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VT: Maybe Universal Health Care

Vermont cut a deal today for a plan promising universal health coverage, although the deal still leaves a few potential details up in the air for the future.

The basic deal is this: a new "Catamount Health" plan should be offered by private insurers within two years, with the state subsidizing coverage for lower-income families. If the private insurers fail to voluntarily offer the specified plan within two years, state regulators would have the authority to mandate that they offer it.

Originally, state legislators had wanted to have the state directly offer the insurance to state residents, much like Medicare and Medicaid, but the Vermont's Governor, Jim Douglas, insisted on protecting insurance company profits at the expense of the public. Giving in to the veto threat, the legislature agreed to have the system administered by private insurance companies as the only way to get a deal:

Senate President Pro Tempore Peter Welch, D-Windsor, noted the governor and Legislature conceded on important issues. "Many of us here believe that a self-insured system would provide more benefits for less cost," Welch said. "But we were satisfied that in the end, when we looked and listened to our own consultants, the proposal we have will provide a real benefit to Vermonters who need it. That is the bottom line for all of us."

The bill also includes a provision that requires employers to provide insurance to their employees or pay a $365 fee per full-time employee to the state.

The promise of the bill is more affordable health care for all families. We'll have to see if the final details as implemented hold up, but this was the promise of the bill as detailed last week:

It is supported by sliding fee scale subsidies for families of four making less than $60,000 a year or individuals making less than $30,000 a year. With Catamount Health, an uninsured individual making $25,000 can buy health insurance for $125 a month. When combined with Vermont's Dr. Dynasaur program for children, a family of four making $50,000 a year will be able to get coverage for $290 a month. Even the uninsured who don't qualify for the sliding fee subsidy will be eligible for Catamount insurance at a rate that is 34 percent less than what they might currently pay for similar coverage in the private market.

Stronger employer responsibility and cutting out the insurance company role would have made the bill better and the deal still hinges on whether the private insurance companies step up to the plate to provide the insurance promises; if not, we're likely to see a round of negotiating over what exactly state regulators will require the insurance industry to do. But it looks more promising than the Massachusetts deal from last month.