Nearly two months into the legislative session, the scene at the Statehouse remains unusually slow.
It’s the calm before the storm.
Next spring, if Gov. Peter Shumlin gets his way, the legislature will vote on a historic, expensive and politically perilous bill to finance the governor’s long-sought goal of providing universal health insurance.
But to get there from here, he’ll need a legislature that has his back. That’s why the state’s biggest union — the Vermont-National Education Association — pledged last week to reinvigorate a dormant political advocacy group called Vermont Leads.
“Vermonters already support the creation of Green Mountain Care,” says Vermont-NEA spokesman Darren Allen. “Our goal is to let lawmakers and the governor know there’s support for what they’re doing.”
They might need to hear it. After last fall’s rocky rollout of Vermont Health Connect — a byproduct of the federal Affordable Care Act, or Obamacare — some lawmakers may be hesitant to follow through on yet another major health care overhaul.
“I’m concerned that there’s not as much support for this as you might hope, but it’s still early in the discussion,” says Peter Sterling, a veteran health care activist who recently resumed his duties as executive director of Vermont Leads. “My biggest worry is that the entire discussion becomes about a tax bill, as opposed to, ‘What does this tax bill do for Vermonters?'”
Along with losing the faith, Vermont Democrats could also lose some seats this November. The long-moribund Vermont Republican Party appears intent on recruiting better legislative candidates than usual, earlier than usual. State GOP political director Brent Burns says the party’s already signed up six challengers to run for the Senate — including former party chairwoman Pat McDonald in Washington County and 2012 runner-up Dustin Degree in Franklin County — and 22 for the House.
“For the financing plan to be passed in the next legislature, [Democrats] have to hold their ground or increase their majorities — and that is severely under threat,” says Vermonters for Health Care Freedom founder Darcie Johnston, a staunch opponent of single-payer. “That’s why you’re seeing these big, out-of-state unions step up to protect this agenda.”
In fact, those unions haven’t ponied up all that much — at least, not yet. As Vermont Public Radio’s Peter Hirschfeld first reported last week, the Vermont-NEA’s parent organization dropped just $80,000 to fund Vermont Leads for the next six months. It also paid $35,000 for a poll to gauge popular support for single-payer.
But that might just be the tip of the iceberg.
“We fully expect other groups will lend their support to this effort,” Allen says, adding that his organization has had “conversations” with other unions about funding the effort.
One hint could be the recent addition of George Lovell to Vermont Leads’ board. Lovell serves as Vermont coordinator for AFCSME Council 93, which won an election last summer to represent more than 7,000 home-care workers. In September, he was elected president of the Vermont AFL-CIO.
Lovell says it’s “too early to comment” on whether AFSCME or the AFL-CIO will invest in Vermont Leads this election cycle. But, he says, “I can tell you there’s lots of support.”
Ironically, it was AFSCME’s unsuccessful opponent in the race to represent home-care workers, the Service Employees International Union, that actually founded Vermont Leads.
As it geared up in the summer of 2012 to fight for legislation allowing those workers to organize in Vermont, the out-of-state SEIU created the group to curry favor with local lawmakers. It spent more than $100,000 on pro-single-payer advertising that summer and another $50,000 that fall supporting candidates through an affiliated political action committee. After the SEIU lost its organizing bid, the union left the state and Vermont Leads went dark.
Sterling says he expects Vermont Leads to relanch its PAC, which could operate as an independent, expenditure-only “super PAC,” as it did last year, allowing it to raise unlimited sums from a single source.
That could turn out to be a very big deal if Democrats and Progressives face more than token opposition this fall. Or if deep-pocketed single-payer opponents — such as Burlington mega-donor Lenore Broughton or out-of-state business groups — try to stop Vermont before it becomes a national example.
If the unions save the day, you can bet they won’t let their friends in the Statehouse forget it.
$14 Million Question
When Shumlin delivered his budget address last month, the governor promised for the umpteenth time that he would not raise broad-based taxes this year.
Of course, as reporters — and defenders of the English language — are fond of noting, “broad-based” doesn’t actually mean “broad-based” in governor-speak. While the Oxford English Dictionary defines the term as “wide-ranging; general,” Vermont governors past and present have limited the definition of “broad-based taxes” to those targeting income, sales, rooms and meals.
And so it was that Shumlin felt he kept his promise last year, despite supporting a gas-tax increase most Vermont drivers surely felt was pretty broad-based. And so it is this year, now that Shumlin is attempting — for the second year in a row — to plug a hole in the state’s health care budget with a $14 million tax increase on health-insurance claims.
