Today, Dr. William Hsiao presented to the Vermont legislature a draft proposal for three different health care systems for the state. They include:
Option 1 – government-run single payer
Option 2 -Â public option
Option 3 – public/private single-payer
(You can find the full report, presentations, and the statement from Hsiao here at the Vermont Legislative Joint Fiscal Office.)
The purpose of all three designs is to expand coverage to all the residents of the state while controlling health care costs. All three options are designed to save more money and cover more uninsured than would happen under just the new federal health care law alone.
The report deals not just with the design of the potential systems, but also seeks to address the many legal hurdles involved in implementing any of the three options.
Of the three options presented in the report, the board recommended the state adopt option 3, the so called public/private single-payer option. From Hsiao statement to the legislature:
Beyond yielding greater cost savings, we believe Option 3 is most feasible because it is likely to be accepted by the broadest cross-section of Vermont stakeholders. In other words, we designed Option 3 to be both economically responsible and politically palatable. Through discussion with more than 100 stakeholders, we gained a critical understanding of what the various competing interests would tolerate, where they disagreed and where common ground could be reached. We focused on providing access to care, maximizing cost savings and where possible, relying on market-based efficiencies within a single-payer system. Political opposition to single-payer systems is often rooted in concerns over transparency and accountability. We designed Option 3 to address those issues and to operate with input from a broad base of stakeholders, with no one constituency holding total control. In sum, we believe that Option 3 provides benefits to patients, providers and the system at large in keeping with the goals of Act 128, with an eye towards long-term sustainability.
In the coming days, I plan to study the report carefully and provide more in-depth analysis.



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Wow! Great news.
Vermont leading the way.. Like the Green Mountain Boys did so long ago in the cause of freedom.. We now need freedom from oppressive medical costs and coverage for all..
Vermont is likely to have a huge migration soon.
H.R. 676 – Single Payer Medicare for all is the correct answer and I was born in Vermont.. Smile :-)
I don’t think there is a lot of room… tis a very small state ya know….
Don’t get too excited yet. They will need to pass it and more important get a lot of federal waivers.
These will be declared unconstitutional by the Robert’s Court under the double-super-secret
originalist interpretation of the 10th Amendment.
Good for them! I would prefer the single payer, but the single payer of private care giver is good as long as it does not cause large out of pocket for the insured.
not to meantion that there arent any jobs in Vermont.I lived there for 10 years. I loved it, even the 5 – 6 month winters ( although 2 years I lived there the temperature didnt rise above -10 F for daytime high, between Jan 3 and March 12. With avg nightime lows – 28 F )I got used to. But I had to leave to make a living.
Oh I won’t move to Vermont too frigging cold for me. I know I lived 1/2 my life back in new England… Just look up my moniker in Ma… Way too frigging cold BRRRRRRRRRRRR
I do know I lived in Maine for 5 years… One night -35 wind 50 MPH.. Dam house with furnace going full blast 48 fucking 48… I added a box stove after that winter.. Used to burn 5-6 cord of wood a year with a furnace running… No thanks… cold enough here in the Bay Area.. Besides I do get VA care…
I’d move up to New England in a second, regardless of the cold if I thought there was a job there for me.
I wouldn’t last a winter… shit getting old is a drag!!
Go Vermont! I recommend they go with option #1. I hope to see Minnesota and Washington State next.
One can only dream in Washington. Lot’s of progressives in favor of SP, but lots of budget cuts right now including healthcare services. What we really need is a robust national petition drive to force a ballot measure and thus force our elected officials to hear our voices instead of the healthcare industry.
Yes, I keep being told that states can’t pass single-payer plans because of the HC”R” bill. How does that work?
I think what we need is for a lot more politicians to lose their jobs because they haven’t fixed health care. They already know what we think and they don’t care.
Holy crap, Bill Hsiao is SHARP! Remember how everyone from the President on down made the “public option” the left wing of possible healthcare reforms?
Professor Hsiao makes the public option (“Option 2″) the right wing of his possible options:
Unlike Option 2, which continues a multiple-insurance system and Option 1, which incorporates a strictly government-administered, single-payer system, Option 3 proposes a single-payer structure overseen by an independent board with representatives of patients, providers, employers and responsible government agencies. Board members will be charged with establishing a budget for the single-payer system, determining the benefits package, and making adjustments to payment rates. Under Option 3, the Governor has discretion to veto decisions by this board. In addition to establishing an institutional board, Option 3 proposes a third-party to administer provider relations and claim processing function, awarded through a competitive bidding process. Both public and private entities will be eligible to submit proposals for this work. (emphasis added)
He calls his Option 3 a “public-private partnership”, a beautiful use of a term that politicians usually reserve for sweetheart deals with govt contractors. The independent board to oversee the healthcare system is genius, it takes medical care out of the grubby hands of the legislature. the use of a nonpartisan board of worthies shortcircuits the lobbyists usual games and the use of a dedicated payroll tax (hey, like Medicare is) means it can be funded independent of the ordinary appropriations process. What’s more, the use of competitively bid third party provider relations and claims processing looks rather familiar, its how Medicare is administered! Until recently these third parties were called “fiscal intermediaries”, they’re now called “Medicare Administrative Contractors” (MACs).
