Wasserman: Executive order pitfalls
Under the governor's order, older Vermonters and those who use tobacco products will pay more for health insurance. These changes are contrary to
Yet, the governor recently vetoed legislation that would have fast-tracked implementation of a tool (reference-based pricing) to address
The order mandates higher cost "age-based" commercial insurance premiums. However, this mandate will not apply to older Vermonters, most of whom are covered by Medicare, our publicly financed national health insurance program for those age 65 and older.
What are the thresholds for these new "age-based" premiums: ages 40-49, 50-59, and 60-64? Will these higher-cost plans cause Vermonters to leave the state?
With regard to tobacco use, the majority of Vermonters who smoke cigarettes have a high school education or less, and live in lower-income households. Do we want them to pay more for health insurance when they can't afford current coverage?
The governor's order will likely result in increased costs for young Vermonters, the very group whose health insurance premiums he hopes to lower.
How will the state implement its tobacco use policy? Will there be a different rate for people who occasionally use tobacco versus pack-a-day smokers? Will the policy distinguish between smoking, vaping, and nicotine pouches? And how will the state and insurers determine whether those who deny tobacco use, actually refrain from it? Administrative costs could grow along with the loss of privacy. Do we want to give insurance companies even more access into our personal lives?
Comprehensive health coverage is a societal necessity because all of us are at risk of an accident or an illness.
The purpose of insurance is to distribute financial burdens across a large group of people, ensuring no one person is devastated by high costs. Pooling as many people as possible into one large group (aka "spreading the risk") lowers insurance costs for everyone.
Will this unraveling of community rating usher in untoward practices where employers screen out age 40+ applicants and those who use tobacco? Will the governor employ higher rates for age and tobacco use with state employees, leading to greater costs for both employees and the state who pays their premiums? Will this order undermine the state's health insurance marketplace, turning it into an unaffordable high-risk pool due to the departure of healthy people? Will insurance companies promote seemingly attractive low-cost policies that provide insufficient coverage paired with crushing deductibles?
Simply stated, age-based and tobacco-based insurance policies are discriminatory and inequitable. They are also divisive and adversarial, pitting one group against another.
Vermonters tend to be fair-minded and emboldened with a strong sense of social justice.


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