Vt. House Backs Individual Health Insurance Mandate

Tuesday, March 13, 2018

The effort to establish an individual health insurance mandate in Vermont took another step forward on Tuesday.

The House gave preliminary approval to H.696, which would require that all state residents buy health insurance as of Jan. 1, 2019.

The bill does not yet include a penalty for those who don’t buy insurance. Instead, a working group would study the issue and come up with recommendations later this year.

Implementation of a penalty “would require future action by the general assembly” in 2019, said Rep. Tim Briglin, D-Thetford and ranking member of the House Health Care Committee.

There is still a federal mandate for buying health insurance. But a tax overhaul approved by Congress last year eliminates the mandate’s penalty mechanism in 2019.

Some fear that will cause many to drop their insurance, which could lead to increased premiums for those who retain coverage.

As a result, some Vermont lawmakers have responded by pushing for the state to enact its own mandate.

Speaking on Tuesday on the House floor, Briglin said “insurance markets do not function like other markets.” There are two main dilemmas that complicate health insurance, he said.

One is a “free rider” issue, meaning that those who are not insured still receive medical treatment.

The other is the fact that, in the absence of a mandate, “those who choose to purchase health insurance would tend to be older and in poorer health,” Briglin said.

Both of those factors can drive up costs.

H.696 requires Vermonters to maintain “minimum essential coverage.”

But in the latest version of the bill, many of the details would be left to the working group, which would have to “develop recommendations regarding administration and enforcement of the individual mandate.”

Those recommendations would cover issues like exemptions related to religion and affordability, as well as what type of insurance will qualify as minimum essential coverage.

The working group’s membership would include several members of Gov. Phil Scott’s administration along with representation from the Green Mountain Care Board, the Health Care Advocate and insurers.

Briglin said the working group’s report would be timed to coincide with the next open enrollment period for health insurance.

The Scott administration initially expressed some doubts about the logistics of a state individual mandate.

But Department of Vermont Health Access Commissioner Cory Gustafson later endorsed the concept as a way to continue Vermont’s “stable health insurance market.”

Gustafson also requested, however, that the working group consider unspecified “alternatives to a standard financial penalty” for those who don’t purchase insurance.