wednesday at a Statehouse press conference that he is a supporter of a single-payer system — but that smaller reforms, such as the proposed Catamount expansion, are needed to get there.
“If you are asking me if we will be passing a $1.2 billion health care bill in this session, the answer is no,” Shumlin said.
House Speaker Gaye Symington, D-Jericho, said during her press conference Thursday that a single-payer hospital system was discussed in the legislature in 2006. But, that option was dropped in favor of tackling the problem with the uninsured — a move that led to the creation of Catamount Health, she explained.
And Gov. James Douglas said in his meeting with reporters Thursday that stemming the tide of health insurance premium increases is one of his top issues this year, but added that he could not support proposals that relied on new taxes.
Still, Rep. Steven Maier, D-Middlebury, the chair of the House Health Care Committee, said McFaun’s proposal is one of the options that he will hold hearings on this year — even though he himself has some reservations as well.
“Once we start, there will probably be lots of debate over this one,” he said. “And I have some of my own questions. We all agree on the goals, but the disagreement seems to be how to get there.”
Maier added that the name of Richter’s new network left him feeling cold. The phrase, “Take Back Vermont,” was a slogan used by those who opposed gay rights during the civil union debate seven years ago and has become a symbol of the divisiveness and animosity of those times.
“The name unfortunately invokes that time in Vermont,” Maier said.
Richter acknowledged the name is intended to provoke. She explained it reflects the movement to take the health care system in Vermont away from the insurance companies.
Richter added that she and other supporters are facing an uphill battle on the single-payer hospital plan. But she is hopeful that hearings under the Golden Dome will result in a stronger groundswell of support.
“We at least want this proposal to see the light of day,” she said. “Let’s explore this idea and see what Vermonters think about it.”
During the months between the end of the 2007 legislative session and the start of the new one, McFaun traveled across the state to hold town hall-style meetings on his proposal — and said he received many welcoming and supportive comments.
“I’m grateful that this has gone from being a piece of paper stuck on the committee room wall to the promise that there will actually be hearings,” he said.
Contact Daniel Barlow at daniel.barlow@rutlandherald.com.