Much Anticipated Health Report Recommends Single Payer System

01/19/11 5:50PM By Bob Kinzel
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AP Photo/Toby Talbot
Harvard health care economist William Hsiao is greeted by Gov. Peter Shumlin and Speaker Shap Smith on Wednesday in Montpelier.
(Host) A much anticipated report recommends the implementation of a single payer health care system in Vermont in 2015.

The report says the system will save hundreds of millions of dollars that can be used to expand access to all Vermonters.

VPR's Bob Kinzel reports:

(Kinzel) Dr. William Hsaio is the Legislature's special health care consultant and he's been studying Vermont's system for months.  His conclusion is that the state's current system is broken and in need of major changes.

(Hsiao) "We conclude the broken system can be fixed and can be fixed through a single payer system because a single payer system can produce significant savings in health care costs for Vermont."

(Kinzel) Hsiao says converting to a modified single payer system will save hundreds of millions of dollars in administrative costs. He says these savings can be used to provide universal coverage.

(Hsiao) "You can use that savings to fund those who are uninsured and those who do not have enough insurance bring them up to a standard."

(Kinzel) Under the plan, most employers and employees would pay for health care through the imposition of a new payroll tax and Hsiao says the proposal will not increase current costs.  In return, he says everyone would receive an "essential" benefits package that would be better than the coverage that most Vermonters have today.

Hsiao says the government wouldn't actually administer the system - instead these services would be put out to bid to private insurance companies.

Governor Peter Shumlin says he's very encouraged by the report.

(Shumlin) "I think that Vermont can be the first state in the country that passes a sensible health care plan that provides access to all Vermonters, that's affordable and provides quality care...and he has given us the most comprehensive plan to get it done that I think any state has ever seen."

(Kinzel) The Hsaio report says moving to a single payer system will help create 5000 new jobs over a number of years - Shumlin agrees.

(Shumlin) "Many businesses will want to do business in Vermont. It's going to save us money, it's going to provide quality care and it's a jobs creator."

(Kinzel) Members of the business community are urging lawmakers to take a long, hard look at this report before taking any action.  Betsy Bishop is the President of the Vermont Chamber of Commerce.

(Bishop)

" I think that we need to make sure that we understand how that will work and the impact that it has on our employers here in Vermont and how that impacts us as businesses operating in a global market."

(Kinzel) The Hsiao report also exempts several large groups of employees from the single payer plan including big companies that self insure their coverage and businesses with less than 10 employees. This could represent as many as 30% of all workers in Vermont and it raises a lot of questions for Bishop.

(Bishop) "My question then would be who is in the single payer system?  I, at this point, have a lot of questions about the report."

(Kinzel) The House and Senate Health Care committees will now closely review this plan over the next few weeks.

For VPR News, I'm Bob Kinzel in Montpelier.

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health_reform vermont_legislature politics
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