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Follow VPR's statehouse coverage, featuring Pete Hirschfeld and Bob Kinzel in our Statehouse Bureau in Montpelier.

Health Care Financing A 'Must-Pass' Bill Before Lawmakers Head Home

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AP/Toby Talbot
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High on the list of “must-pass” bills as the Legislature inched toward adjournment on Tuesday was a plan to finance Vermont’s new health care exchange beginning in January 2015. The estimated annual cost is $18 million.

When the exchange goes into place, it will be financed initially by a continuation of the current assessment on employers that don’t offer coverage to their employees. That assessment is roughly $400 a year for each employee.

Even though the Catamount Health program will be phased out at the end of year because its participants will be eligible for federal subsidies in the exchange, lawmakers have decided to continue with the employer assessment for the foreseeable future.

“I do think that the employer assessment is in place today in order to help people get access to health care,” said Rep. Michael Fisher, D-Lincoln, the chairman of the House Health Care Committee. “And I think that same purpose is in play after the Exchange starts so I don’t think it’s in any way inappropriate.”

The bill as passed by the Senate also included a 1 percent tax on all health care premiums. House Republican leader Don Turner objected to that provision because he said it raised more money than is needed to run the exchange.

“This $2 million surcharge is new,” he said. “We don’t necessarily need it because we still even in FY ‘16 have over $4.7 million more than we need. So they agreed to eliminate that.”

Another bill on the agenda in the final hours of the session was legislation that’s designed to slow down the growth rate of local school spending.

Currently if a town spends more than 25 percent above the statewide average, a sizeable penalty is imposed. One plan would lower this threshold to 21 percent over a period of years.

House Ways and Means chair Janet Ancel says she thinks this approach will be effective because many local school boards work hard to stay under the penalty threshold.