As Shumlin noted in his budget — but not in his budget address — his administration hopes to double the 0.8 percent tax the state bills health insurance companies for every claim filed. But as critics point out, insurance companies are quick to pass that tax along to the broad-based public, who end up paying higher premiums.
“The logic of it doesn’t work for us,” says Rep. Janet Ancel (D-Calais), who chairs the tax-writing House Ways and Means Committee. “If we’re trying to keep health care costs down — and particularly premium costs — why would we want to do something that would increase premiums?”
When Shumlin pitched a similar plan last year, Ancel’s committee rejected it. This year, she says, “Though we haven’t taken a vote, I would say the general feeling really hasn’t changed.”
Robin Lunge, Shumlin’s director of health care reform, says it’s true that, “On its own, [a claims assessment increase] would create new pressure on premiums because it does get passed on to consumers.” But the administration is also pushing to increase Medicaid reimbursement rates to providers by 2 percent, which she argues will reduce a cost shift to consumers that also ends up being pretty broad-based. Enacted in tandem, she argues, the two changes would not hurt Vermonters.
Ancel’s counterpart in the Senate, Finance Chairman Tim Ashe (D/P-Chittenden), has yet another idea.
Ashe released a memo this week with the title “‘Fair and Reasonable’ for Whom?” in which he argues that a broad base of taxpayers is unfairly subsidizing large employers that don’t offer health insurance to their employees.
When the legislature created Catamount Health in 2006, he writes, it required that employers pay a “fair and reasonable” amount for every employee to whom it didn’t offer health insurance. That rate now stands at $476 a year — less than a quarter of the $2,164 it costs the state to insure each Medicaid recipient. The balance, Ashe argues, is borne by taxpayers.
According to data Ashe acquired from the tax and labor departments, the 10 retailers and grocery stores that operate at least one store in Vermont with 100 or more employees pay a collective $904,000 through the employer assessment. Taxpayers foot the remaining $4.1 million billion to insure those 10 companies’ employees.
If the administration is looking for another $14 million to pay for health care programs, he says, he’s more inclined to ask the state’s largest employers.
“I don’t think it’s fair,” he says of Shumlin’s proposed claims assessment hike. “I believe that the growth in subsidized health care shouldn’t once again be paid for by all businesses and all taxpayers, but that maybe it’s time to look to the non-insuring employers to pay a more fair share of the cost.”
Ready, Aim … Vote
Could the results of Burlington’s vote next week on a trio of charter changes influence the statewide debate over Vermont’s gun laws?
Two groups fighting on either side of the issue sure seem to think so. Both Gun Sense Vermont and the Vermont Federation of Sportsmen’s Clubs have engaged in the Queen City duel, investing money and volunteers to make their respective cases.
At issue are three separate resolutions that would ban guns from bars, require them to be stored under lock and key and allow law enforcement officials to confiscate them from those suspected of domestic abuse.
Gun-rights supporters say the charter changes, which would have to be approved by the legislature and signed by the governor, would shoot a hole right through a 1987 state law barring municipalities from restricting gun rights.
“This is such an incredibly slippery slope,” says VFSC acting president Chris Bradley, who worries that other towns and cities could follow Burlington’s lead, thereby creating a “patchwork” of laws. “There is a preemption clause, and there’s a reason for it.”
Gun-control activist Ann Braden, who cofounded Gun Sense Vermont, agrees that next Tuesday’s vote “has statewide implications,” but for a different reason.
“We want to make it clear to the Statehouse that when voters are given the chance to vote, they support this,” she says.
While Braden’s group had hoped to make a serious push for new gun laws this session, it now plans to hold off until next year, when Braden thinks recently reelected legislators will be less nervous about tackling such a hot-button issue. At that point, the group hopes to focus its energies on strengthening the state’s background check-laws.
For now, between 25 and 30 Gun Sense members are focusing on canvassing and phone-banking in support of Burlington’s ballot measures each weekend, according to organizer Marie Adams. The group has raised $1,436 and spent $1,833 on its Burlington advocacy — much of it on advertising, including in Seven Days — according to a recent filing with the secretary of state’s office.
That’s far less than the $20,100 VFSC has raised and the $15,563 it’s spent. The pro-gun group has dropped $3,232 on lawn signs and more than $12,081 on radio ads, according to its filing.
Notably, one of the Sportsmen’s Federation’s biggest individual donors is an infamous sportswoman: conservative donor Lenore Broughton, who contributed $1,000 to the cause.
