MONTPELIER - The 2012 Legislative session is only a week old and Sens. Vince Illuzzi, R-Essex/Orleans, and Hinda Miller, D-Chittenden, are working on a bill that would make some changes to the healthcare reform bill enacted into law last year.
Illuzzi is concerned the 2011 law, which sets up the federally required health exchange, will effectively eliminate all but one insurance provider, leaving only Blue Cross and Blue Shield of Vermont. Other private companies that have substantial health insurance businesses in Vermont, MVP and CIGNA, would most likely be forced out of the state.
According to Illuzzi, the Shumlin Administration said the different companies have to be collapsed into one so the state will set the stage for a single payer system. "The governor says the health exchange can be used as a stepping stone to single payer," Illuzzi said. "That creates uncertainty and concern in the business community. My argument is that it's not necessary to do that because what we're doing is destroying the private insurance market we now have in place. Until we're ready to implement single payer, we really should leave those insurance plans that are working up and running."
Illuzzi's proposed bill allows the Health Exchange to comply with federal law but take advantage of different options like allowing companies to continue to use health savings accounts (HSAs).
An HSA allows an employer to purchase a high deductible plan from an insurance company, Illuzzi explained. An employer may offer a plan with a $10,000 deductible, but in turn put $10,000 into each employee's health savings account. This type of plan would not be expensive and the money that companies put into a health savings account is a business deduction. "There are benefits on both sides."
However, the law Vermont legislators passed last year "all but makes HSAs unlawful in Vermont, because it doesn't allow plans to be sold at the bronze level."
Illuzzi also said lawmakers have found that companies with at least 50 employees have done a good job at managing health premium costs by providing healthy life style initiatives, preventative programs at no charge to the employees and encouraging employees to take part in preventive exams and testing. These types of plans "save the employer money and keeps insurance premium increases at below average," the senator said.
The healthcare reform bill legislators passed last year only allows insurance to be sold on the Health Exchange, which means the policy holder will have a plan with defined benefits, something some employers may not want. Some may want different benefits, more benefits or less benefits.
If insurance is not available off the exchange, employers can't tailor their plans to their employees' needs, Illuzzi said. "We're proposing that be authorized."
The issue around Essential Health Benefit Package, said Illuzzi, is to ensure whatever benefits are mandated in the state plan don't end up costing employers and employees more money than what they currently pay. Illuzzi wants to make sure Vermonters don't have more expensive and less available healthcare.
According to Illuzzi, some medical specialists have threatened to leave the state if their reimbursements are further decreased. Vermont Medicaid now cost shifts expenses to the private sector insurance companies. "What if the private insurance companies are no longer doing business in Vermont?" he asked.
"We have to be careful that we don't disenfranchise the specialists who are in the state," Illuzzi said.
"Everybody wants the best medical care for themselves and their family, but when you look at the numbers, the way you cut back costs is to cut back on benefits, reduce the number of doctors and reduce the number of preventative tests like MRIs."
Other states that have already enacted the Health Exchange, like California, Maryland and West Virginia, have done so in a way that offers several carriers, several plans and insurance can be purchased off and on the exchange.
"The other states have increased opportunities for employers and individuals," Illuzzi said. "In Vermont, we're decreasing options and essentially corralling everybody into one plan and, in my judgment, one size doesn't fit all."
The Vermont Chamber of Commerce Stated in a press release:
As the Legislature moves forward in making key decisions regarding Act 48, the state's health care reform bill enacted in the 2011 session, the Vermont Chamber will be advocating for more choice for employers in this new marketplace. The key decisions being discussed and debated this year will be the size of businesses, essential health benefits, types of plans and the off-exchange market.