GUILFORD — Vermont likes to think of itself as a leader in health care, but Peter Sterling will quickly tell you that doesn't necessarily mean that everything is fine.
There are 44,000 uninsured Vermonters, he says, and 70 percent cite cost as the reason why.
If you are enrolled in Vermont Health Connect, Sterling says people have to pay up to 30 percent of their gross income for health care should an individual or family reach their out-of-pocket limit.
This means an individual with a gross income of $47,000 enrolled in a “silver level” health insurance plan will pay $5,124 per year in health care premiums for a policy with $5,100 annual out-of-pocket limit, plus a $1,250 prescription out-of-pocket limit. That amounts to $11,174 per year, or 24 percent of gross income.
“People may be able to get health insurance (under the Affordable Care Act), but they may not be able to get health care,” Sterling said. “Asking people to pay $11,000 a year for health insurance is not acceptable.”
Sterling is the executive director of Vermont Leads: Single Payer Now, a nonprofit organization working to help create in Vermont the nation's first universal publicly funded health care system.
On April 7, Sterling presented at the Guilford Community Church on the benefits of moving to a single-payer system, the timeline for its creation, and the barriers that might derail the plan.
Green Mountain Care, the state's single-payer plan, is set to take effect on Jan. 1, 2017. “On that day, everyone in Vermont will have health insurance,” Sterling said.
That insurance would be publicly financed, something that Sterling said that 49 percent of Vermonters are familiar with. That is the combined number of people who have either Medicare or Medicaid, are public employees, or are retired from the military.
The benefit package is still being formulated, Sterling said, but the goal is to not stick Vermonters with big deductibles and out-of-pocket costs.
And, he said, Green Mountain Care would save Vermonters money.
If nothing is done, the estimated total health care system cost in 2017 would be $5.9 billion. Under Green Mountain Care, however, the cost would be $3.7 billion.
The estimated statewide administrative costs in 2017, if nothing is done, would be $523 million. Under Green Mountain Care, it would be $401 million, or a $122 million savings.
And health care providers would receive payments set at 105 percent of the Medicare reimbursement rate, currently 82 percent.
But the big question remains: how will this be paid for?
Sterling said that when federal reimbursements are taken into account, the actual amount of money needed drops to $1.7 million from $2.1 million. Considering Vermonters already spend $2.6 billion on health insurance premiums and out-of-pocket costs, even at the high end of the estimated cost, Sterling said that Green Mountain Care would save at least $500 million
Business owners would likely pay a 10 percent payroll tax, combined with other taxes such as personal income, sugar-sweetened beverages, a higher rooms and meals tax, and higher taxes on corporate income and unearned income.
He said he believes Vermonters understand that they will have to pay higher taxes to fund universal health care. “We're already paying for health care. Now it's nut-cracking time.”
The polling, he said, bears him out. A January poll of Vermont voters found that, without any explanation, 24 percent of Vermonters said they support single payer, 25 percent oppose it, and 49 percent said they didn't know.
With an explanation that single-payer means universal coverage, no more insurance companies and the state pays the bills with taxes, the numbers changed to 55 percent for and 42 percent against.
“People get that single-payer doesn't mean changing doctors, hospitals, or procedures,” Sterling said. “It just means one entity collecting the money and paying the bills.“
He said it will still take a major leap of faith by Vermont's lawmakers.
“A year from now, the Legislature will be voting on the largest tax increase in Vermont history,” Sterling said. “And Gov. Shumlin thinks people still support a single-payer plan, but are scared about how it will be funded.”
But the reality, he said, is that most people don't think about health care costs until they get sick. “Medical costs are still the No. 1 cause of bankruptcy, and most of those people have health insurance.”
Sterling said people need to start paying attention, because escalating health care costs will swallow up everything.
“If people aren't interested in health care reform because they believe there are other issues that are more pressing, I would say that they will have a hard time funding other programs until something is done about health care,” he said.