June 24, 2018
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Meanwhile, Vermont moves toward single-payer

The how-to-fix-health-care debate is beginning to resemble a pinball machine here in New England.

Massachusetts in 2006 instituted a mandatory health insurance system under then-Gov. Mitt Romney, a Republican who is now running for president (and running away from the insurance mandate he enacted). The Massachusetts plan provided financial assistance to those earning up to 300 percent of the federal poverty level in buying insurance.

Then in 2010, President Barack Obama and the Democratic-controlled Congress adopted a plan that in part replicated the Bay State approach. The Affordable Care Act requires people to have health insurance, blocks companies from denying coverage and empowers states to create exchanges which seek market competition for coverage.

This spring, Maine and Vermont, two rural, northern New England states, have taken bold steps in seemingly opposite directions.

Republicans in Maine recently enacted a plan that makes the playing field more friendly for health insurance companies. They believe, though, that the component of LD 1333 allowing people to purchase insurance from other states will drive down prices. Their plan also moves high-risk people out of general insurance pools, and helps insurance company bottom lines by taxing policy holders to fund the high-risk pool.

Meanwhile, in Vermont, the state government has enacted a plan that is closer to the vision the Clinton administration had for health care finance reform in the early 1990s.

The Vermont plan establishes a health insurance exchange, which the Obama plan mandates. The Vermont version would publicly finance that exchange, and make it available to all state residents. The plan is close to the single-payer plan in which the government collects tax revenue and pays claims, but since it allows individuals to purchase supplemental insurance or keep their private insurance (about 20 percent of residents have such insurance), it falls short of that purely public model.

Vermont has seen big jumps in the cost of health insurance, in part because the state has for some time mandated that insurance providers cover any applicant, regardless of health.

But the difficult part lies ahead for Vermont, as legislators have yet to agree upon a plan to raise revenue to pay for the exchange. A five-member panel has been charged with finding a method.

There are cheerleaders and scoffers on both sides of all the approaches that seek to lower health insurance costs. Sadly, there is no mathematical formula with which the benefits of one approach over another can be measured. Rather, each approach contains assumptions and predictions, and each will create winners and losers.

The Maine and Vermont plans, though, bear watching to see if one approach eclipses the other for efficiency and fairness.

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