Analysis of the Costs and Impact of Universal Health Care Coverage Under a Single Payer Model for the State of Vermont
By: The Lewin Group, Inc.
Authors: John F. Sheils, Randall A. Haught
Published: August 28, 2001
Financed by: The Vermont HRSA State Planning Grant, Office of Vermont Health Access
Legislation analyzed: none, plan analyzed developed by the authors.
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Our analysis indicates that the single payer model would cover all Vermont residents, including the estimated 51,390 uninsured persons in the state, while actually reducing total health spending in Vermont by about $118.1 million in 2001 (i.e., five percent). These savings are attributed primarily to the lower cost of administering coverage through a single government program with uniform coverage and payment rules.
The single-payer program would greatly redistribute health care costs across families in various income groups by shifting from today’s premium based system to a tax based system where individual payments for health coverage increase in proportion to income. For example, families with incomes below $75,000 would on average find that their new tax payments under the program are more than offset by the elimination of premium payments and reductions in out-of-pocket spending under the plan. However, under the tax-based system, families with incomes of $75,000 or more will, on average, see a net increase in spending for health care.