Transcript Health Care Reform: Massachusetts One Year Later Sarah Iselin Massachusetts Division of Health Care Finance and Policy October 26, 2007

Health Care Reform:
Massachusetts One Year Later
Sarah Iselin
Massachusetts Division of Health Care
Finance and Policy
October 26, 2007
The Massachusetts Law:
Why So Much Attention?
• Ambitious goal: Near universal coverage
• Transcends ideology
 Bipartisan support
 Combines policy solutions from the right and the left
 Partnership between federal government and state
• Novel approaches
 Individual mandate, employer responsibility, insurance
market changes
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Massachusetts:
The Building Blocks for Reform
• Relatively low rate of uninsurance
• History of health coverage expansions
• Broad Medicaid program
• 1115 Waiver
• Uncompensated Care Pool
• Highly regulated small group and individual health
insurance markets
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How Will We Get There?
• Medicaid expansions and restorations
• Subsidized coverage for low-income adults
• Changes to the insurance market to help individuals
and small businesses
• Individual mandate
• Employer responsibilities (for firms with > 11 employees)
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Massachusetts Health Reform:
How Do the Pieces Fit Together?
Percent of State’s Total Uninsured Targeted by
Different Aspects of Law
"Affordable
Products" and
Individual Mandate
(>300% FPL)
44%
Medicaid Expansion
19%
Commonwealth Care
37%
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Medicaid: +56,000 Members
1,150,000
1,100,000
MassHealth Caseload
• Discontinued
MassHealth Basic
• Premiums for some
optional populations
Commonwealth
Care
Health Care
Reform
August 2007
1,090,000
Initial Gateway rollout
1,050,000
1,034,000
1,000,000
950,000
900,000
MassHealth Essential
850,000
800,000
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Commonwealth Care: 127,000+
Enrollment (thousands) as of the first of the month
120
Premium-paying
No premium
100
80
60
40
20
0
Nov '06 Dec '06 Jan '07 Feb '07 Mar '07 Apr '07 May '07 Jun '07
Jul '07 Aug '07 Sep '07
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Commonwealth Choice:
6 Plans, 36+ Products, 8,300+ Members
Enrollment by Health Plan as of 10/1
Total: 6,196 Subscribers
Health New
England, 201,
3%
Fallon
C ommunity
Health Plan,
633, 10%
Blue C ross Blue
Shield of MA,
2269, 37%
Harvard Pilgrim
Health Plan,
1,450, 23%
Neighborhood
Health Plan,
1,147, 19%
Tufts Health
Plan, 496, 8%
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Meanwhile, Uncompensated Care
Demand is Falling
UCP Hospital Visits and
Admissions
Growth in Hospital UCP
Costs
0%
4%
-2%
2%
-4%
0%
-4.7%
-6%
-8%
2.0%
-0.2%
-2%
-4%
-7.9%
-6%
-10%
-12%
-11.9%
-8%
-8.6%
-10%
-14%
PFY04 to
PFY05
Growth
PFY05 to
PFY06
Growth
PFY06 to
PFY07
YTD
Growth*
PFY04 to
PFY05
Growth
PFY05 to
PFY06
Growth
PFY06 to
PFY07
YTD
Growth*
* Growth rate reflects October-August data in both periods
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Individual Mandate: The Benefits
(Minimum Creditable Coverage)
Benefits
•
•
•
Preventive and primary care (at least 3 visits prior to deductible)
Emergency services, hospitalization benefits, ambulatory patient
services, mental health services and all state mandated benefits
Prescription drug coverage
Cost-sharing
•
•
•
Deductible capped at $2,000 for individual coverage and $4,000
for family coverage
Separate drug deductible may not exceed $250 for individual
and $500 for family coverage
Maximum out-of-pocket spending for in-network services capped
at $5,000/$10,000
 Must include the upfront deductible, most co-insurance, and any
services that require $100 or more in co-payments
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Individual Mandate:
The Affordability Schedule
SINGLES
Annual Income
$0 - $15,315
$15,316 - $20,420
$20,421 – $25,525
$25,526 – $30,630
$30,631 - $35k
$35,001 - $40k
$40,001 - $50k
Over $50k
COUPLES
Monthly
Premium
$0
$35
$70
$105
$150
$200
$300
Affordable
Annual Income
$0 - $20,535
$20,536 - $27,380
$27,381 - $34,225
$34,225 - $41,070
$41,071 - $50k
$50,001 - $60k
$60,001 - $80k
Over $80k
FAMILIES WITH CHILDREN
Monthly
Monthly
Premium
Annual Income
Premium
$0
$0 - $25,755
$0
$70
$25,756 – $34,340
$70
$140
$34,341 - $42,925
$140
$210
$42,926 - $51,510
$210
$270
$51,511 - $70k
$320
$360
$70,001 - $90k
$500
$500
$90,001 - $110k
$720
Affordable Over $110 k
Affordable
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Individual Mandate: The Tax Form
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Employer Responsibilities
• Fair Share Contribution
 Make “fair and reasonable” contribution to health
insurance or pay assessment (no more than $295 per
employee per year)
– Employee take-up rate of 25% or more, or
– Offer to pay 33% toward cost of coverage
• Offer Section 125 Plans or could be subject to Free
Rider Surcharge
 Allow employees to make pre-tax contributions to health
insurance or pay “fair share” charge
• Applies only to employers with ≥ 11 full-time
employees
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Challenges Ahead
• Education, outreach and enrollment
• Sustaining public support
• Ensuring access for the newly insured
• Financing – strong state economy
• Continued federal support for waiver renewal
• Maintaining strong safety net for those who will
remain uninsured
• Moderating health care cost trends
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