MACs will serve as the primary point of contact for provider enrollment, Medicare coverage and billing requirements, and processing and payment of Medicare fee-for-service claims for Medicare providers’ respective jurisdictions.
In other words, Professor Hisiao framed Vermont’s choices as a 1. single payer, single administration healthcare system, call it the VA option (the VA actually administers its CHAMPVA system like this); 2. a weak tea corporate welfare solution that lets private companies capture rents that should be used to provide vision and dental to every citizen (hell, not even the VA offers dental care to most vets). This right-wing sellout of a healthcare plan, you can always hear Dr. Hsiao disdain, is called “the public option”; Option 3 could be called the Medicare option. Single payer thats privately administered by fiscal intermediaries and overseen by an independent board (like the Medicare Trust Fund would be if the cabinet secretaries were replaced by nonpartisan appointees).
Was Dr. Hsiao recently rescued from Colombian drug lords or perhaps was awoken from a long coma? In other words, is there any excuse short of public corruption that the White House did not hire Bill Hsiao and use THIS as the blueprint for healthcare reform? Its criminal how much better this plan is compared to Obamacare.
Jon, thanks. I’m skeptical Obama & team would have left such an obvious opt-out benefitting clients, not providers. I look fwd to your reading whatever you’ll share on the issue.
Good news. This is close to the plan I supported on a national level. Hopefully Vermont is not too small to implement it–they’re going to get huge blowback from specialist physicians who can easily move across state lines.
Good morning Doc. I guess in Vermont, there is the medical tourism option (Quebec being just over the border). :o)
In 2009, some Republican congressman proposed that any doctor caring for a Medicare, Medicaid or “public option” patient would be given the same federal tort immunity that VA and community health clinic docs have (the latter are nonprofit and not federal employees). The amendment’s rather obliquely worded, but that’s the gist of it).
http://www.scribd.com/doc/25552884/Murphy3962-105
Gonna take on the insurance industry, might as well hit them with both barrels. If Vermont passed a similar law to take on malpractice liability, what the state lost in paid claims would be more than made up by physician acceptance of lower fees (due to the elimination of both the expense of malpractice premiums and the risk of a medmal judgment that exceeds policy caps).
wtg vermont
True, but the good news is that we in Vermont have a super majority of Democrats/Progressives in both the House and Senate and a Democratic Governor who is a strong supporter of health care reform.
So far, the biggest question is not whether something will be done, but whether the public option or government run single option are a better choice than a government/private partnership.
Further,because (with a couple of notable exceptions like IBM) our economy has a strong small business and focus, there is wide spread recognition and debate over the cost savings and stability that this plan will bring to business.
Vermont will lead the way again.
Bravo to Vermont! Dr. William Hsiao, from Harvard, is considered a world class authority on public heath care systems. He helped Taiwan design their current government-run single-payer health care system. In the 90s, Taiwan scoured the globe in a search for a model health care system. In 95, they adopted Medicare USA as their model! Every Taiwanese is covered at a cost of approximately $20 a month – which includes a choice of traditional or modern medical treatment, no waiting lists(!), and even a dental program!
[Apologies for lack of a link - the URL is huge. For over 30 yrs. I have subscribed to a DC newsletter entitled Washington Spectator. If you go to WS's website - washingtonspectator.org - you can find an excellent overview of Taiwan's system. I'm sure the article is archived. The title of the article is "A Superior Health Care System without the Middleman," by Ian Williams, June 15, 2008. Just type in "Taiwan health care system" in the Search box at the site. Excellent article - highly recommended!]
Here’s where the liberal rubber’s gonna meet the reality road.
Bill Hsiao, in conclusion of his recommendation of Option III, listed who would benefit and who would be forced to make concessions: Most tellingly, as Option III was in part employer-supported, it would not be possible for two-earner households–wherein each worker had workplace-provided insurance– to opt only to pay for one family insurance coverage. The couple would have to pay the premiums for both coverages. Parenthetically, this was probably the status of the majority of onlookers at the State House yesterday.
I guess we’ll find out if higher-income families with health-care coverage options will become the target of the backlash campaign–Harry and Louise paying for Them to have medical care! Another giveaway!
Oh, and the other big concessionaries? No more health insurance companies could play in Vermont! That, of course, was the bestest part.
Thx, definitely I will check that site out. I remember reading a snippet about Taiwan (Jon?) and then – poof, it was gone!
I applaud Vermont.
But why haven’t they (or other Dem majority states) enacted single payer health care before now?
This is the way it should have been from the start, State by State.
And PA and CA who have single payer bills in their legislatures now. The latter has passed CA legislature twice and been vetoed by Arnold each time, else we might have had SP in 6th (or is it 8th?) largest economy on earth. Too bad Gov Brown has chosen to cut social services and medical benefits to save budget money rather than boost the SP bill which would save scads more money for the state. Sounds like he’s not a liberal anymore, or not as smart as he used to be, or has lost his political courage (or all three). Or maybe he thinks it’s too early to be so bold.