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Parnell should study Vermont's single payer plan

Posted: July 18, 2012 - 11:03pm

Like all loyal Republicans, Gov. Sean Parnell never liked big government’s Affordable Health Care for America Act. Now that’s it’s been declared constitutional by the U.S. Supreme Court, he’s set his sights on Medicaid expansion as the one provision he can resist implementing. The rest of his opposition has been reduced to political sound bites. But if he was really interested in helping Alaskans control the cost of health care, he’d be directing his Health and Social Services Commissioner to examine Vermont’s single payer plan that was signed into law two months ago.

On the tax front, the Affordable Care Act isn’t the “single largest tax increase in American history” as Parnell suggested. It barely ranks among the top 10 increases ever enacted. And most of the new taxes won’t affect the “working poor and middle class Americans” as our governor claims. More than 40 percent of the estimated tax increase will fall on individuals earning more than $200,000 per year ($250,000 for couples). They’ll be paying an additional 0.9 percent on the hospital insurance portion of the FICA payroll tax.

The 15 categories of new or increased taxes were all part of the act before the Supreme Court ruling. However, there’s a reason why Republicans didn’t rally around them two years ago. Most of them, like the hospital tax increase and the new annual fee on health insurance providers, won’t make points with the average voter.

The bull’s eye of the act has been the “individual mandate” that requires all Americans to have “minimum essential” health insurance coverage. And employers with more than 50 people on the payroll will be required to offer to them a plan that meets that minimum coverage. Otherwise, individuals and businesses will be subject to a tax, not a penalty, as it’s now defined by the Supreme Court.

What does this mean for Alaskans? Currently about 18 percent of the state’s population is uninsured. About a quarter of them have been living above the federal poverty threshold but will gain Medicaid coverage as long as Parnell doesn’t reject the provision which expands eligibility for the program to 133 percent of that threshold. His gripe is that it will cost the state $30 million a year. Even if his figures are accurate it’s a weak argument because that’s pennies relative to the state’s $12 billion operating budget.

The rest of the state’s uninsured will have to decide whether they want to pay an additional tax or purchase an insurance plan from an out-of-state health care provider. And here’s where Vermont’s single payer plan differs -- their residents won’t be forced to enrich the CEOs and shareholders of any big corporation.

The Vermont plan isn’t socialized health care. People can still to go to the private sector doctor or hospital of their choice. Its main objective is to eliminate the private insurers who only serve as a profit-making money exchange between doctor and patient. Just because those companies compete on the free market doesn’t mean they’re in the best position to contain the skyrocketing cost of health care. Indeed, they’ve failed to do just that over the past 60 years. Besides, the vast majority of us couldn’t tell which company offers the best policies because we haven’t got the expertise to decipher their pages of complex rules and fine print of exemptions and exclusions.

There’s a partial variant of single payer health insurance already at work in Alaska. It’s for employees and retirees of the state itself. Private companies may process the claims, but the funds to pay them come from the state treasury. Interestingly, when the Parnell administration announced last week that it was looking for ways to bring down the $600 million the state spends on health care, no one said they’d be turning to the private sector for help.

I’m not saying a single payer plan for Alaska is the solution. But only that the governor be openminded enough explore it without a prejudicial fear of socialism. Vermonters are moving in the direction of getting both the federal government and the large out-of-state insurance companies out of their lives. And that’s a goal all Alaskans should agree on.

• Moniak is a resident of Juneau.

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