Issue Overview: Most issues are cyclical. However, the debate over health care has been perennial. The 2005-2006 legislative session was by and large no different than more recent sessions, but this one did differ in that candidates during the 2004 campaign, almost without exception, campaigned on the promise to address health-care reform. Early into 2005, there was no united front on health care or even a consensus timetable for dealing with the massive problem that many have described as a time bomb.
During the 2005 legislative session, the General Assembly passed a bill that would have established a government-run, taxpayer-financed health-care system. Gov. Jim Douglas swiftly vetoed the bill for 11 specific reasons.
There were two distinct issues that faced the General Assembly, however, and they were intertwined. The first is the ongoing Medicaid deficit, currently surpassing 80 million dollars, and the other was affordability and access to health insurance.
Facts about health care in Vermont:
- Twenty-two percent of Vermonters (more than one in five) are enrolled in a state-funded health-care program, which reimburses health-care providers at less than the rate it costs to provide the service.
- The deficit in Vermont's Health Care Trust Fund is expected to grow to more than $245 million by the year 2009.
- Vermont effectively has no individual health insurance market.
- Vermont's small businesses bear a disproportionate percentage of the insurance premiums.
- It would cost nearly $4 billion to fully fund Vermont's current health-care system.
A number of third-party groups banded together in 2005 to develop alternative proposals to a government-run, taxpayer-financed plan. Coalition 21, formed in 2004 to build consensus about how to transform Vermont's health-care system, established six principles that were used by most advocates of health-care reform as a benchmark for alternative proposals.
- Universal access to essential health-care services.
- Coverage for care that is comprehensive and continuous.
- Continuous improvement of health-care quality and safety.
- Health-care financing that is sufficient, equitable, fair and sustainable.
- Built-in accountability for quality, cost, access and participation.
- Engagement of all Vermonters in healthy lifestyles and informed use of the system.
Gov. Douglas promoted a health-care reform package during the 2005 and the 2006 session and worked with health-care reform proponents to pass the Catamount Health Care plan.
NFIB Position: NFIB/Vermont supports legislation that would provide for greater access to lower premium health-care plans for small business. NFIB is working at the national level to pass legislation to allow for Small-Business Health Plans. At the state level, we support legislation that will facilitate the sale of health savings accounts and provisions of law that will reduce the overall cost to the health-care system without adding an additional burden to Vermont’s small businesses.
NFIB members have consistently voted in favor of consumer-directed policies such as HSAs, authorized as part of the 2003 Medicare Drug Act. That law provides for federal income deductions for employees for contributions to their HSA but not for their high-deductible health plan premium. Employers (except for sole proprietors) can deduct their contributions to employees' HSAs and HDHPs. There will be proposals in Congress to extend the deductions to cover all employer and employee contributions.
NFIB opposes a taxpayer-financed, government-operated health-care system and opposes a tax increase as a way to finance a new system.
Issue Status: The General Assembly passed the Catamount Health plan, a new health insurance program intended to cover an estimated 25,000 Vermonters who are not now insured. This plan will join the other public health insurance programs offered in Vermont (Medicaid, Medicare, and the Vermont Health Access Plan), adding at least $60 million to the state's $1 billion-plus cost of current health programs. The new program is to be provided by private insurers.
The plan will be funded by Vermont taxpayers via an increase in the cigarette tax (80 cents a pack). Employers will pick up a significant share through an employer assessment, and the newly insured will be required to pay on an income-based scale (ranging from $60 to $400 a month in premium). By 2010, in addition to the premiums paid by the newly covered employees, the charge to employers will total at least $93 million, of which $59 million will be contributed by Vermont's smokers.
Two other components of the health-care debate included the passage of legislation that establishes a pilot program to allow for a safe apology, so that an apology by a health-care provider would be inadmissible in court as an effort to prioritize the patient’s health over litigation. A number of commonsense initiatives were also included.
These initiatives included healthy lifestyle discounts, wellness programs, medical event reporting and patient safety improvements, common claims forms, provider credentialing and provides some transparency of costs associated with health-care services to consumers. These were advocated by NFIB/Vermont along with a number of other business organizations. These provisions, however, don't have specific implementation dates, so continued advocacy is required.
What to Do: Study the implications of this legislation and discuss your concerns with candidates prior to the Nov. 7 elections.
- Urge them to repeal the employer assessment.
- Urge them to oppose tax increases and tax expansions of any sort.
- Urge them to implement the commonsense initiatives and cost containment measures to address the increasing cost of health care.
- Urge them to oppose further reform measures that move Vermont closer to a single-payer, taxpayer-financed system.
