Saturday, May 14, 2011

Vermont Single Payer

That Vermont is on the cusp of adopting a Single Payer health care system is getting notice across the nation. What gets less notice is the structure of that particular arrangement.

At heart, what has been agreed to is a grand bargain between people and providers. Providers will provide necessary care and people will pay for it, under a mutually agreed rate structure and limitations. That is the key hurdle single payer plans must climb, getting providers to accept pricing regulation. Other aspects of single payer have been done before, taxes and government health care are not new but the provider pricing regulation is unprecedented.

In Oregon proponents of Single Payer generally brush aside cost control with hand-waiving about “negotiating”. They ignore the reality that providers have choices, either to not participate and effectively create a second, smaller and much more expensive private market or to even move out of state. Buy-in from providers is critical, as it is from people with respect to limits (i.e. no “death panel” drama). Without the cost control mechanism single payer is nothing but a new tax plan.

I expect Oregon will learn a lot from Vermont, I hope we learn the right lessons.

Correction: Provider pricing regulation isn't totally unprecedented, but Vermont's plan is significantly tougher and broader.

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