Concerned about Health Reform? Pay attention to Vermont

The State of Vermont has taken steps to offer single payer coverage to all of their citizens. If the bill passes, and is signed by the Governor (both expected) then passes approval of the Health Care reform law, starting in 2015 all citizens of Vermont will be covered by Green Mountain Care, the State Health Plan.

Apparently nobody will need to purchase Health Insurance, as everyone will be covered by the State.

Here is what needs to be constructed. What is the level of benefits? How much will insureds have to pay for Doctor Visits, Prescriptions, and Hospital Visits etc.? It is realistic to expect that benefits will be income triggered. That is to say the poor will not be required to pay much while income earners will have some other level of responsibility.

How much will it cost and more importantly how will it be paid? Costs are argued, as the benefits haven’t been set up. The price of this program will be paid by taxes or required fees (another word for taxes). It is safe to assume that Employers will pay some and the rest will come from taxpaying individuals. It could come in the form of State taxes, property taxes, sales taxes or a combination of all three.

Will Doctors flee or stay? Jury is out on that one but a lot will depend on the level of compensation for procedures. It will have to be significantly more than Medicare or there will be a physician exodus.

Reading tea leaves is always imprecise, but right now it looks like the State of Vermont will launch the social experiment of universal single payer health care. Will it end up like Canada, with long waits and very high taxes? Will it be the relief and help that citizens need? Let’s wait and see.

For my friends with serious illness issues and restricted income, they might be looking at some way to establish Vermont residency. Imagine that many sick and financially strapped people established residency in Vermont. That would give them a higher percentage of claims without the payments. This could only drive the cost up. Will businesses and property owners in Vermont move out to avoid the taxes? That would create more cost exposure for the people who stay in the State.

Social experiments are always interesting. Like many well intended efforts, this one could be a financially ticking time bomb for the Green Mountain State. Stay tuned.
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