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Many Vermonters Likely to See Higher Health Care Costs

White River Junction — The ages of YendaMe Malia’s five children span 10 years, from toddler to “tween.”

Fortunately, all are in good health. But with a family as large as hers, visits to the doctor are routine. “Having as many children as I have, they get injured quite a lot of the time,” said Malia, 34, of White River Junction. “And it’s covered. Thank goodness for the insurance because, otherwise, I’d be stapling (their wounds) at home.”

She also gets sick herself occasionally. But despite having to support her family on an income of less than $1,000 a month, Malia can still afford to get the care she needs. That’s because her children are insured through Vermont’s state-run health insurance program Dr. Dynasaur. For herself, Malia has the Vermont Health Access Plan, or VHAP, which covers low-income adults. Malia has plenty of financial worries — mortgage payments, bills, etc. — but health care isn’t one of them.

Next year, VHAP and its sister program, Catamount Health, which has no upper income limit, will be scrapped when the state establishes its new health insurance exchange that is part of the Affordable Care Act.

When that happens, roughly 19,000 people who are enrolled in those two programs will have to buy insurance through the exchange, a kind of online shopping mall of health plans. In most cases, enrollees will have to pay significantly higher premiums, deductibles and out-of-pocket maximums that could cost thousands of dollars more than they pay now, according to Peter Sterling, executive director for the Vermont Campaign for Health Care Security, a nonprofit organization that helps people enroll in state-run insurance programs.

Most of the 38,600 people on VHAP will be covered by the expansion of Vermont’s Medicaid program, but around 10,000 of them won’t meet Medicaid’s income thresholds and will be buying their insurance through the exchange, Sterling said. Of the 11,400 people on Catamount, 9,000 will enter the exchange.

In his budget address on Thursday, Gov. Peter Shumlin proposed offering some state assistance for those people to help offset premium increases, making Vermont one of only two states to do so.

But even if Shumlin’s budget is approved, Sterling is still worried that low- and middle-income Vermonters will be burdened with additional expenses they can’t afford. Any increase in costs may convince people that they can no longer afford health insurance.

“If we raise the cost of health care for this population, we’re going to increase the number of uninsured,” Sterling said. “What happens if you have $600 more out of pocket? That’s an enormous increase. They would go into medical debt.”

These changes are news to Malia. “I haven’t heard anything,” she said. “They don’t inform us of anything really until it changes.”

If the exchange were rolled out today, Malia’s income as a personal care attendant for children with autism is still low enough to qualify for Medicaid. She is looking for more clients and said she would consider other kinds of jobs to bring in more income. Ironically, if she earns too much money, then she may no longer qualify for Medicaid and could find herself with costlier health insurance.

Should this happen, Malia said, she would likely forgo care. “I wouldn’t go to the doctor,” she said. “Right now, I can’t even afford the gas for my truck, so I’m taking the bus to take my child to child care.”

Sharon Irwin, a 35-year-old Hartland resident, is also enrolled in VHAP. Irwin’s husband works at the Upper Valley Food Co-op in White River Junction while she stays home to raise their 3-year-old child. She was unsure how she would be affected when the exchange goes into effect next year. If her out-of-pocket costs go up significantly, however, she and her husband would likely cut out preventive care. “We would definitely skimp on things that we didn’t feel was an imminent health threat,” she said.

Without state assistance, an individual on VHAP could see premiums and out-of-pocket costs rise more than $2,000 annually to buy a plan similar to the one she has now, according to estimates provided by the Vermont Campaign for Health Care Security. If Shumlin’s plan is approved, that same person would see an increase of less than $500. Those earning $28,728 a year and enrolled in Catamount would pay up to $4,600 more for health insurance than they do now, according to the Campaign’s estimates. Shumlin’s plan would cover all but $600 of the extra expense.

The money to help people pay the higher costs would not come from additional taxes, said Shumlin’s spokeswoman Sue Allen. The $10.3 million he’s seeking to offset increases to premiums and out-of-pocket costs would be funded by a combination of money already coming into the system, through savings and federal subsidies.

In a telephone interview Thursday, Shumlin said he hoped to ease the burden on low-income Vermonters as much as possible. “Really our challenge is, we’re sitting here with a system that’s mandated by the feds that is less generous than Vermont’s current system,” he said. “We didn’t feel it necessary at the higher income levels to plug the entire hole, but we did feel we had to plug most of it because obviously we’re not going to ask Vermonters who are already struggling to pay for health insurance to suddenly have the federal government pull the rug out from under them. We want to keep folks insured in Vermont as we move to single-payer.”

Now it’s up to lawmakers to fix the problem and make sure that they give uninsured Vermonters and those on state programs a reason to get health coverage, Sterling said. “No one should pay more than they are paying now,” he said in a statement responding to Shumlin’s proposal. “Anything else is a major reversal of the progress Vermont has made on health care reform and jeopardizes Vermonters health and financial security.”

Chris Fleisher can be reached at 603-727-3229 or cfleisher@vnews.com.