Massachusetts Effect
With the first major statewide attempt at universal healthcare access under way in Massachusetts, everyone from presidential candidates to uninsured families on the other side of the U.S. is watching to see if the state’s plan will succeed. If so, it could become the basis of a national healthcare plan.
Massachusetts healthcare reform became law April 2006 as part of the Act Providing Access to Affordable, Quality, Accountable Health Care. It requires that virtually all state residents either purchase health insurance or get coverage through state-sponsored insurance for people with low incomes (May 2007 The Hospitalist, p. 1). The plan, based on insurance market reforms, merges the individual and small-group insurance market, allowing residents to get lower group insurance rates.
The law required coverage by July 1, and residents must show evidence of their coverage on their income tax return or face a substantial fine—up to 50% of the cost of a health insurance plan.
Many Massachusetts residents get healthcare coverage through their employers. The state plan requires companies with more than 10 employees to provide coverage or to pay a “Fair Share” contribution of up to $295 for each employee each year. Employers must also offer a “cafeteria plan” that allows workers to purchase healthcare with pre-tax income.
The bill created the Commonwealth Health Insurance Connector, which offers affordable, quality insurance to individuals and small businesses. The Connector board approved plans offered by seven insurers that include several options.
As for low-income residents, sliding-scale government-funded subsidies are provided by the Commonwealth Care Health Insurance Program (C-CHIP). As of June 1, nearly 80,000 low-income adults had enrolled in C-CHIP. In addition, the statute expanded MassHealth (Medicaid and SCHIP) coverage for children of low-income parents and restored MassHealth benefits such as dental and vision care.
The plan also includes a system for quality standards and for publicizing performance of providers.
The money for the plan comes from several sources. Gov. Deval Patrick has requested $1.725 billion to fund the program in the next fiscal year. This will supplement federal Medicaid payments, employer contributions, and general revenues.