The Burlington Free Press has also joined the club, opining against the domestic violence-related charter change in a recent editorial.
“The change on the Town Meeting Day ballot is overly broad and allows confiscation without requiring formal charges or proof that the weapons present an imminent threat to persons,” editorial page editor Aki Soga wrote.
Burlington Mayor Miro Weinberger sees it differently, calling the proposals “important steps to take for public safety in Burlington.”
But the mayor declined to put the might of his political action committee, called Partnership for Burlington’s Future, behind the measures, saying the PAC “was created to advocate and organize on fiscal issues and waterfront investment issues.” So far it’s spent $5,397 on Burlington’s non-gun-related ballot initiatives.
Nevertheless, Weinberger says he’s been speaking out in support of the gun proposals in newspaper columns and neighborhood meetings, and he says his volunteers will help Gun Sense distribute their fliers this weekend.
Because the charter changes would require Statehouse approval, Weinberger argues that passage would initiate an important conversation in Montpelier that could set the table for Gun Sense’s proposed universal background check advocacy.
“I think that discussion is coming,” he says. “I think Burlington having a strong vote on these will impact that policy.”
Disclosure: Tim Ashe is the domestic partner of Seven Days publisher and coeditor Paula Routly.
This article appears in The Sex Issue 2014.
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Devastating Diagnosis – Green Mountain Care 2017
a prognosis by H. Brooke Paige
Vermont (January 2017) – Peter Shumlin’s socialist dreams of “universal, single payer healthcare” have mutated into a nightmare over the past five years. The utopian dream of healthcare for all was never properly explained nor fully understood by Vermonters. The working poor thought that it would be the “free care” that they saw those on welfare receiving. Most believed the promises that their healthcare providers and the level of care they were receiving would somehow continue – while the cost of care would be greatly reduced through streamlining and controls that the state and federal government would impose. Those who worked for large employers and government believed they would not be effected. None of these assumptions would prove to be correct.
Green Mountain Care (GMC) quickly acquired the resources of Vermont Blue Cross and Blue Shield (BCBS) as most of its insured became GMC clients. In the early days of the rollout, GMC and its promotional website Vermont Health Connect (VHC) failed to deliver healthcare for the small group of self-insured and the employees of small businesses targeted as the first clients of GMC. Governor Shumlin and his loyal minions on the Health Care Board, lead by a Burlington restaurateur, had no understanding of the healthcare insurance industry and were unprepared to handle even the most modest problems as they arose. While the Federal Government abandoned their hapless website contractor CGI-FEDERAL, Shumlin regrettably decided to continue with them “throwing good money after bad” eventually spending over $100 million of state and federal funds with CGI on a system that was politely described as “leaving a lot to the imagination” of the users. The plain truth was that the CGI system would never work – despite months of “tinkering” and additional monies wasted, the VHC website never reliably allowed users to: create accounts or access them, employers to edit or update their accounts (if they had been patient and creative enough to create one) nor could the system collect premiums and in the end could not pay for health care services incurred by its “insured” clients. In the end CGI was abandoned and the BCBS operating system, by default, became the GMC system.
Vermonter’s healthcare system is an unrecognizable husk of the quality network they enjoyed just a few years ago as the politician’s grand scheme, GMC, has decimated Vermont’s hospitals and healthcare practitioners – as well as the state’s economy at large. It is sad that there was no way, back in 2012, to foresee the full consequences that the progressive plans, designed by inexperienced, insistent social architects with big ideas but no understanding of the complexity of the healthcare system or the health insurance industry that financed it.
As the GMC system sputtered to life in 2014, many providers chose not to participate as a result of the anemic 105% of Medicare reimbursement rates which barely covered their out of pocket costs and failed to contribute toward overhead or capital investment costs. Within a year 20% of practicing physicians and specialist had retired, moved out-of-state or decided to limit themselves to “fee for service” patients. Nearly 50% of Vermont’s Oncologist and Cardiologist declined to participate in the GMC program. To fill the void, the Vermont Legislature hastily authorized nurse practitioners and LPNs to act as primary care providers without direct supervision.
