Today Vermont Governor Peter Shumlin signed a truly historic law that will put Vermont on the path towards being the first state in America with a progressive and unified health care system.
The goal of the Vermont law is to integrate all the pieces of America’s byzantine health insurance system into one system overseen by the state, and to achieve the benefits of single payer. This universal, publicly financed system will be called Green Mountain Care.
While the law puts Vermont on the path to achieving this goal, there are still some major hurdles. By 2013 the state will need to decide on revenue sources to pay for some parts of it. An integral part of addressing the funding issue will be the need for multiple waivers from several federal laws that will allow the state to fold the administration and funding of federal insurance programs into Green Mountain Care.
Some of the potential waivers include:
- Medicaid waiver
- SCHIP waiver
- Waiver to locally manage traditional Medicare
- Medicare Part D waiver to include seniors in single drug formulary for the state
- Waiver from some workers compensation laws
- Waivers for multiple provision of the Affordable Care Act
The more favorable terms of the the waivers, the better Vermont will be able to fund the program and increase efficiency by streamlining the system in the state.
While waivers from many of the provisions of the ACA need congressional approval, others are at the discretion of the Department of Health and Human Services. HHS has been granting waivers freely to corporations like McDonalds that want to offer worse coverage to their employees than the ACA mandates. They’ve also been granting waivers to states seeking lower medical loss ratios, which basically allows them to offer junk insurance on the exchanges.
Under current law, it’s not possible to get waivers from the exchange/tax credit provisions of the Affordable Care Act until 2017 unless the Congress passes the Wyden-Brown “Empowering States to Innovate Act.” This will likely be what delays Vermont from fully realize its goal until 2017. But the other federal waivers are equally if not more important to the plan’s success.
For example, Medicaid and Medicare cover roughly 35 percent of people in the state, while the individual exchange created by the ACA will likely only cover about 5 percent. Since the goal of the Vermont plan is to produce greater efficiency by centralizing, standardizing, and simplify the administration of the health care system, the more people that can be brought into the new unified Green Mountain Care plan,the better it will function. If HHS does not grant those waivers, it will leave a third of the state outside the plan and it will serious hamper its effectiveness.
Getting waivers from HHS is going to be an important part of any state plan to implement their own system. And President Obama has already expressed his support for allowing states to begin receiving waivers from the ACA in 2014 rather than waiting until 2017. That’s why FDL is joining with PNHP to ask HHS Secretary Kathleen Sebelius to commit to granting Vermont the waivers it needs to make Green Mountain Care the best program it can possibly be for the people of Vermont.