Health Insurance Articles
How The Desire For Universal Coverage Has Affected Massachusetts
2009-10-25
As the U.S. House and Senate move towards legislation to reform the American healthcare system, it is instructive to look at the results achieved in the state of Massachusetts. This is because this state passed the most comprehensive health insurance bill in the nation three years ago. The changes implemented there are similar in many ways to the ones currently being considered in Congress. The elements focus primarily on providing health insurance coverage for as many of the state's residents as possible. They do this by creating a regulated exchange to control costs - especially for persons purchasing individual plans - and keeping prices affordable for low-income workers, the group for whom it is most challenging to provide reasonably priced, continuous coverage.
During the past three years the changes in Massachusetts have turned out to be a mixed bag of results. The state has actually managed to insure 96 percent of its residents - the highest percentage in the nation. This number exceeds the goals included in some of the plans currently before Congress. But the cost to the state of subsidizing previously uninsured individuals has climbed continuously, and will probably cost $1.3 billion by 2011. This is twice the amount the state paid when the bill first was first implemented.
Health insurance coverage rates have declined for many state residents purchasing individual insurance. This is especially the case with younger policyholders. Older holders are actually paying comparable rates to what they were paying before the legislation went into effect. For the most part, private premiums and employer-based policies have become more expensive, and the less costly plans still leave customers with high deductibles and responsibility for a significant share of their medical bills.
Overall, while the Massachusetts legislation has significantly increased the number of people carrying health insurance, it has not managed to control the cost of medical bills. The rate of medical bankruptcies in the state has not declined, although it was an objective of the recent reform. The changes have been more costly than anticipated, and it is not clear whether its provisions are sustainable over the long term. To be fair, the years since the recent laws went into effect have spanned the worst economic recession since the Great Depression and high unemployment rates mean that more people cannot afford private plans. A more robust economy may have provided a more hospitable environment for the Massachusetts plan. Nonetheless, for these strategies to be viable, they need to be effective during difficult times as well as affluent years. We can only hope that the federal plan makes use of the successful ideas adopted by the state, and improves on its less successful efforts.
