For two years, Vermont Gov. Peter Shumlin has concealed his plans for financing single-payer health care. His lead consultant, Jonathan Gruber, has admitted to deceptive policymaking and called lack of transparency “a huge political advantage.”
But at least one man knows what Vermonters can expect to pay for Green Mountain Care and isn’t afraid to tell.
Peter Galbraith, son of famed economist John Kenneth Galbraith, former U.S. ambassador and two-term Democratic state senator from Windham County, holds the distinction of being the only lawmaker to have put forward a plan for financing Act 48, Vermont’s publicly financed health care program.
Although his bill never became law, the senator has a clear picture of what Vermonters can expect when Shumlin reveals his single-payer financing plan in January — a plan that will attempt to lay a $2.2 billion tax on the backs of about 630,000 Vermonters.
“If you do it on the sales tax, it would require a sales tax of 30 percent. If you do it on the income tax, you would have the bottom rate be 15 percent and the top rate be 30 percent. That would make the top effective tax rate in the state of Vermont about 73 percent,” Galbraith told Vermont Watchdog.
According to Galbraith, such taxes are highly impractical, making the only real options a payroll tax, mandatory premiums or a combo.
“If you want to raise $2 billion, there’s only a couple of ways you could do it. One is to have a payroll tax, which would be painful, but would more or less track how health care is paid for now,” Galbraith said.
The Galbraith plan proposed an 11 percent tax on employers and a 2 percent tax on employees, which he said aligns with current health care expenses for business.
The other option — one Galbraith doesn’t like — is mandatory premiums.
“If you just used premiums, every Vermonter not excluded from Green Mountain Care — and my proposal would have excluded seniors — would have to pay $5,200. That’s about $20,000 for a family of four.”
