Expansive Health Plan Won’t Fit All States

After months of negotiations, Massachusetts passed legislation this week that promises near-universal healthcare coverage -- the most inclusive plan any state has crafted.

But experts say the state’s unique circumstances will make the measure difficult to replicate.

The 145-page bill, passed Tuesday by the state’s heavily Democratic Legislature, is expected to be signed soon by Gov. Mitt Romney, a Republican who probably will seek his party’s presidential nomination in 2008. The package emphasizes individual responsibility -- requiring all state residents to obtain health insurance by July 2007 -- and spreads costs among citizens, employers and government.

“It is an inspiration for the rest of the nation, but not necessarily a model,” said Drew Altman, president of the Kaiser Family Foundation in Menlo Park.

Massachusetts is a small state, he noted, with a relatively low number of uninsured people -- only about 10% of the state. It has a low unemployment rate and a large base of employers who traditionally have provided health coverage for workers.

Lawmakers here also have tried to provide coverage for the uninsured, going back to the 1980s, when then-Gov. Michael Dukakis signed a universal healthcare plan that later was repealed. And Massachusetts long has found creative ways to use public programs to pay medical costs for uninsured people.

But Altman said the most important factor was the way Massachusetts managed to unite conflicting factions.

“We have had this Grand Canyon divide about how to solve the healthcare problem,” he said. “And Massachusetts put together a Cuisinart-style package that breaks through the ideological logjam by borrowing from the left, the right and the center.”

Salvatore F. DiMasi, Speaker of the Massachusetts House of Representatives, said lawmakers wanted to take advantage of a brief federal funding window that guaranteed $385 million in annual subsidies if the state could reduce its uninsured population.

“We didn’t let ideologues stand in our way,” he said. “It was more, can we make these principles work, and how do we make them work by insuring everybody in Massachusetts and reducing healthcare costs at the same time?”

Massachusetts also managed to reassert healthcare reform as a critical national issue, said Dr. Robert Blendon of the Harvard School of Public Health.

“It is a backlash to all the cutbacks,” he said. “It could be the first of the countermoves of healthcare not being at the top of the agenda, with states just cutting costs and cutting benefits.”

Among its many elements, the Massachusetts plan establishes a sliding scale to determine who can and cannot afford health insurance. The measure also creates a health insurance “connector” to link businesses and individuals with insurance providers.

All state residents who can afford private insurance will face tax penalties if they do not obtain coverage. Private insurance companies will be eligible for government subsidies to increase coverage for children and the working poor. Small businesses that do not offer insurance will be charged an annual assessment of $295 per employee. In addition, families will be required to cover dependent children up to age 25.

The state managed to “slice up the problem,” said Grace-Marie Turner, head of a Washington health policy research group called the Galen Institute.

“It said who is uninsured, why are they uninsured, what do they need to make this work. That is what other states need to look at to make this work.”

In 1974, Hawaii became the only state to introduce an employer mandate, where businesses must participate in employee insurance plans, said health policy analyst Laura Tobler of the National Conference of State Legislatures. Three years ago, Maine unveiled a near-universal healthcare program that since has encountered a series of setbacks.

Also in 2003, California’s legislature passed an employer mandate that was overturned in a ballot initiative the next year.

Tobler said that while the Massachusetts legislation could be a catalyst in California, “the population of the uninsured in California is larger and more diverse in income,” making it difficult to copy Massachusetts’ model.

Rhode Island, New Mexico and Oklahoma recently expanded their Medicaid programs, Tobler said, and at least 20 other states are considering Medicaid reform proposals. Those states may study Massachusetts as a test case, she said.

“A lot of other states are going to look at it and say, ‘Hmm,’ ” Tobler said.

“But Wyoming is not going to look at Massachusetts and say, ‘This would work here,’ because the demographics are so different.”

Vermont and Wisconsin also are preparing healthcare reform efforts, said AARP policy director John Rother. Like Massachusetts, he said, those states have relatively small uninsured populations.

“It is unimaginable that Florida, California or Texas could take this action,” he said.

Rother said the Massachusetts healthcare reform bill is “not exactly a model for the rest of the country -- but it may be one of several models. It is great that states are making this effort, but when you get closer to it, it is by no means clear how this is going to turn out. And the magnitude of the problem is just so very different from state to state.”

Still, Rother said, “Massachusetts has showed that something can be done. It is not hopeless.”

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Changes in Massachusetts

Highlights of the bill, which awaits the governor’s signature:

Creates a mechanism to connect individuals and small businesses with healthcare choices; this “connector” allows insurance portability as people change jobs

* Creates a subsidized insurance program with sliding-scale premiums and no deductibles

* Lets young adults remain on parental policies two years past when they are no longer dependent or until they turn 25, whichever occurs first

* Creates a “fair share” contribution for employers who currently do not provide insurance

Source: Massachusetts State Legislature conference committee report

Los Angeles Times