Taxes, Technology, and Timing: Lessons on Single-Payer Health Care from Governor Peter Shumlin
By Justin Kaplan
As the ideological battle for healthcare reform in the US wages on, support for a single-payer approach to health continues to grow, with many prominent Democrats embracing the platform of Bernie Sander’s “Medicare-for-all” bill. Amidst this pivotal shift in political thought, the Voices in Leadership series welcomed Peter Shumlin, former Governor of Vermont, single-payer healthcare champion and leader in progressive politics, on September 19, 2017. Shumlin, who served as the 81st governor of the Green Mountain State from 2011–2017, is internationally recognized for his bold policies on topics ranging from universal pre-K education to renewable energy production. In 2015, Governor Shumlin was chosen by President Obama to speak at the Paris Climate Summit, where he detailed his state’s enterprising approaches to combating climate change. Yet, he is perhaps equally known for a single campaign promise he left undelivered: implementing a state-run single-payer healthcare system in Vermont. A plan developed by Harvard professor Dr. William Hsiao, Vermont’s single-payer system sought to control health care costs by fundamentally changing the state’s healthcare system.
In 2014, Shumlin announced the termination of his single-payer pursuits, admitting that it was “not the right time” for the system in his small state. Speaking candidly with Dr. John E. McDonough, Professor of Public Health Practice in the Department of Health Policy & Management at the Harvard T.H. Chan School of Public Health, Governor Shumlin opened up about the greatest challenges his team faced while attempting to achieve state-level single-payer health care, sharing pragmatic advice for current politicians and future leaders hoping to challenge the status quo of U.S. healthcare.
Focusing on Finances
Governor Shumlin did not shy away from discussing the monetary roadblocks that impeded Vermont’s shift from a premium-driven health care system to a tax-based single-payer plan. Inadequate state reserves, significant income and payroll tax hikes, and the necessary reliance on federal partnership with an uncooperative Republican Congress topped the former governor’s list of financial barriers to success. As he noted, the difficulty in making systematic health care changes without “reserves like an insurance company” was further complicated by the additional undertaking of changing public perceptions surrounding healthcare financing:
“It’s very tough to make the sale to legislators and to constituents, hey, this is a great thing. You’re finally going to have health care as a right, not a privilege. But you’re going to have tax rates that are quite high replacing premium.”
Governor Shumlin also added tangible suggestions for policymakers in states considering single-payer financing who are concerned with cost containment, based on the implementation in Vermont:
“[W]e got the first waiver to take Medicaid, Medicare, and private pay and put it all in one system where we pay providers based on outcomes instead of fee for service. If you could […] make that work along with being able to negotiate drug price, you could actually get a much more predictable, stable cost projection that would allow politicians to have the courage to move to a public finance system.”
The Fault in our Exchanges
Although the herculean task of financing Green Mountain Care for a timely single-payer rollout was a widely anticipated issue, few expected that shortcomings in Vermont’s state-run online insurance exchange would play such a significant role in the plan’s downfall. Governor Shumlin succinctly summarized the woeful effects that an unreliable online marketplace had on accomplishing his goals, explaining:
“The technology simply couldn’t deliver on the promise in the time frame that had been laid out. […] And as you can imagine, I lost tremendous credibility as a leader on health care, when I couldn’t deliver something as simple, theoretically, as expanding uninsured on Medicare and Medicaid.”
Addressing the issue with frankness and humility, the former governor demonstrated that leadership often requires taking sole responsibility when hurdles arise — even when the circumstances are largely beyond your control.
In Politics, Timing is Everything
As Governor Shumlin frequently emphasized, dependable federal partnerships are vital for a small state adopting single-payer healthcare. Unfortunately for Green Mountain Care, dependability was not the case in 2014 — with the Republican-majority Senate and House keen on repealing the Affordable Care Act, the Obama administration “[didn’t] have the capacity to cut out special deals for Vermont, while […] up there on the Hill trying to defend Obamacare.” Governor Shumlin recalled the tumultuous political climate of the time:
“Obamacare became a political football. Healthcare reform became a political football. The timing couldn’t have been worse.”
Without the fiscal backing necessary to responsibly establish single-payer in Vermont, Governor Shumlin made the difficult decision to halt the plans he had fought years to realize. However, one would be remiss to classify his endeavor as a failure. In the field of public health, we are often placed in situations where we must choose between what is ethically ideal and what is economically practical. It takes a true leader like Governor Peter Shumlin to navigate these muddy waters without losing sight of the bigger picture:
“I’m such a believer that this is the right thing to do — that Americans shouldn’t be choosing between adequate health care […] and paying their mortgage, getting sneakers for the kids, putting food on the table — that I’m not going to take my experience and suggest that every other state would have the same experience as Vermont. I don’t want to jinx it…”
Story by Justin Kaplan, a first year student in the Master of Public Health program in Health and Social Behavior at the Harvard T.H. Chan School of Public Health, interested in behavioral economics, LGBTQ health, and health policy.
Story edited by Sohini Mukherjee, a second year student in the Master of Science program in Global Health and Population at the Harvard T.H. Chan School of Public Health, interested in gender equity, maternal health, and health policy and governance.