Sunday, 13 April 2014

Vermont's Answer to the Affordable Care Act: Treat State like a Big Buisness

In 2011 Vermont passed a bill creating Green Mountain Care, the first State run health insurance.  Its passage ushered in a new chapter in the health-insurance debate.  Asking for the first time in a long time, why is health insurance connect to employment?

"Green Mountain Care will use the federally-mandated Health Benefit Exchange infrastructure as a springboard, but it will be a completely new type of system.  The goals of Act 48 are to:

  • Improve the health of Vermonters
  • Reduce the rate of growth of Vermont’s health care costs         
  • Enhance the quality of care and experience of patients and providers
  • Recruit high-quality health care professionals to practice in Vermont
  • Simplify and streamline administrative and claims processes to reduce overhead and enhance efficiency"
Basically, Vermont is breaking the link between employment and health-insurance.  It is a great opportunity to see what American Single Payer Health might look.

Their big question is how to you raise the $2B needed to pay for it.  They know that Vermonters pay well over $2.3B/yr in insurance premium, yet they are afraid to ask Vermonters to pay some type of similar insurance premium/subsidy to a government run insurance program.  

One of leaders behind the bill explained how much more cost effective it would be for a company of the size of Vermont to self-insure and how every actuary and consultant would advise the move. Ironically, many health business executives shutter at the thought of a single-payer system.  Mainly due to the economy of scale that adjust the cost-benefit scale away from illness and towards health.  When the system is large enough and payed for in a closed loop, an increase in population health means decrease in overall health spending.  

As we enter the next generation of the fights in health-equity, Vermont might prove to be a great lab. The bill, in the very least, brings into clear view some of the hypocrisy of the current system.  

A great video explaining the current debate:

for a super wonky video: