(Continuing the policy of promoting diaries from officeholders and officeseekers, with some copy bumped below the fold – promoted by odum)

February 7, 2010

A year ago we had great hopes for serious healthcare reform on the national level.  However it’s becoming more and more clear, especially after the recent election in Massachusetts, that we cannot count on Washington to do the job we need to do ourselves here in Vermont – transform our healthcare system.

Let’s face it.  Healthcare costs are driving most of the financial problems in our state.

Bankruptcies?  Healthcare.  School budget increases?  Healthcare.  Teacher pension fund?  Healthcare.  Small business costs?  Healthcare.  Most of the state budget deficit?  Healthcare.

We can cut back on reimbursement to providers from state programs; we can slash low-income children off the rolls; we can lay off teachers; we can raise taxes; we can force everyone to have high deductibles.  All will be short-lived fixes unless we fundamentally change the system.

Over the last two decades, Vermont has tried a variety of small changes here and there to solve the looming healthcare crisis. It is now clear that they have failed, and in some cases have made things worse, as we have subsidized more people’s care without effectively addressing the core cost drivers.

The Vermont legislature is now facing a horrible decision: Will we stop serving our citizens or will we cause even more cost shifting for hospitals by cutting reimbursements below what it costs to do a procedure?

If we raise taxes today to cover the deficit caused by healthcare costs and do nothing to change our system, we will find ourselves in exactly the same situation next year.

Instead, we can do what large businesses do and self-insure Vermonters under one system to increase our buying power, reduce administrative costs, and guarantee that everyone pays and everyone is covered.  The fact is that some large companies employ and cover nearly as many people as we have living in Vermont.

When I was the head of AmeriCorps*VISTA, I self-insured all 6,000 people working for me, not because it was the right thing to do. . . but because it saved money. We then used those resources to achieve our core mission.

With one large pool, the state will then have the buying power to change the way we reimburse for medical care — rewarding doctors, hospitals, and citizens for prioritizing healthcare activities that lead to health outcomes, rather than paying per procedure. Hospitals like the Cleveland Clinic and the Mayo Clinic have demonstrated that better care can come at dramatically lower cost. We can bring these demonstration projects to scale.

When I was in the Senate, I proposed adopting an electronic healthcare record system similar to what VA hospitals have been using for years. We successfully created VITL organization, but unfortunately, four years later and despite financial support from Senator Leahy, the administration has not finished the job. This system would allow hospitals to share information with each other. This will allow us to measure the effectiveness of our healthcare providers, reduce medical errors, and help prevent expensive and unnecessary mistakes.

If mechanisms are not found to cut the ever-spiraling costs of medical procedures, prescriptions drugs, and hospital visits, our towns will continue to run deficits to devastating effect.  Vermonters will continue to go bankrupt.  Our business growth will be stifled, prolonging the recession.  Taxpayers will be saddled with huge tax increases. Our hospitals and doctors will be focused on uncertain revenues and paper work, not making people well. And our ailing friends, neighbors and relatives will continue to suffer because they cannot afford, nor will they seek out, even the most basic of healthcare.

Now is the time for Vermont to use its scale, sense of community and our in-state expertise to lead the nation in healthcare reform. As urgent as it is, such a change will not happen overnight. The legislature must take steps now, like initiating a statewide hospital budget, so we can start to achieve real cost-containment in the near future. Vermonters must let our elected officials know that change must start this year and demand real leadership on this issue for the future. We cannot wait any longer.