Douglas offers health care compromise

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(Host) Governor Jim Douglas has offered a compromise plan on health care reform that he says will expand coverage to those without insurance. The governor wants to expand and raise a tax on health insurance premiums to pay for the plan.

Democratic leaders say the proposal is a good start, but that it puts additional burdens on companies and individuals who already have coverage.

VPR’s John Dillon reports:

(Dillon) Douglas says his plan takes the best ideas of House and Senate proposals on health care reform. He would raise $235 million dollars over five years to guarantee universal access to health care.

(Douglas) “What I’ve proposed specifically is that we expand the revenue base beyond where I proposed originally – an extra percent on the insurance premium assessment to three percent. And also to move more quickly, in fact immediately, to universal access, to insure that all Vermonters who don’t have coverage have access to it right now.”

(Dillon) The governor’s plan includes a patchwork of new revenues, subsidies, and additional measures to control health care costs.

For-profit insurance companies pay a premium tax of two percent. Douglas wants to increase that tax to three percent. He also wants non-profit insurance companies, like Blue Cross to start paying the tax.

The administration says the extra twenty million dollars raised each year could draw down additional federal funds. And that money would be used to subsidize premiums for those without insurance.

Under Douglas’ plan, the administration would subsidize two kinds of coverage.

(Douglas) “What I’m proposing actually that there be a choice, that there be a primary and preventive care package similar to what the senators have recommended, but as an alternative a catastrophic policy. I think that some Vermonters, perhaps young relatively health ones, would find that for their personal and family needs, that’s a more urgent requirement.”

(Dillon) Douglas met with Senate leaders on Friday to brief them on his plan. Senate President Pro Tem Peter Welch says the administration now recognizes the urgent need to control health care costs. Welch is also pleased that the administration is now committed to universal coverage.

(Welch) “Where he’s different is that he’s not willing to say that all of us have to contribute to the cost of health care. And what he’s doing is really suggesting a premium tax on the employers who are paying, like, say like IBM, but not asking Wal-Mart to contribute its fair share. And that frankly doesn’t make a lot of sense from a fairness standpoint.”

(Dillon) The governor says he got out of his own political comfort zone by proposing higher taxes on insurance companies. Welch says the governor needs to compromise further.

(Welch) “And we need him. We’re going to need vigorous leader on the part of the governor if we’re going to get to where we want. But I think he’s going to have to show some more movement on how we fairly fund a health care system that all Vermonters have to pay for, and all Vermonters we hope benefit by.”

(Dillon) The Senate plan would raise the payroll tax on companies that don’t provide health insurance. But Douglas is opposed to the payroll tax idea.

For Vermont Public Radio, I’m John Dillon in Montpelier.

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