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Same as it ever was

Vermont's two providers of health care through Vermont Health Connect filed their proposed rates for 2015 with the Green Mountain Care Board this week and guess what?

Rates are going up.

No surprise, really. Vermont's health care exchange has been a complete disaster since its rollout and much of the work that should have been handled by the state got dumped on the two insurers who are designated to insure the entire state.

That should really be no excuse for an almost double-digit increase from Blue Cross Blue Shield (9.8 percent) and a double-digit increase from MVP (15.4 percent). As for reasons for the steep increases, both carriers cited federally mandated changes as well as changes in state and federal health care reforms which include increased federal fees (included in the exchange pricing), reduced federal subsidies for Vermont's exchange and a small expansion of dental benefits for children.

Blue Cross is the state's largest insurer, covering more than 220,000 Vermonters but only 57,000 through the state's health care exchange.

Blue Cross reports that its internal increases amount to 3.3 percent and that the federal and state changes create the additional 6.5 percent increase. That state and federal changes would cause such steep increases to the insurers selling on the exchange is an unfortunate contradiction. Weren't government-run exchanges supposed to mitigate steep increases?

What is probably most unfortunate about this is that it affects Vermont's small businesses that are mandated into the exchange but still doesn't impact employers with more than 50 employees and certainly does not impact state employees or the state's teachers or other unionized employees.

No one but the small business owners who are trying to continue to provide health care for their employees and individuals who are purchasing directly from the exchange will feel this pain.

Can we expect that those individuals will receive a wage increase sufficient enough to allow them to pay 9.8 percent more for health care? Can we assume that employers can afford another 9.8 percent for their employees' health care without reducing other benefits or wages or cost of living increases?

Remember that only some 90,000 Vermonters are insured through the health care exchanges, tens of thousands of whom got shifted in from Medicaid, VHAP or Catamount. That leaves precious few souls to be paying these increases while the bulk of Vermont employees continue with their own private coverage.

The flaws in Vermont's health care exchange are legion, not the least of which is that so many, many thousands of people and employers who should have skin in the game simply don't and that puts the burden squarely on the wallets of too few.

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# RE: Same as it ever wasWalter Carpenter 2014-06-06 01:35
"Can we expect that those individuals will receive a wage increase sufficient enough to allow them to pay 9.8 percent more for health care?"

I agree wholeheartedly with this statement. This has been one of our nation's (and Vermont's) numerous problems with our way of health insurance all along, including Obamacare which is based largely on private insurance. Please remember, though, that these rates are proposed rate increases. They still have to go through the rate review process at the Green Mountain Care Board (GMCB). I would not be surprised if these requested increases were put forth knowing that they would not get them, but negotiating down to the rate increases they wanted in the first place.
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# Obamacare vs. Green Mountain Carechuck gregory 2014-06-08 10:29
1. There's a difference between the operation of the exchanges and the coverage of Obamacare: The former is mostly dependent on the programming algorithms that are supposed to ensure smooth processing of applications; the latter is designed to curtail only the worst abuses of the private health insurance system.

2. Because insurers are now required to accept clients with preexisting conditions, it is necessary for their profitability to increase prices. However, they highball their increases in the presumption that the state is going to negotiate them downward.

3. Good as it is, Obamacare was passed only because it guaranteed continued profits for insurance companies-- and $80 billion in profits over the next decade for the pharmas. Green Mountain care is going to take away the insurance companies' business, which means immediate cost reductions. This is where even the most pessimistic of the five studies done-- that of the Valere Group-- admits cost savings of half a billion over what Vermonters are now spending.

4. As I am fond of saying, when it comes to taxes, the state legislature is like a debutante who believes her boy friend is the only man in the world and that he will leave her if she does not whore for him. Because most costs will be paid by taxes, it is dependent on the Legislature to get over that mindset. Companies with their own health care plans should be taxed as well; it will encourage them to do better by their employees (you've seen SiCKO, I hope). The cost should not be borne simply by a payroll tax, but by both increased income tax and a tax on the (my estimate) $32 billion of privately held property that has hitherto been exempt from property taxes.

5. In per capita GDP (per CIA data), Vermont is wealthier than 21 of the 36 countries that have better health care and better health care outcomes than the US. There's no reason why the Legislature shouldn't shoot for an "all for one and one for all" approach in its better alternative to the ACA.
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