The era of scarcity is not over in Montpelier, though as legislators gather for Gov. Peter Shumlin’s inaugural address today, the challenge of health care reform offers a crucial opportunity for coping with scarcity.
The Legislature and governor are facing a gap of $50 million to $70 million in the budget they will be crafting for the coming year. That comes even as legislators are trying to plug holes in the current year’s budget caused by lagging revenues and high costs for, among other things, the state’s battered mental health program.
These constraints are occurring at a time when austerity policies continue to limit the ability of the federal government to help out the states or to pursue policies to stimulate the economy. Thus, legislators will be forced to continue for another year the kind of budget-cutting exercises that have dominated the Statehouse since the onset of the economic crisis in 2008.
It is a gloomy picture except for the one endeavor that promises to bring much good in itself and also to ease the budget constraints that continue to impoverish the public sector. That endeavor is health care reform.
Later this month the Shumlin administration plans to unveil its plans for financing the new health benefit exchange, which is due to go into operation in January 2014, and also the single-payer system it hopes to have in place by 2017. These plans will be crucial pieces of the puzzle in getting health care spending under control, which, ultimately, will be the only way that government at the federal and state levels will be able to ease the crushing costs that are gobbling up an ever-increasing share of public revenues.
Already, officials working on the health benefit exchange have encountered difficulty in ensuring that the exchange will not have punishing side effects on low- and moderate-income residents. They have learned that a segment of the population using the present state programs — Catamount Health and the Vermont Health Access Program — is likely to face significantly higher costs out of pocket when they are shifted to the new exchange.
The exchange is a marketplace for health coverage that is supposed to offer residents clear, comprehensive, affordable coverage choices. Members of the Legislature have promised to look at the high out-of-pocket costs and the inadvertent punishment of low-income Vermonters. Shumlin has not expressed an abundance of concern about the new cost burdens, but it is likely his health planners are working to negate the pain of the transition. They had better be.
Supporters of a new tax on sugared beverages say it could be a ready source of significant revenue to patch the leaky places in the new health care system. It’s a good idea, and legislators ought to give it a look.
The financing of the single-payer system has been a major question mark since Shumlin launched his reform effort. He drew criticism from Republicans for pushing back the release of a financing plan until after the election. This month time for that information has arrived, and Shumlin’s budget address, where he will spell out his plans, will be much anticipated.
The state has had to incur major costs because of the rebuilding of its mental health system following the devastation of Tropical Storm Irene. That is money well spent, much of it coming from the Federal Emergency Management Agency and from insurance on the ruined state hospital. The state should not stint on its mental health program, which was long overdue for improvements.
The new Legislature will have many competing interests to balance, such as the increased interest in pre-K programs around the state and upward pressure on property taxes due to rising education costs. Emotional debates on hot-button issues such as death with dignity legislation and decriminalization of marijuana can be expected to absorb great quantities of oxygen in the Statehouse, not to mention surprise controversies that inevitably pop up.
But health care, as part of the larger budget picture, will be a central concern of the session. There is no avoiding it. It is the elephant in the room, and it requires attentive and careful treatment.MORE IN Commentary
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