Md. legislators hear single-payer health care proposals

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ANNAPOLIS — Single-payer health care could be a long-term solution to Maryland’s health insurance woes, sponsors of two single-payer bills told a Maryland legislative committee Monday.

While a lot of criticism of single-payer health plans focuses on their cost, sponsors of the Maryland plans believe they have found solutions that could get all residents covered without significantly increasing state expenditures.

“Single-payer health care is not that scary,” said Del. Kirill Reznik, D-Montgomery, and the sponsor of one of the single-payer plans. “The vast majority of our state’s residents get their health care from the government already. We’re not that far. We’re really not.”

Between Medicaid, Medicare, TRICARE, federal employees, (Veterans Affairs), more than 3 million Marylanders get health care from the federal government, he said. Additional state and local government employees have their insurance paid for by the state.

Reznik’s plan would set aside people who receive their insurance from the federal government and focus on covering everyone else in the state. Maryland residents are projected to spend about $59.3 billion on health care this year.

Most of the funding for Reznik’s plan would come from a 10 percent payroll tax on businesses employing Maryland residents. That money would go to a health coverage fund, which would be billed for health care expenses.

Despite the new tax, business should save money by not paying for health insurance, Reznik said.

“With a 10 percent payroll tax, almost every single employer in this state will save money,” he said.

The plan would find money by realizing efficiencies in the health insurance market, including the state becoming a significant drug purchaser. It would also focus on improving access to primary care physicians and preventive care.

Under Reznik’s plan, health insurance companies operating within the state would continue to operate as managed care organizations. Maryland residents would have their health care costs billed to the state.

Insurers would make less profit in the state, but their operations would come with almost no risk to them, Reznik said.

“The insurance companies don’t have to go out of business,” he said. “They will also make a lot less profit.”

Del. Erek L. Barron, D-Prince George’s, also presented a plan that would take advantage of efficiencies gained by making Maryland a single-payer state.

His bill would gain control of all of the money that Maryland already spends on health care and pool it under one fund. Gov. Larry Hogan’s 2019 budget includes $13.2 billion of health care spending.

The fund could also grow as the legislation would authorize a payroll tax and waivers to attract more federal funding. All of that would be considered by a board created by the legislation to set up the single-payer system.

Reznik and Barron see their plans as long-term solutions to push while the state tries to stabilize its individual market with short-term solutions. That market saw significant premium increases this year, and the state is considering reinsurance and an individual mandate to keep premiums from increasing again next year.

“Most of the conversation has been around Band-Aid patchwork fixes,” Barron said. “These aren’t long-term solutions like this bill is.”

Former Maryland U.S. Rep. Donna Edwards, D-Prince George’s, said her health care costs have continued to grow since she left the federal government. Under a COBRA plan, she has paid $800 a month to continue with the federal government’s plan.

This summer she will completely leave that plan and expects to pay $1,600 a month with a $6,500 deductible. She was diagnosed with multiple sclerosis two years ago and expects her out-of-pocket costs to reach $30,000.

“This is the nature of an insurance-provided system,” she said. “I think the system that we have now is unsustainable in the current marketplace.”

While single-payer health care has drawn support and curiosity from progressive groups, some legislators expressed skepticism about how the program could work in Maryland.

They drew comparisons to stories of long waits for treatment in Canada and Vermont’s failed attempt to set up a single-payer system earlier this decade.

But single-payer supporters said Vermont lacked the political will to see the system through and Canada’s wait times can be an over-publicized outlier.