Today, Vermonters receive their healthcare treatment and pay for services in ways unimaginable just a few years ago. For GMC participants who have their treatment denied by the GMC Review Board and those who have decided to pay the penalties instead of participating have found that many providers offer deep discounts for cash payment for services rendered. There are now many “fee for service” care facilities including: MedExpress, UrgentCare, Got-A-Doc, LabCorp, and Dynamic Therapy that offer extensive portfolios of services for walk-in patients on a first-come-first-served basis. Patients pay for services when rendered by cash or credit card with financing arrangements available for more extensive and costly procedures. While these new facilities, at first blush, seem questionable; most are staffed by highly competent and experienced practitioners (many are those that chose not to participate in GMC) and provide quality care. For those on a budget or in a hurry, Doctors on Call provides internet and phone consultations on routine and minor medical concerns, allowing many to resolve their medical issue on their own. Additionally, there are “premium” service providers like Concierge Medical which handle all the details for the medical needs of the wealthy – lining up the best doctors, treatment facilities and even arrange transportation before and after treatment, truly door-to-door service.
Possibly the most destructive aspect of the Green Mountain Care program has been the state’s scheme for financing its ever escalating costs. Governor Shumlin, for several years, obfuscated and then flatly refused to reveal the amount and sources of the funds required to finance GMC’s operation until well after his reelection in the fall of 2014. That December, the Governor finally revealed the three-pronged taxation plan required to generate the $2.9 billion necessary to fund GMC – including: 1 – a 25% payroll tax with employers paying 17.5% and employees having 7.5% deducted from their paychecks (the self-employed are required to pay the entire 25%), 2 – a 10% tax on all unearned income – capped at $200,000 per year and 3 – an increased healthcare claims tax raised from 7% to 14% – this tax, formerly paid by insurance firms, is now paid by the patients receiving the care. As soon as the Governor had announced the requirements of the “GMC taxes”, employers implemented plans to “scale back” their Vermont operations or leave the state in order to remain profitable. By summer of 2016; new layoffs in Vermont totaled over 15,000, including nearly a thousand from the healthcare industry as they scaled back in anticipation of reduced revenues from GMC.
Hospitals and medical providers, desperate for additional revenues, began to increase fees for services rendered in patient categories not covered by GMC, primarily: workman’s compensation injuries, auto accident victims and personal injuries paid for by liability insurance claims. Insurance providers immediately adjusted their rates to their insured by as much as 25%, worsening Vermont’s economic and business environment.
Vermont’s healthcare subsidies encouraged many lower wage earners to quit their jobs and sign-up for the broad spectrum of available social service benefits, since the new healthcare taxes in addition to state, federal and Social Security taxes resulted in significantly lower take home pay, insufficient to cover their living expenses.
Former Governor Shumlin had narrowly won reelection in 2014, in part because the impact of his Green Mountain Care and his ultimate prize of “single payer” were not fully understood. By 2016, Shumlin had realized that he had little chance of winning another gubernatorial race and attempted to best incumbent Senator Patrick Leahy in the Democratic Primary – failing by a wide 3:1 margin.
Ever the opportunists, Shumlin and his brother, Jeffery, refocused their Putney Travel Service to take advantage of increased interest in “medical vacations” brought on by healthcare treatment delays and denials by GMC. Putney Medical Vacations will soon provide complete packages that allow their wealthy customers to avoid the delays and the reduced quality of care in Vermont by arranging treatment “stays” in exotic venues that include: Bermuda, Costa Rica, Bangkok, Mexico and Cape Town where patients can save up to 70% under the expert care of orthopedic, oncological, plastic or general practice surgeons and enjoy recovering on the sun-soaked beaches of the treatment venue.
Governor Scott and the newly elected Republican Legislature are struggling with the consequences of GMC. Vermonters who cannot afford to avail themselves of “fee for services” treatment find long waits at the “public” hospitals – the state has been required to take over the operation of most of the formerly independent institutions, closing several smaller hospitals to control costs. Appointments for non-emergency hospital procedures now require waits of three to five months once they are approved by the GMC Board.
All of this could have been easily avoided. The initial concern over 40,000 uninsured Vermonters was discovered to be a gross exaggeration. When those who wished not to be insured (primarily the wealthy and young individuals) and those who chose to find care through social services (at the taxpayer’s expense) were eliminated from the equation , the actual number of uninsured individuals who wanted insurance coverage was less than 9,000. The biggest problem was that none of those involved in the planning of GMC had a thorough understanding of healthcare insurance or the financial tightrope that these firms walked to successfully balance the costs of care and premium rates while managing to remain financially viable. The “public financed” political/government alternative has proved to be a disaster of biblical proportions – out-of-control costs and radically insufficient care.
It is a shame that there is no way to reach back in time and inform Vermonters of the healthcare troubles in their future.
H. Brooke Paige, a historian and writer, is a resident of Washington, Vermont.
Devastating Diagnosis – Green Mountain Care 2017 as published in the WORLD, March 12, 2014