Employment-Based Insurance - Assignment Example

• New estimates from the Department of Medical Security, the agency struggling to implement the program, challenge the prevailing assumption that full implementation of universal health insurance will require additional state funding.
• A decision to fall back on the old mechanism of paying for the care of the uninsured, the state's Uncompensated Care Pool, would incur major costs and political liabilities. The costs, covered by a surcharge on all insured citizens' hospital bills, have hit $405 million this year and will balloon even more rapidly if ways are not found to chip away at the number of uninsured. The question is where the money will come from the beleaguered state budget, or businesses and their employees already burdened by high health insurance premiums.

For these reasons and more, those who understand the intricacies of healthcare financing say there is no way for the state simply to walk away from the problem of finding a way to pay the health costs of the uninsured. Although the 1988 universal health care law, now known as Chapter 23, was closely linked with Gov. Dukakis and his shattered presidential ambitions, the concept has a history that transcends parties and ideologies. While the Governor has yet to detail his health policy plans, he has designated the lieutenant governor-elect as his spokesman on those issues.

At the state agency charged with implementing universal health care, one key official says the biggest obstacle is the "atmosphere of defeatism" that enveloped it in the wake of Dukakis' presidential defeat and the state budget crisis. That atmosphere has obscured the achievements of the new agency, the Department of Medical Security, says deputy commissioner Hal Belodoff, but it has not quenched its conviction that universal coverage is affordable, and not the extravagance its critics have claimed. The agency has just completed calculations that show, it says, that it is possible to cover all Massachusetts residents who lack health insurance without new state funding. Overall, the agency estimates it would cost about $1 billion to provide a standard health policy to the more than 400,000 residents who currently lack any coverage, as well as to the 230,000 people who currently have expensive and limited non-group policies and would probably switch to the state-subsidized program envisioned under the law.

That $1 billion would come from three sources, the agency said. Up to $250 million would be shifted from the existing Uncompensated Care Pool; $328 million would be raised by the reviled $1,680-per-worker tax on businesses; and almost $500 million would be collected in premiums paid by those in the program according to their income. The agency staff figures that 43 percent of the $1 billion cost would be met by money already in the system -- the Uncompensated Care Pool money and premiums now being paid by people who buy non-group insurance policies. The rest would come from the new employer tax or beneficiaries' contributions. For instance, since she lost her job and with it her health insurance earlier this year, Mary Sharks of South Boston has broken her wrist, her 4-year-old son John Jr. had a second-degree burn, and her husband John was hospitalized for a recurring bone infection.

With unemployment rising, the administration will probably leave the Health Security Plan in place, but its coverage also extends to other groups, including:

• Students are no longer covered under their parents' insurance.
• "Uninsurable" disabled adults who otherwise would have to quit work to qualify for Medicaid.
• Former welfare recipients who need coverage so they can afford to take a job.
• Families with disabled children.
• Low-income community health center patients.
• Owners of small businesses and their employees, who most often complain are frozen out of the health insurance marketplace.
• Self-employed individuals and others who work at firms that do not provide insurance.

The first thing you hear is, 'We don't want to do what Massachusetts did. Given the difficulty of tackling the problem of America's uninsured at the state level, some of those most involved think this reaction is far too harsh.  If it all went away tomorrow, we'd still be in a better position to figure out what you can and can't do, and address all the policy issues, than anyone else in the country.