The Question of Affordability

On the one year anniversary of an agreement that launched the state's universal health insurance law, there are marked differences about how to define a central element of the law: affordable coverage.

The definition is key because the requirement that individuals have health insurance only applies if affordable coverage is available.

The Connector Board began discussing "what is affordable" yesterday with two contrasting views, as WBUR's Martha Bebinger explains.

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MARTHA BEBINGER: On the one hand, the board heard from MIT economics professor Jonathan Gruber who says lets define affordable as what people are already buying voluntarily. He says only seven percent of employees nationwide who are offered health insurance in the workplace turn it down. His conclusion is that new health plans the uninsured will be able to buy starting next month are largely affordable.

JONATHAN GRUBER: The strongest evidence is that people, even low income people, are currently buying health insurance.

BEBINGER: The Connector board must also decide what is affordable for residents who qualify for subsidized health insurance. Gruber, who is also a Connector board member, says that most people in that group, who earn less than $30,000 a year, report some miscellaneous spending.

GRUBER: The vast majority of people below three times poverty do have room in their budgets to pay for Commonwealth Care premiums.

BEBINGER: While Gruber argues against waiving penalties for not having insurance for any income groups, Christine Barber with Community Catalyst, says that residents who earn less than that $30,000 a year can afford little more than life's necessities, and should be exempt. For residents who must buy coverage on their own, Barber recommends a sliding scale that starts at about $100 dollars a month at $30,000 a year and goes up to $420 a month for residents who earn $60,000. Barber says the state might ask more of residents after the law has been in effect for a few years, but should give the uninsured more of a break to start.

CHRISTINE BARBER: It's a new idea, its something that hasn't been tried yet in the united states, we're not sure how the public is going to accept this. So rather than coercing people to buy insurance and have them face financial penalties, we want most people to voluntarily chose to buy insurance.

BEBINGER: The proposal would exempt more than half of the state's uninsured residents who earn less than 30, thousand dollars a year, although more than a third of that group has already signed on for free or subsidized insurance. Business leaders say that sweeping exemptions for uninsured individuals would undermine the shared responsibility premise on which the law was founded. Connector director Jon Kingsdale says it might also drive up the cost of coverage for the uninsured because those who are sick and need a health plan would be more likely to buy one than those who are healthy. Kingsdale says that will make it more difficult to provide affordable commercial and government subsidized health insurance through the program called Commonwealth Care.

JON KINGSDALE: To spend a half billion dollars next year on making Commonwealth Care accessible and then determine, but it costs too much to be affordable, would be a prescription for moving away from/the intent of this reform.

BEBINGER: The board is scheduled to vote on draft affordability guidelines a week from Thursday. Connector board chairman Leslie Kirwan says she isn't sure yet if she support waiving penalties for uninsured residents in low to moderate income groups.

LESLIE KIRWAN: How many people can we allow to fall outside of the mandate and still be achieving the core intent of health care reform, and that's what we're going to struggle with as a board.

BEBINGER: Uninsured residents will have the option of appealing whatever the board decides is affordable. The Connector has not decided on a process for reviewing and settling those appeals. For WBUR, I'm Martha Bebinger.

ANCHOR TAG: To comment on this story and other issues related to the state's new health care law, go to WBUR. Org and click on the the blog, "CommonHealth."