Clash Over Affordability

Debate about what is affordable health insurance is heating up as The Connector gets ready to vote on the question this Thursday. The "Affordable Care Today" coalition, representing health care advocacy agencies, sent a compromise offer yesterday and is hitting the airwaves with ads today.

Also today, a coalition of health insurance and business groups is delivering a letter defining its stance to the Governor. WBUR's Martha Bebinger delves into what the opposing parties call the "make-or-break" issue for the state's universal health care law.

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MARTHA BEBINGER: As the Reverend Hurmon Hamilton sees it, health care advocates have a compromise that keeps the health care law viable while not punishing those who can not afford health insurance.

It would provide more free health insurance and more generous subsidies for residents who earn $30,000 or less a year. Above that, there would be a sliding income scale that would waive required insurance for some people earning up to $45,000a year.

Hamilton and his group, the Greater Boston Interfaith Organization, have signed on to the coalition plan and expect a fight.

HURMON HAMILTON: There's a major train wreck that's about to happen.

BEBINGER: Hamilton knows that business and some health insurance industry groups oppose anything but individual, case by case waivers.

HAMILTON: They've kind of lined themselves on the side of money. Basically saying, everything is affordable to everybody. We're going to stay the course. And GBIO and the ACT Coalition are going to line ourselves up on the side of mercy. We thought that the health care law was always about caring for people, not hurting folks.

BEBINGER: Hamilton estimates that 15-20% of the state's uninsured...or 55-to-75,00 residents would be exempt from penalties for not having health insurance under the ACT proposal. Putting more people in the free insurance group would cost an additional five and a half million dollars. There is no estimate yet for the price of more generous insurance subsidies.

MICHAEL WIDMER: Anything as sweeping as proposed by the ACT Coalition would I believe, be a death knell for health care reform.

BEBINGER: Michael Widmer, president of the Massachusetts Taxpayers Foundation is worried about the money. He says the state might find an additional 15-to-20 million dollars for subsidies this year...but it will be harder in a couple of years when the health care law is already expected to run a deficit.

In their letter today, Widmer and a group of business and health insurance leaders says exempting a large group of residents would cost everyone more money. Their argument is that if exemptions are offered, the healthy are more likely to take them while those who need coverage are more likely to buy insurance and use it.

WIDMER: That'll drive premiums up and it'll be unaffordable for employers and individuals. The reality is that the individual mandate, with individual exceptions to be sure has to be in force is health care reform is to work.

BEBINGER: Few people who are following the roll out of the state's health care law are surprised that this sticky issue of defining "affordable" has become so divisive. The state's law says individuals will only be required to buy health insurance if it is affordable.

Stuart Altman, who specializes in national health policy at Brandeis University, says no one should have assumed that forcing people to buy insurance, at any price, would be easy.

STUART ALTMAN: I've been anticipating this day since the legislation was, even before it was passed, because I could see it coming. I think it was not given enough attention during the passage of the law, because I think this group is the least politically connected group in our system.

BEBINGER: Altman leans towards the argument that most uninsured residents can afford the coverage being offered...but adds that it would make sense for the state to be flexible in the first year or so of mandatory health insurance.

Reverend Hamilton and the Act Coalition are urging Governor Deval Patrick and state house leaders to broker a compromise.

HAMILTON: And what we're saying is that if the affordability schedule is harmful, then we will have to do our level best to create a political tsunami to turn this thing around and we will do that.

BEBINGER: Aides to the governor and the senate president did not return calls for comment. A spokesman for House Speaker Sal DiMasi would only say he is reviewing the ACT request and proposal. There is, not surprisingly, a suggestion that the Connector might not be ready to vote on this issue as scheduled, on Thursday.