Vermont's state Senate on Monday spotlighted how progressives can leverage opportunities in President Obama's Affordable Health Care Act to re-introduce single-payer health care concepts and principles, in a very constructive and pragmatic way, into state politics across the country. The current Republican tactical dementia that twists every policy into a deficit debate - including Obama's health reforms - has served in Vermont to re-validate a key principle in cost control at all levels: Some private interests - especially the insurance companies - must be removed and constrained or it will not be possible to control costs.
For states, most of whom cannot constitutionally run deficits, publicly financing anything becomes a careful balancing act. Vermont happens to be a state where borrowing money is not forbidden, but they run a balanced budget anyway. However, Vermonters calculated that there was a huge savings from eliminating profiteering in insurance, as well as even bigger savings in consolidating the very burdensome administrative costs for hospitals, doctors, employers and governments with multi-payer systems. Universal health care with health insurance companies removed from the equation will find it much easier to bargain with drug companies - one of the other private interests driving health cost increases. It will also make it much easier to change the many fee-for-service arrangements with doctors that contribute to health care costs and that are not aligned with positive, measurable health outcomes.
State single-payer adaptations to preparing for the broader coverage required under the Affordable Care Act by 2014 are complicated by several factors - but all of them provide good opportunities for progressive forces to generate substantive ballot initiatives, or refreshed candidacies from the left in the primary season.
First, a single-payer approach needs a definition that makes a credible argument allowing Secretary of Health Kathleen Sibelius to grant the state approval to integrate its plan into the overall federal health care objectives. For example, in Vermont the solution will not be completely single-payer. Big self-insurers (like IBM) will be excluded. Payments to Medicaid and Medicare (both also government programs) are excluded. Payments under some older existing Vermont state programs for children, the handicapped and elderly will also be excluded. However administrative control would be uniform.
Second, estimated costs to new and old Vermont businesses seeking to provide insurance for employees would be greatly reduced - a big jobs incentive. However use of employer versus general tax sources to finance the single-payer pool and administration must be carefully crafted - and left open for political negotiation. This will be true for every state because the process of breaking apart the health care system and rebuilding it is very complex, For example, the Vermont bill establishes important single-payer principles, but it leaves until January 2013 - after the next election - the crucial question of how the new system will be paid for. Also to be decided later: what exact health services the benefit package will cover.
Third, to comply with Affordable Care Act requirements, the plan calls itself an "exchange," even though there will be only one payer in the exchange. Many aspects of a state single-payer plan will have to make their own tactical adaptation. Good reason to dig into the details of Vermont's efforts now. Vermont is a very small state, with barely a million people. Other states, or even groups of states, could adapt single-payer plans with much greater economies of scale.
Fourth, Vermont also sets up a board of health care professionals and other stakeholder representatives - called the Green Mountain Care Board - that would review and approve designs for a publicly financed program available to all. State-appointed health care professionals and other stakeholder representatives will make up the board. In addition to design of the system details, the board will set limits on costs and promote both improved health outcomes and reduced overall per-patient costs. The Green Mountain Care Board will review proposals from executive branch agencies on how the program would work and be financed. By January 2014, it would set up the exchange, required by the federal Affordable Care Act. The exchange later would become the framework for the single-payer system.
Reactionaries call these boards "death panels." The truth is they will save and improve millions of more lives than the current real death panels - the insurance corporations that have an easy and profitable test for life versus death: the rich live, the poor die.
Opponents of the Vermont bill are issuing the usual screeds. "Three of the five doctors told us point blank that if a single-payer health care system comes to pass they will seriously consider relocating elsewhere in the U.S.," claimed state Sen. Randy Brock, R-Franklin. This is bull. Systems run on something besides the fee-for-service insurance system - like the Mayo Clinic - get better outcomes and doctors apply from all over the world to work there for good salaries and to perform real health care, not just health care for profit.
Vermont Gov. Peter Shumlin, in a statement released by his office, sounded optimistic about meeting the challenges, and positive about the importance of having a political health care debate that addressed the real challenges of health care - not smokescreens and paid stooge arguments from the insurance companies and their paid hacks.
"Today, the Legislature took a huge step toward making Vermont the first state ... in the nation to control skyrocketing health care costs and remove the burden of providing health care coverage from small business owners," he said. "This bill is good for Vermonters and Vermont businesses."