The Massachusetts health reform was a distinct departure from previous reform strategies. The two most significant pieces of the approach were a set of insurance market reforms and a set of public financing reforms.
The insurance reforms were designed to make coverage easier to obtain and portable from job to job. The public program reforms redirected subsidies paid to safety net hospitals for treating the uninsured into subsidies to help the low-income uninsured buy health insurance.
The results of the first two years of implementation of both these key elements have been broadly positive.
Approximately 350,000 Massachusetts residents, or roughly half the state's estimated uninsured, have obtained coverage, and there has been a significant decline in taxpayer subsidized "free care".
While, to date, both of these key elements have shown progress, challenges remain as their implementation continues.
It is significant that of the 350,000 newly coverage individuals, approximately 110,000 have obtained coverage on their own without any public subsidy. However, only 18,000 have obtained coverage through the newly created Connector.
The remaining challenge is to bring online the ability for small businesses to make coverage through the Connector their group health plan for their workers, which is anticipated to become available this Fall.
At the same time, with roughly 176,000 enrollees in the new Commonwealth Care program, enrollment for the subsidized population has occurred faster than initially anticipated. This has had the effect of creating an issue for the pending renewal of the state’s Medicaid waiver. The 2006 agreement between state and federal officials specified redirecting federal and state Medicaid funds previously going as special payments to safety net institutions into new subsidies for covering the low-income uninsured. The higher and faster enrollment in Commonwealth Care means that this funding shift now needs to be accelerated. What is important is that the fundamental policy shift—from subsidizing providers to subsidizing people— is not now reversed or diluted in a new waiver agreement.
Policy Analyst, Center for Health Policy Studies
The Heritage Foundation
Edmund F. Haislmaier
Senior Research Fellow in Health Policy Studies, Domestic Policy
The Heritage Foundation
This program aired on August 14, 2008. The audio for this program is not available.