Deadline for health care financing plan a mercurial target for lawmakers

Deadline for health care financing plan a mercurial target for lawmakers

It happened on several occasions throughout the legislative session, first with the budget and then with a health care reform bill.

House Republicans tried, but were unable, to put a deadline in statute for Gov. Peter Shumlin to deliver a financing plan for Green Mountain Care, Vermont’s planned universal health care program.

They argued that the governor failed to deliver in 2013 when Act 48, the state’s health care reform law, called for a financing plan, that Shumlin was waiting until after the upcoming election to release his plan and the resulting uncertainty was hurting businesses in the state.

Then a curious thing happened. Democrat Mike Fisher, chair of the House Health Care Committee, amended the Senate-passed health care reform bill to include a deadline for the delivery of a financing proposal in early 2015.

Unlike the previous statutory deadline, this one came with a penalty. It would have frozen the administration’s remaining planning and implementation money until the plan was delivered to lawmakers.

Rep. Mike Fisher, D-Lincoln, chairman of the House Health Care Committee, hears testimony at the Statehouse in Montpelier. Photo by Roger Crowley/for VTDigger

Rep. Mike Fisher, D-Lincoln, chairman of the House Health Care Committee, hears testimony at the Statehouse in Montpelier. Photo by Roger Crowley/for VTDigger

“The clock is running out,” Fisher said in April when the bill was being revised in his committee, adding that the administration needs to deliver early next year for the program to be viable.

The shift wasn’t enough for Republicans, who pointed out that the plan, which is expected to detail a roughly $2 billion tax increase to fund the program, will still come after the mid-term election, allowing supporters of the program to avoid taking ownership of its specifics.

In the waning days of the 2013-2014 legislative session, the deadline that Fisher and the Democratic supermajority in the House approved disappeared from the final bill. It was removed during negotiations with the Senate, Fisher said.

“We put it back on the table,” he said. “They came back without it and made it clear they were not interested in it.”

Sen. Tim Ashe, D/P-Chittenden, said in an email Tuesday that the deadline approved by the House could have derailed the program.

“The House language would have cut funds for health reform positions if a deadline wasn’t met, but the need for the plan would have remained without the staffing to produce it,” Ashe wrote. “I think the Senate position is that if we don’t make a decision one way or another on health care financing next year it’s a major problem.”

Senate and House lawmakers who were part of the negotiations said the administration did not pressure them to drop the deadline.

Though the governor has eschewed deadlines when it comes to health care reforms, Robin Lunge, director of health care reform, said the administration was “comfortable” with the Jan. 15 deadline the House had included.

Shumlin has made it clear that he does not intend to release a financing plan until the administration has done its job thoroughly and completely, she said, but she expects the plan will be delivered to lawmakers and the public early in the next biennium.

“That’s our target and we’ll see how it goes,” she added.

Fisher said there is a perception that Green Mountain Care must launch in 2017, which stems from that being the earliest date a state innovation waiver to the federal Affordable Care Act could be implemented.

“The Legislature needs to do its own analysis of the impact of any financing plan on businesses and the health care system as a whole,” Fisher said. “We can’t be rushed, we have to take our time to understand it.”

Even if that means delaying the program’s launch beyond 2017, he said.

Concerns have been raised that moving forward with Green Mountain Care in 2017 will be essential to secure a federal waiver from a friendly Obama administration, but Lunge said that’s predicated on a misunderstanding of the waiver process.

She said the waiver can be granted at any time, but the changes allowed by a waiver can’t be implemented until 2017 because of how Congress wrote the Affordable Care Act.

The Obama administration is still designing the waiver process, and is working closely with Vermont on its application, Lunge said. She added that she’s confident Vermont will get a waiver from the current administration.

Even if a Republican is elected president in 2016, or any candidate politically opposed to Vermont’s single-payer push, it would be unlikely they would rescind a waiver once it’s been granted, she said.

“All waivers have a termination provision, but it’s rare because that goes against the whole concept of states as the laboratory of democracy,” Lunge said. “It would be atypical for an administration to pull a waiver for political reasons.”

As for the impact of the uncertainty surrounding the program’s details on Vermont businesses, Lisa Ventriss, president of the Vermont Business Roundtable, said that is a “very legitimate concern.”

Ventriss is a member of the governor’s Business Advisory Council on Health Care Financing. She described the 21-member group as representing a geographically diverse mix of small and large business owners.

From her perspective as a member of the council, she said she believes the administration simply isn’t ready to release its financing plan, as the governor has said, but that doesn’t mean the uncertainty isn’t affecting the state’s economy.

“When a business wants to grow its workforce or invest in new technologies, they want to know what their costs are going to be,” Ventriss said. “So when there’s a major cost with a question mark next to it, they’re less likely to make those kinds of investments.”

The Vermont Business Roundtable is composed of 100 CEOs representing the state’s “most active and committed businesses and employers,” according to its website.

When the organization recently surveyed its members, the results showed their outlook on Vermont’s business environment was positive, Ventriss said. But when they were asked what keeps them up at night, more than half gave comments relating to the rapidly changing health care landscape.

Vermont has decided to make an enormous shift in health policy, and her organization has decided to support it, but whether decoupling insurance from employment is a good thing for businesses is a matter of perspective, Ventriss said.

“For some businesses, they want to be done with this. It’s a burden and a cost they’ll be happy to turn over to the state,” she said. “Other businesses, and many of our members, view providing health care benefits as a covenant with employees. It’s important to recruitment and retention and a significant part of overall compensation.”

The business community should take comfort that the administration is taking its concerns seriously, Ventriss said.

She pointed to the state’s willingness to incorporate aspects of the consulting firm Avelere’s report into their cost projections.

The administration has also listened to concerns raised by the group that commissioned that report, the Vermont Coalition for Health Care Reform, a business and health care provider group that includes the Business Roundtable and the Vermont Chamber of Commerce.

As to whether the program will ultimately make Vermont more attractive to businesses, as the governor has suggested, Ventriss said it’s still too early to tell.

There’s still too much uncertainty.

All eyes will be on the Legislature next session as they hammer out laws that will define what health services Green Mountain Care’s benefit package will cover, and how to pay for it — as well as myriad other niggling policy details that could have broad implications for the program’s viability.

Morgan True

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  • Cynthia Browning

    It is important to point out that health insurance can already be separated from employment under the Affordable Care Act. Any business that does not want to continue to offer health insurance can stop doing so and workers can get insurance in Vermont Health Connect — some may qualify for subsidies. I believe that the business would then pay an assessment of something like $450 per employee per year as a contribution towards the health insurance system.

    Also, to the extent that the publicly financed Green Mountain Care program contains a payroll tax, that financing burden will remain on businesses, even if they no longer manage the programs.

    Uncertainty is the worst possible thing for long term strategic investments. In my opinion the policy and tax related uncertainty associated with GMC could be negating any positive effects from all the other efforts by the state to support businesses. This is very unfortunate for Vermonters, and it all stems from the premature commitment to an undefined program.

    Rep. Cynthia Browning, Arlington

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