Public Policy Detail
Vermont Business for Social Responsibility
Testimony at Health Care Reform Public Hearing April 24, 2007
Summary: The benefits to Vermont of implementing a comprehensive system of universal health care are significant. They include a more stable and productive workforce; improved efficiency and reduced costs throughout the public and private sectors, and a healthier population of Vermonters. The time has come to gather the strengths of our citizens, the dedication of the business community, and the political will of our elected leaders to move universal health care forward.
Testimony: VBSR is a non-profit statewide business association with approximately 650 members. These members employ approximately 10-12% of the state’s workforce and contribute approximately 4 billion dollars annually to the state’s economy.
Since 1992 VBSR has issued policy positions arguing that health care and health insurance are economic development issues and that the health care insurance system needs reform so that our employees---our families and neighbors--- can have universal access to quality health care. We strongly believe that the policy focus needs to be on separating health insurance from employment- or for that matter from marital status, economic status, veteran status, etc.
Our members have been forced to cope with increasing insurance premium increases the past few years. Policy survey in Jan. 2007 with130 respondents. 37% of the respondents (95) for this question responded that insurance premiums have gone up at least 20% or more in the past few years. 75% of the respondents have had premiums go up at least 11%.
The rising cost of health insurance premiums is one of the most uncontrollable elements of business overhead and is forcing Vermont companies to make difficult choices like dropping or reducing coverage. When this happens, the costs of health care is either absorbed by the business, or shifted to families, state programs, or back onto those who are insured and those employers who continue to provide insurance. In our survey (105 answers), 67% of the businesses said they are absorbing some or all of the rising costs, 41% said they chose a plan with a higher deductible, and 22% were forced to increase the employee’s contribution to the plan. (Note: respondents could check more than one).
Increased health insurance premiums means businesses are reduced in their ability to invest money back into their business, raise employee salaries, increase other benefits like retirement plan savings, etc. Economic development in our state is very closely tied to the solution of this worsening problem.
VBSR believes that a health care plan for Vermont should include these elements:
- Universal coverage and access
- Cost management to provide accountability and sustainability
- An integrated system of care (wellness, preventive, medical, surgical, emergency, rehabilitative, and behavioral health care must be included).
- Promotion of healthy behaviors and prevention
- An equitable funding mechanism that takes into account the contributions already made by business
Financing Vermont's universal health care system is perhaps the most challenging aspect to implementing the plan. We appreciate steps that have been taken to date to reduce the cost shift to date but more needs to be done. VBSR believes that a progressive financing mechanism is essential, using public financing if necessary. There should be no financial barriers for patients to obtain care.
Ideally, decisions about coverage and affordability of basic insurance should not be based on employment or income status. As long as we have an employer-based system, this goal is difficult to attain. If, however, the health care system were independent of employment status, it would provide a number of significant advantages including the freedom of employees to change employment without concerns over losing health coverage, and eliminating health coverage as a labor-management contract dispute item.
Conclusion
The benefits to Vermont of implementing a comprehensive system of universal health care are significant. They include a more stable and productive workforce; improved efficiency and reduced costs throughout the public and private sectors, and a healthier population of Vermonters. The time has come to gather the strengths of our citizens, the dedication of the business community, and the political will of our elected leaders to move universal health care forward.
