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PUBLIC AWARENESS ON PENALTIES FOR REMAINING UNINSURED IS LACKING by James Roosevelt, Jr.

Earlier this week, The New York Times published an article that rightly laid out the challenges of government mandating insurance coverage to its citizens. I agree with the comments made by Diane Rowland, executive vice president of the Henry J. Kaiser Family Foundation, a non-partisan organization that focuses on health care policy analysis and large-scale public heath information. She said “that an individual mandate is the only alternative to government provision of coverage if you hope to achieve universal coverage.”

Universal coverage has been the goal of Massachusetts’ health care reform efforts from the very beginning. Our experience is reflective of a profound social revolution with the fits and starts of any worthwhile, ambitious undertaking. Right now, we in Massachusetts are at the first real critical juncture of the implementation of health care reform: having our citizens enrolled by year’s end, before they suffer a financial penalty. The good news is that Commonwealth Health Insurance Connector Authority claims that enrollment is exceeding expectations. Health plans such as Tufts Health Plan want to make it as easy as possible for people to enroll, and as a result, Tufts Health Plan is suspending usual operational requirements so that any individual who enrolls with us through our individual channel by Dec. 31 will be covered and thus, able to avoid the 2007 penalty.

The bad news is that for many, health insurance continues to be a “grudge purchase,” with people hedging their bets that illness won’t strike or accidents won’t happen.

The challenge lies in ongoing education of the public. Many are simply unaware of their responsibilities going forward, and the costs that they will incur if they choose to ignore the mandate.

To date, the focus has been on the $219 penalty that will be incurred at tax time if people do not enroll in health care reform products by Dec. 31, 2007. What is less well known and needs to be brought to the attention of the public is that in addition to the 2007 penalty of $219, there is a monthly penalty for remaining uninsured, which is based on half the cost of the lowest premium in the market. This could translate to $100 to $150 for each month that an individual is uninsured. In other words, if someone waits until June 2008 to purchase insurance with a July 1 effective date, they will accumulate roughly six months worth of penalties. That’s a total cost of between $600 and $900—and that person would still be uninsured. There has not been enough public discussion about the cumulative effect of these penalties.

As the year draws to a close, we can’t limit ourselves to thinking about December 31, 2007 enrollment. Instead, we need to be engaged in a large-scale public education effort on what it means to remain uninsured in 2008 and move people towards the goal of universal coverage.

James Roosevelt, Jr., president and CEO, Tufts Health Plan

This program aired on November 30, 2007. The audio for this program is not available.

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