Friday, August 31, 2012

If we can't afford iFile, can we afford an 'exchange'?

In January 2011, the Commonwealth of Virginia Department sent us letters stating "iFile will be replaced with a new program called Free File, based on the IRS Free File program." I wrote to Del. Englin in February 2011 asking if he knew why Virginia was "required to retire the Individual iFile return filing system."

He had a prompt response:
Last year, we began the General Assembly session faced with a $4 billion revenue shortfall, having already cut $7 billion in state spending over the past four years. That meant we were well beyond having to make merely difficult choices; we were faced with choices akin to deciding which limb to cut off.

It was in that context that we moved from the iFile system run by the Virginia Department of Taxation to the Free File program. By essentially outsourcing electronic tax filing to a nonprofit, the goal of the legislation is to save some taxpayer money while still enabling Virginians to file electronically.

Additionally, since federal tax returns already come under the Free File system, standardizing the process and providing a greater diversity of choices (since Free File uses a number of existing online programs) is a worthwhile outcome. The iFile system cost the Department of Taxation a large amount of money not only to maintain, but to update year after year with the various changes in our tax law.
This raises a question: If we can't afford our own tax filing system, can we afford a health care exchange?

To say nothing of the eventual dropoff in federal funding of the Medicaid expansion, what about the cost of operating the exchange itself?

Our neighbors across the river in Maryland are already trying to figure out how they will cover the costs that "could add up to $50 million annually after 2015."

Another candidate in this election has said, "I am the only candidate who supports health care exchanges and the expansion of Medicaid." This is true. However, because of the federal mandates on private plans and one of the very policies he cites, the private sector will not be able to "offer health care options."

Another concern is his commitment "to implementing good health policy that gives consumers high quality health care choices." While that sounds good, health care "quality" as measured by the state means compliance with federal guidelines for care—not patient satisfaction and reduction of pain.

These inflexible "guidelines" function like mandates, have the full force of law, and are driving doctors out of medical practice. A shortage of doctors will increase the number of emergency room visits and thus cost more money.

This is a bad deal for Virginia.


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