"Defining MINIMUM Creditable Coverage" by Marylou Buyse

During last week’s Connector hearing on the proposed changes to the Minimum Creditable Coverage (MCC) regulations, we heard a resounding message from representatives of the employer community. Employers want to be able to provide their employees with high quality health insurance benefits that meet the standards for MCC. However many employers have been stretched to their limits as they struggle to keep up with the many requirements of the Health Reform Law, including ensuring that the coverage they provide for their employees meets the MCC requirements that were passed just this last year, and that will not go into effect until January 1, 2009.

Now the Connector Board is once again looking to make changes that would add more requirements to MCC. Adding to MCC will force thousands of individuals to discard their previous plan and purchase one that the State has deemed acceptable. These plans would likely cost consumers more money. Many of these individuals are enrolled in health plans that most of us would consider pretty good coverage but may vary slightly from the list of MCC requirements. These individuals would still be considered out-of-compliance with MCC and the individual mandate and have to pay substantial tax penalties; even if they were happy with their coverage and even if their coverage complied at the time they bought it.

Making changes midstream will cause disruption within the market, as many individuals and employers have already selected their health plan for the coming year, based upon the Connector’s current MCC rules.

The more specific requirements that are added to MCC, the greater the likelihood that individuals enrolled in a self-insured health plan, or those who get their insurance from an out-of-state or national employer will not meet MCC. Such an approach would leave thousands of individuals high and dry and subject them to tax penalties.

The Connector should prevent disqualifying the coverage for hundreds of thousands of residents and avoid unnecessary burdens on individuals that currently have coverage and the employers who provide it to them. Among the findings of the Blue Cross Blue Shield of Massachusetts Foundation's November 2006 report, The Massachusetts Health Reform Law: Public Opinion and Perception, were the principles that minimizing disruption in the insurance marketplace should be a priority and that the state should make it easy for employers and consumers to participate in the insurance market.

One change to the regulations that has caused great concern is to the requirements governing Federally-qualified high deductible health plans (HDHP). When the Connector originally considered the current standards for MCC, we supported the Board’s decision to include Federally-qualified HDHP as part of the standard for MCC. These plans serve as innovative, low-premium options for individuals and employers, many of whom fund accompanying health savings accounts (HSAs) or health reimbursement arrangements (HRAs) to help cover expenses subject to the deductible. The proposed changes to the regulations would disrupt coverage for the 38,000 Massachusetts individuals currently enrolled in these plans and make Massachusetts the only state to prohibit these products.

Health reform promised the introduction of new insurance options for Massachusetts employers and individuals. It was never the intent to take away quality and affordable health insurance products. However the regulations, as currently drafted, and many of the proposals offered by members of the advocacy community will actually take affordable options away from consumers by imposing additional requirements to the minimum standards. Doing so not only evades the state’s mandate review and approval process, but it jeopardizes the ability of consumers to find quality and affordable health insurance that might meet their needs and instead requires consumers to purchase more expansive and expensive plans than they may want or need. The end result will be that even more individuals will be subject to significant tax penalties even when they have good quality health insurance coverage; it just doesn’t match what the State has determined acceptable.

When it comes to health insurance, one size does not fit all. We therefore encourage the Connector to keep the standards for MCC minimum.

Marylou Buyse, MD
President, Massachusetts Association of Health Plans