Tuesday, June 3, 2008

Comprehensive Health Care Reform and Massachusetts--Are We On Our Way To a Very Different Debate?

The Massachusetts health care reform law appears on its way to:
  • Covering two-thirds of those who did not have health insurance on the day it was enacted--about 400,000 people by the end of 2009.
  • Covering most of those who were uninsured in households with incomes below 300% of the federal poverty level--below which the plan pays all or most health insurance premiums.
  • Offering health insurance plans to middle-income people that are still largely unaffordable for those families making less than $110,000 a year––people for whom the state has generally canceled the individual mandate that they must buy coverage.
  • Racking up costs well above what was first estimated. The plan looks to be coming in 38% higher than originally estimated for its first year and the Governor is now estimating second year costs 50% higher than the original estimate––from $725 million to $1.1 billion for the 2008-2009 fiscal year.
  • Developing an annual cost trend for the program's insurance programs, Commonwealth Care and Commonwealth Choice, in the 10% to 15% range.
So, lots more people, particularly lower-income residents, are covered but the program's costs are unsustainable.

Massachusetts was a bold and very difficult piece of legislation to accomplish. It has often been described as an experiment. The greatest contribution experiments make is to tell us a lot about what works and what doesn't so we can move on successfully from there.

Massachusetts policymakers will now work to improve the plan. But without a major cost containment effort--way beyond anything they are even talking about now--they won't make much progress.

Whatever happens next in Massachusetts, this plan's results, a plan that closely parallels Barack Obama and Hillary Clinton's national health reform plans, will likely now undermine both state and federal attempts to copy it. Neither the Congress or any state legislature is going to embark on a plan whose costs have quickly become so problematic for such an incomplete result.

Now before all my readers in the Bay State quickly complain I'm deriding the Massachusetts plan again, let me be clear that this is not a bad outcome. If there has been one primary frustration in the health care debate since the 1960s it's that we too often just debate things, never try anything, and never build on our successes and failures.

The Massachusetts health reform law is valuable because it tells us so much.

My primary takeaway from the Massachusetts health reform law is that attempts to incrementally deal with access first, while avoiding a major restructuring of the system to simultaneously deal with costs, will only lead to an incomplete result in improving access and costs that cannot be sustained.

What Massachusetts has accomplished in passing this law is the most any state or Congress could have done--or ever did. As I have said many times on this blog, the political leverage just hasn't been available to do the job in full. That was true in 2006 when this law was passed and it's true even today.

But in the coming months, results from the Massachusetts health care experiment are going to become well known.

While many will say, "Look at that cost mess let's forget major health care reform," I would hope more people would say it is clear we are going to have to take a more fundamental look at real health care reform that cuts across both the access and cost containment lines.

Even bolder plans, that everyone says are politically impossible today, just may take on a new life because it will be clear the Massachusetts outline isn't going to do much more than bust the budget for an incomplete result. Moving the debate to a more viable place would be a very worthwhile contribution for Massachusetts to make.

A few weeks ago, I said watch the Wyden-Bennett health care plan. It combines many of the things conservatives want--a decoupling from the employer-based system using an individual defined contribution model--with many of the things liberals want--adequate premium support for consumers and open access for everyone. The fact that the CBO rated Wyden-Bennett revenue neutral early in the game also looks pretty good in light of what's happening in Mass.

Other fresh ideas are on the table. Ezekiel Emanuel's health plan, for example, that also decouples health care from the employer, puts private health insurance in the hands of the consumer, and substitutes the many ways we pay for health care today with a single VAT tax that automatically creates a national budget for health care expenditures, has also gained lots of attention.

The National Leadership Coalition on Health has had a comprehensive plan on the table for sometime. Its bipartisan approach and many supporters from a broad cross section of the stakeholders also makes it a serious proposal that could now get more attention.

To me progress is a matter of keeping the debate moving forward toward a successful outcome by building on valuable experiences.

That, I will suggest, is what the Massachusetts experiment can now become. It is not something to be dismissed--nor is it something to defend for the sake of just defending it.

Related posts:

First Year Results in Massachusetts' Health Care Reform Undercut Barack Obama's Health Care Reform Strategy

John McCain's Health Care Plan and the Uninsurable--There Are Better Fixes Than the Ones He's Proposed
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