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GOING FORWARD



GOING FORWARD - Con Hogan (prepared for Coalition 21 in January 2007, published in March 2000

Vermont made a run at health care reform over the last two years and ended up passing the Catamount bill. Much energy and work is being applied to the two main aspects of the bill, namely enrolling people who cannot currently afford health care into a health care plan, and putting together the machinery to apply managed care techniques to about three quarters of the Vermont population diagnosed with a chronic disease. Given the above realities, the following is my projection as to what will happen on the health care front, at the state and federal level, as we go forward:

  • The cost of health care will continue increasing at rates of between 8 and 10 percent each year, in an environment where there is not a 'system' that can be reasonably shaped and controlled.
  • These ever-rising costs will have certain consequences.
  • At the continuing rate of increase, the overall cost of health care will double by 2012.
  • These rapidly rising costs, when combined with other severe economic pressures facing the middle class, will result in ever more people forgoing health care coverage because they simply will not be able to afford it.
  • The above dynamics will result in state government having to appropriate more and more to this cause, simply to stay even with the rising uninsured, at the expense of other pressing needs, such as property tax reform, transportation, and the other legitimate functions of government. The cost of health care simply overwhelms all other costs.
  • Primary care physicians, who are the backbone of health care, will be under increasing bureaucratic and financial pressure. When one looks at a combination of declining numbers of physicians entering primary care, combined with the rapidly aging primary care work force, it is not hard to predict a serious shortage of these key players in the relatively near future. This is important because an adequate supply of primary care physicians are inextricably linked to higher quality and lower relative cost.
  • In Vermont, the rising cost of Medicaid will be slightly checked by a variety of cost control techniques, but not enough to slow the overall engine of increasing health care costs.
  • The Medicaid Global Commitment will continue to be perceived as good policy, until the loss of traditional firewalls between long term care and other Medicaid expenditures results in a decline of resources for elder services, and a decline in the quality of those services.
  • At the national level, there will be significant progress in providing coverage for children, with the federal government playing a stronger fiscal role.
  • In the meantime, the current trend of the number of adults lacking coverage will continue to increase nationally, as well as in Vermont.
  • The Federal Government will also make progress in reducing the costs of pharmaceuticals through amendments to Medicare Part D, and other methods.
  • The impact that the cost of health care has on the burden of business and its ability to compete globally will become clearer and more worrisome.
  • Federally, the cost of Medicare will greatly increase, primarily as a result of the rapid aging of the general population. However, because of population demographic shifting, Medicare will become an untouchable social security-type "political third rail."
  • At both the state and federal levels, the overall proportion of health care paid for by government will continue to increase.
  • On the political front, Vermont administrations and legislatures will not want to deal with health care issues in any substantial manner, in that the prevailing political mood is to give Catamount a chance 28 to work, with a generally hands off cycle lasting another four to five years.
  • By 2012, health care costs will have doubled, with quality issues coming to the fore.
  • All this will set the stage for a "Medicare for All" political upheaval both at the state and federal levels, finally resulting in the creation of a health care system, primarily financed with broad based taxes, that has a chance of being shaped and controlled. This is a scenario that sees change as a response to major trends such as those outlined above. The problem is so large, complex, and intractable that common-sense planning, ordinary coalition building, and incremental steps forward in the political process have not worked and, in fact, cannot work. What will cause change is the accumulation of trends, such as outlined above, that will bring the health care system close to a fiscal and quality meltdown. Only then will there be enough political will for major change, driven by broad based demand from those outside the health care system.

    Con Hogan is a former Vermont Secretary of Human Services. He chaired a Commission on Health Care Reform in 2000, and recently co-authored the book "At the Crossroads: The Future of Health Care in Vermont."

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