Single-Payer Backers Say Plan Would Rein In Health Costs

April 02--BOSTON -- Nearly a decade after Massachusetts started requiring every citizen to carry health insurance, advocates say they're building support to again transform health care in the state.

Nearly 40 of 200 lawmakers -- including some in legislative leadership -- have signaled support for proposals to create a single-payer health care system.

"While we've done a good job at insuring folks, we've not done a good job at containing costs," said Sen. Barbara L'Italien, D-Andover, one of nine senators backing the idea. "We need to start the conversation on this."

L'Italien, a member of the Legislature's Joint Committee on Healthcare Financing, said switching to some form of a single-payer system will curb the state's skyrocketing health care spending and free up money for other areas of the state budget.

"We have the highest premiums in the country, health care costs are approaching half of our state budget outlay, and that's crowding out funding that could be going toward education, local aid and other areas," said L'Italien, who as a House lawmaker helped pass the state's landmark health care law in 2006.

Under a single-payer system, employers and employees would pay the state government through payroll taxes, instead of paying premiums to private insurers such as Blue Cross/Blue Shield or Tufts Health Plan.

Similar to MassHealth -- the state's Medicaid program -- employees would get a health care card that could be used at hospitals and clinics throughout the state.

Single-payer proposals call for new payroll taxes -- ranging from 2.5 to 7.5 percent, with exemptions for an employee's first $30,000 in earnings. Proceeds would be deposited into a state-managed fund to pay for the program.

Insurers opposed

The idea has plenty of opposition, notably from the insurance industry, which stands to lose billions of dollars if the current health care system is upended by a single-payer model.

Eric Linzer, a spokesman for the Massachusetts Association of Health Plans, which represents most of the large insurers in the state, said overhauling the system is not the best way to contain costs.

"The studies have repeatedly shown that government-run health care systems typically result in longer wait times and undermine quality of care," he said. "And it really wouldn't do anything to lower the cost of health care."

Linzer said the state should focus on meeting the goals of a 2012 cost containment law.

Single-payer advocates say tax increases needed to make the plan work -- estimated at more than $30 million -- wouldn't cost employers much more.

Even so, the state's business community is aligned against the plan.

"Employers across the state are already wrestling with the cost of health care," said Chris Geehern, a spokesman for Associated Industries of Massachusetts. "A tax increase of that magnitude would be even more onerous."

Despite the challenges of the state's existing health care law, Geehern said most employers feel that it is working.

Savings touted

MassCare, a group advocating for a single-payer system, says hundreds of thousands of Massachusetts residents still have no health insurance, despite the 2006 law requiring universal health care.

Savings on administrative costs under a single-payer system, the group argues, would be large enough to cover all the uninsured, eliminate co-pays and deductibles, and upgrade coverage for Medicare enrollees, without increasing health care spending.

Gov. Charlie Baker, a former health care executive, hasn't said if he supports any of the single-payer proposals. But he has been critical of government-run health care in the past.

But the idea has the backing of key legislative leaders, including Rep. Ellen Story, D-Amherst, and Sen. Jason Lewis, D-Winchester, who chairs the Legislature's Committee on Public Health.

Nationally, the issue has become fodder in the presidential election, with Democratic contender Vermont Sen. Bernie Sanders pledging to establish a federally administered single-payer health care program.

"Other industrialized nations are making the principled and financially responsible decision to provide universal health care to all of their people, and they do so while saving money by keeping people healthier," he said in recent campaign speech. "Those who say this goal is unachievable are selling the American people short."

Vermont backs away

But even Vermont, which became the first state to approve a single-payer system in 2011, has backed away from the program after learning that it would nearly double the size of the state's budget and require huge tax hikes.

Gov. Peter Shumlin, a Democrat and longtime single-payer advocate, ultimately decided not to seeking funding from the Legislature to implement the new law, known as Green Mountain Care, effectively axing it.

A report commissioned by Shumlin's office found that the plan would cost $4.3 billion in the first year, with taxpayers picking up $2.6 billion and the federal government covering the rest.

The report estimated his state would need to approve new personal income taxes up to 9.5 percent, in addition to existing rates ranging from 3.5 to 8.9 percent. Businesses would have to pay a 11.5 percent payroll tax -- on top of 7.65 percent payroll taxes employers pay for Social Security and Medicare, the report found.

In Massachusetts and elsewhere, switching to a single-payer system modeled on health care in Canada and Europe has been a dream deferred for progressives within the Democratic Party.

In the 1970s, Sen. Ted Kennedy fought unsuccessfully to pass legislation in Congress to create a government-run insurance plan.

President Bill Clinton tried to push through a plan in the late 1990s that would have required private employers to provide insurance coverage for their workers. His proposal, too, fizzled out.

In 2006, then-Gov. Mitt Romney signed a law making health insurance mandatory in Massachusetts and setting up an insurance exchange. The law became the template for the federal Affordable Care Act, known as Obamacare.

A recent study by the Blue Cross/Blue Shield of Massachusetts Foundation found 95.7 percent of working-age adults in the Bay State are insured.

But single-payer supporters say, even with near-universal coverage, many people are struggling to afford it.

"Health care insurance is unaffordable for most people and employers, and I think we need to take a serious look at this," L'Italien said. "We are the only major country in the world that isn't looking at doing this a better way."

Christian Wade covers the Massachusetts Statehouse for the North of Boston Media Group's newspapers and websites.

___

(c)2016 The Eagle-Tribune (North Andover, Mass.)

Visit The Eagle-Tribune (North Andover, Mass.) at www.eagletribune.com

Distributed by Tribune Content Agency, LLC.