The Massachusetts Health Plan regulator, "The Commonwealth Connector," has issued new rules that will exempt an estimated 20% of the uninsured from a state legal requirement to purchase health insurance.
Since the health plan bids came in last month, it has been clear the prices would not make it possible for Massachusetts to be able to implement its mandate that all citizens have health insurance or pay a penalty.
Given what they are required to work with, the "The Commonwealth Health Insurance Connector Authority" has come up with a rational way to implement the mandate--such as it is.
Fundamentally, the problem they are dealing with is one of cost. Health insurance just costs too much in Massachusetts and everywhere else in our country.
Good for the "Connector" in that they have done as much as anyone could have.
Massachusetts is also being successful in expanding the number of people who will receive a full subsidy for a health insurance plan:
- "The income threshold for an individual who receives a full subsidy and does not have to pay monthly premiums for the Commonwealth Care health insurance program would increase from 100 percent of the federal poverty level ($10,210) to 150 percent ($15,315).
- "For those earning between 151 and 200 percent of the federal poverty level ($20,420), the monthly premiums for Commonwealth Care would be reduced from $40 to $35."
But let's not have any false celebrations here. The Massachusetts experience tells us that closing the uninsured gap, and covering everyone, is something that has a cost no state can afford on its own. While this is a practical solution, it is not an elegant one--or a comprehensive one.
Under the program, a family of three earning $50,000 per year will have a health insurance plan available to them but it will cost about $7,000--and that plan has a $2,000 per person deductible. Before the Connector's ruling on exemptions, that was mandatory. Now, a family making $50,000 is exempted from the mandate if it can't find a plan for less than $3,840 per year. Based upon the "Connector's" health insurance rates, they won't find one.
They are exempted from the mandate. Problem solved.
Well, not exactly. That family still doesn't have insurance and it won't. If that family could find the money, it would pay $7,000 and get a plan with a $2,000 individual deductible ($4,000 family). The plan does have some limited first dollar office visits.
A $7,000 cost for a plan with a huge upfront deductible is no great deal for this family. It is no better deal to have the state now say, "Never mind."
It's worse for older citizens in this age-rated program. A 56-year-old would pay $351 to $505 in eastern Mass for the $2,000 deductible plan. The exemption doesn't help them get insurance.
It's not always rosy for people who still find themselves under the requirement to buy a health insurance plan. For example, a couple making $41,000 a year would be expected to pay $270 per month or $3,240 per year for a plan with a $2,000 deductible--if they can find one for that price. Not a lot for health insurance but a great deal to be expected of a couple making $41,000 a year.
The lesson from Massachusetts is not that they have found a practical way to do comprehensive health care reform.
The lesson is that a state cannot do it all by themselves.
In Massachusetts, the good news is that the glass is half full--a lot of people will have coverage who didn't before particularly between 100% and 200% of the federal poverty level.
The bad news is that the glass is half empty--lot's of people have been "exempted" from the new universal health care coverage mandate but still can't afford it. And on this point, Massachusetts has hit one big brick wall--and they don't have the means to go further.
That isn't trash talking. It is the reality we all need to face when trying to understand what the Massachusetts health care reform law means to the rest of us.
You can get the full exemption scale at the Connector Website.
See my earlier posts on the Massachusetts Universal Health Plan