Report finds single payer costs may be higher than thought

####_loc_WebHealthMONTPELIER — An independent report delivered to lawmakers Thursday found that the savings estimated by the Shumlin administration in a proposed single payer health care plan may not be as high as projected.

Avalere Health LLC, commissioned by Vermont Partners for Health Care Reform, studied a previous report prepared for Gov. Peter Shumlin’s proposed universal health care system that he hopes will be implemented in 2017. The analysis presented by Avalere Thursday found three main areas of concern.

The Shumlin administration, based on its own study conducted by the University of Massachusetts, found that it would cost about $1.6 billion to finance Shumlin’s plan. The Avalere report believes that cost could be as high as $2.2 billion.

Administration officials countered Thursday by arguing that it still provides significant savings from the more than $3 billion spent annually on health care now outside of federal programs.

The report also noted that payments to providers are likely to drop, creating a disincentive for doctors to practice in Vermont.

Additionally, the administration may be projecting too rosy a scenario in terms of administrative cost saves, according the the Avalere report. The administration is projecting a savings based on a projected 12 percent administrative cost. The report states that the state’s largest insurance carrier, Blue Cross Blue Shield of Vermont, is already delivering insurance below the administration’s projected 7 percent under the proposed health care plan.

Vermont Partners for Health Care Reform includes Fletcher Allen Health Care, the Vermont Association of Hospitals and Health Systems, the Vermont Medical Society, the Vermont Business Roundtable, the Vermont Chamber of Commerce, the Vermont Assembly of Home Health and Hospice Agencies and Blue Cross.

A full story will appear in Friday’s Herald and Times Argus.