Blue Cross Blue Shield Vermont
LEGISLATIVE REPORT

For the Week Ending June 5, 2005

The 2005 session of the Vermont General Assembly formally adjourned for the year Saturday evening, but lawmakers may be back soon if Governor James Douglas follows through with veto promises on the FY’06 budget bill (H.516). A veto of the spending bill will require a special session to appropriate funds for the operation of state government after June 30th.

Douglas has also promised to veto the controversial health care reform bill (H.524) because House and Senate Democrats ignored his objections to a payroll tax to fund benefits for uninsured Vermonters.

House and Senate conferees agreed to modify a Senate payroll tax plan to make it simpler to administer and both chambers approved the conference report after any chance for a bipartisan agreement with the Governor broke down late last week in an unusually acrimonious public display at back-to-back news conferences.

At a noontime news conference, legislative Democrats put forth three funding options for the expansion of health benefits to the uninsured for the Governor to consider and gave him a deadline to respond. All three proposed options included a payroll tax, and one also included a premium tax favored by Douglas.

Douglas immediately rejected the legislative proposal because all of the options included a payroll tax. “What part of “no” don’t they understand,” Douglas asked at a packed news conference following the equally well-attended press conference where Democrats announced their offer.

The end-of-session fireworks over health care reform came as no surprise after months of legislative discussion of comprehensive reform amid continuous criticism from the governor. Douglas prefers a market-based expansion of coverage to the uninsured funded by a premium tax on health insurers, while majority Democrats in the legislature want a complete overhaul of the system with government control and public financing. Both sides agree on several cost containment strategies, including enhancements for information technology improvements, adequate funding for chronic care initiatives, and support for federally-qualified health care clinics (FQHCs). Those cost containment provisions were added to the budget bill, which also is now under veto threat because Douglas objects to an amendment that is intended to address a labor dispute over pension reductions for some faculty at Vermont State Colleges.

Legislators also included other provisions of H.524 in the budget bill, including a commission on health care reform to recommend changes in the health care system, economic, financing and administrative studies, and a public engagement process.

This is the last regular weekly report for the session. There soon will be a final report to wrap up all significant health care benefits actions taken this year. There will also be reports on any vetoes or special session activities if and when they occur.

For more information on legislative proposals, visit the Blue Cross and Blue Shield of Vermont website at www.bcbsvt.com or call Leigh Tofferi at (802) 223-6131 or Kathy Parry at (802) 371-3205. If you would prefer to receive these updates by FAX or e-mail, wish to discontinue receiving these updates or know of anyone else who would like to receive it, please call Kathy Parry at the above number or send an e-mail to parryk@bcbsvt.com
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