On December 17, 2014, Vermont Governor Peter Shumlin publicly ended his administration’s 4-year initiative to develop, enact, and implement a single-payer health care system in his state. The effort would have established a government-financed system, called Green Mountain Care, to provide universal coverage, replacing most private health insurance in Vermont. For Americans who prefer more ambitious health care reform than that offered by the Affordable Care Act (ACA), Shumlin’s announcement was a major disappointment. Was his decision based on economic or political considerations? Will it damage the viability of a single-payer approach in other states or at the federal level?
Shumlin’s exploration of a single-payer health care system, which included three assessments by different expert groups, was among the most exhaustive ever conducted in the United States. A 2011 study led by Harvard health economist William Hsiao provided optimistic projections: immediate systemwide savings of 8 to 12% and an additional 12 to 14% over time, or more than $2 billion over 10 years, and requirements for new payroll taxes of 9.4% for employers and new income taxes of 3.1% for individuals to replace health insurance premiums (see table
Financial Estimates from Three Projections for a Vermont Single-Payer Health Plan.
).1 Two years later, a study by the University of Massachusetts Medical School and Wakely Consulting projected savings of just 1.5% over 3 years.2 Finally, a 2014 study by Shumlin’s staff and consultants predicted 1.6% savings over 5 years and foresaw required new taxes of 11.5% for employers and up to 9.5% for individuals. The governor cited these last projections in withdrawing his plan: “I have learned that the limitations of state-based financing, the limitations of federal law, the limitations of our tax capacity, and the sensitivity of our economy make that unwise and untenable at this time . . . . The risk of economic shock is too high,” Shumlin concluded.
