Healthcare Reform and Vermont Taxpayers

One of the benefits of living in a small community in the past is that when the neighbor’s barn burned down, friends and foe alike would gather and help get a replacement built, because everyone understood that the lightning bolt which hit the barn could just as easily struck them. And in the collective act of helping, new friendships would form, and old wounds would get a chance to heal as enemies worked shoulder to shoulder on a common task. These community building events are in short supply these days (though COVER Home Repair does a fantastic job in this area.)

In the current unrest over taxes in all forms there is, I think, a sense of throwing in the towel on going to barn raisings, especially as far as healthcare goes, up and down the line. Everyone is gaming the system, and the more firepower you bring to gaming it, the more you extract from it. Medical equipment and supply companies, pharmaceutical firms, big insurers all extract enormous profits. Hospitals under the gun game the system by having different prices for the same services depending on who’s paying (this is called cost shifting). Desperate patients hide assets to qualify for ‘free’ care. People who could make paying for health insurance more of a priority than, say, the annual trip to Vegas, don’t believing that they will be taken care of anyway (and they are right, emergency rooms have to take them in). Because so many are gaming the system, if you are paying for health insurance and you are lucky enough to have a good job and to own property, you are paying a huge amount into the health care system in the form not only of your own premium, but in wages your employer would otherwise be willing to pay you; in taxes at the local level that support town employee health care premiums, and school employee premiums (and all these premiums are higher than they need to be because of all the free riders, the higher costs of medical goods and higher hospital prices); higher state taxes for Medicaid, and state employee plans; federal taxes for Medicare, and federal income taxes for various government operated health programs including the VA.  I total it all up and in my case estimate I’m putting something like 20K into the pot each year, but I can’t pin it down, and that bothers me more than anything. Instead of feeling like I’m helping raise a barn, I feel like I’m playing 3-card monte against a street hustler.

The plans Dr. Hsiao unveiled in Montpelier last week offer a way out of this mess, at least for Vermonters. And some quick calculations indicate that there would be some immediate savings for town and school budgets in the form of lower premiums. I will be watching this develop carefully and making sure that the town posts models showing the effect of the changes for taxpayers in our town. Why? Because clarity about where our money goes is essential to feeling good about our tax-paying.

The proposal creates a genuine health-care system that would encompass all Vermonters and standardize the benefits across the board. Instead of constantly changing plans and premiums, we would get some certainty about what it cost us and what we’d be covered for. We’d all be in the same boat (and if you wanted you could go and buy a supplemental policy for even more coverage). This would, for example, remove the anger many have over teachers having better benefits than they. So it could, in the long run, give us a really special, objective, fact of statewide Vermont community that I believe would be very attractive to many small firms that in this day and age don’t need to be anywhere in particular. Hartford, with its proximity to Dartmouth, the interstates, a revitalized regional airport in Lebanon could become even more of a center for these high-tech firms.

I’ve said that regionalization is necessary. The proposal in front of the Vermont state government now is nothing less than regionalism brought to health care — a statewide system that can save tax dollars and build community.

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