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State of Vermont Health Care Financing Plan Beginning Calendar Year 2017 Analysis

By: University of Massachusetts Medical School, Center for Health Law and Economics, and Wakely Consulting Group, Inc
Authors: Katharine London and Julie Peper et al.
Published: January 24, 2013
Financed by: Vermont Agency of Administration
Legislation analyzed: Act 48


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Summary

Vermonters could get more value at a lower cost by implementing GMC. We estimate that total statewide health care costs will be $35 million lower in the first year of a unified, single payer system than the amount that would be spent without the GMC reform. A $122 million reduction in administrative costs statewide helps to pay for that additional coverage. This calculation of administrative savings includes only the reduction in costs that are currently incurred by the many different payers that currently operate in Vermont to the average cost level incurred by an efficient provider of administrative claims services. A single payer system will support state efforts to gain additional savings, for example through providing clinical services more efficiently and through reducing fraud and abuse; we did not include potential savings from these efforts in our administrative savings estimate.


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