(Host) Governor Jim Douglas and Democratic leaders at the Statehouse were unable to reach an agreement on Tuesday over the financing of a health care reform plan. Douglas warned the Democrats that he would veto their current plan of using a payroll tax – a situation the governor says will lead to gridlock instead of progress.
VPR’s Bob Kinzel reports:
(Kinzel) It was a day where the participants in this debate held press conferences, reacted to the statements made in those conferences and then reacted to the reactions. But when all was said and done, the two sides seemed no closer to a compromise agreement than they were when the day started.
At the center of the debate is the Democrats’ belief that companies that don’t offer health insurance to their employees have an obligation to contribute to the state’s health care system. The Democrats want to impose a three percent payroll tax on these companies to pay for a package of primary and preventive care benefits for uninsured Vermonters. The workers would also pay the tax.
The governor says the tax will cripple economic development in Vermont. Instead he wants to impose a three percent tax on all health care premiums. The Democrats argue this approach penalizes the companies that do provide health care to their employees.
Douglas says he won’t compromise on the payroll tax:
(Douglas) “As the session lingers on into June it’s time to level with the people of Vermont about this health care proposal. It’s not comprehensive. It’s not responsible. It’s not sustainable. It’s short sighted and it would undermine the economic progress that we’ve made over the last couple of years.”
(Kinzel) If the Democrats insist on sending him a bill with a payroll tax, Douglas says the result will be gridlock.
The Democrats say they’re willing to look at a different tax source but the tax must be collected only from companies that don’t offer insurance.
Senate president Peter Welch:
(Welch) “We’ve got to get real here if people are going to have health care people have got to pay for health care. We cannot sustain the cost shift. It’s failed. Those days are over. We’ve got to pay for what it is we want. And that implies all individuals. And it applies to a fair financing system where we’re all in it with benefits, but we’re all in it with the obligation to pay for them.”
(Kinzel) House and Senate leaders are close to an agreement on an alternative payroll type tax that would be imposed on companies that don’t offer health insurance. The governor says he doesn’t like this plan either – a situation that could set up a showdown between the Legislature and the governor later this week.
For Vermont Public Radio, I’m Bob Kinzel in Montpelier.