NCPA - National Center for Policy Analysis

Vermont Tries the Public Option

May 26, 2011

This week, Governor Peter Shumlin of Vermont will sign a bill doing what President Obama and his allies have hoped to do all along: sell a public insurance option alongside competing private insurance as a first step toward a single-payer, government-run system, says David Gratzer, a physician and a senior fellow at the Manhattan Institute.

The last time Vermont's health system gained national attention was in 2004, when Howard Dean, then governor of the state, ran for president.  As governor, Mr. Dean expanded public insurance eligibility, struggling to get as close to single-payer health care as he legally could.  New regulations pushed out private insurers, reducing competition.  The result?

  • The number of uninsured Vermonters barely budged, but costs sure moved -- in the wrong direction.
  • From 1991 to 2004, according to the Kaiser Foundation, Vermont's health costs grew by 7.6 percent annually.
  • Across the United States comparable costs grew only 5.5 percent on average.
  • From 2005 to 2008, in data cited by Dr. William Hsaio, a Harvard consultant, growth in Vermont's health costs grew 8.2 percent, against a national average of 5.7 percent.

Source: David Gratzer, "Vermont Gives the 'Public Option' a Clinical Trial," Wall Street Journal, May 21, 2011.

For text:


Browse more articles on Health Issues