The Massachusetts Health Reform Law of 2006 - Research Paper Example

An Analysis of the Massachusetts Health Reform Law of 2006 1.0 Executive summary Recently the health sector in Massachusetts got a boost when the an Act intended to provide access to affordable, quality, accountable health care was passed. The target is given and ensures access to affordable health insurance coverage to all residents of Massachusetts. In brief the Act aims at modernizing health insurance laws and by this it removes all setbacks in purchasing health insurance. Another aim of the legislation is to redirect current government assistance for uncompensated care to health insurance premium subsidies that is from institutions to individual. It is also aimed at ensuring individual responsibility. The Act also provides for employer responsibility and other provisions as shall be outlined. The US healthcare can be seen as a unique policy because it treats medical healthcare as any other commodity that is sold or bought in the market place (Marcia Angell, 2008). That healthcare is distributed according to ability to pay and not the need. This plan was enacted in 2006 and looks forward at covering 500,000 to 750,000 residents of Massachusetts state. How this will work is a matter that many residents are anxious to observe. 1.2 Provisions of the Act The following is an in-depth analysis of the provisions of this particular health Act. As earlier mentioned the act intends to provide access to quality, affordable, accountable Health Care was passed. The target is given and ensures access to affordable health insurance coverage to all residents of Massachusetts. In brief the Act looks forward to Modernizing health insurance laws and by this it removes all setbacks in purchasing health insurance. Another aim of the legislation is to redirect current government assistance for uncompensated care to health insurance premium subsidies that is from institutions to individual. The Massachusetts health care reform legislation was passed into law on April 2006. The intention of the new law is to provide almost same coverage of the Massachusetts people. The legislation imposes responsibility on an individual for the purchase of health insurance and advocates for shared responsibility in meeting the expenses of the coverage. The law has provisions on Mass Health expansion, individual mandate, Commonwealth Care health insurance program, employer requirements, Commonwealth Health Insurance Connector, and individual coverage. The Act has provisions on 1. Individual mandate 2. Employer requirement 3. Mass health expansion 4. Commonwealth health insurance program 1.2.1 Individual Mandate Under the provisions of the Act from 2007 all state residents should purchase health insurance coverage. This is mandatory unless one cannot afford it. Failure to comply is an offence whose penalty is of up to $ 912. However note children should not be subject to this mandate. The new requirement is implemented via the state income tax system. Additionally the new law it is applicable against adults with incomes below 150% of the federal poverty level 1.2.2Employer Requirements Another provision of the Act is that as from 1st 2007 employers having 11 or more employees are mandated to make what is described as reasonable and fair contribution toward health insurance coverage for their employees. Alternatively, employees can pay or a Fair Share assessment of up to $ 295 each year for every employee. The Act also requires that Employers should offer both full and part-time employees a pre-tax, payroll deduction plan. This is in Section 125. 1.2.3 Mass Health Expansion (Medicaid) The new law has also expanded Medicaid. The law provides Medicaid program to cover children with family incomes up to 300% of Federal Poverty Level ($ 32,508 for an individual). This is for the whole state. 1.2.4 Commonwealth Care Health Insurance Program A fundamental reform the new law has brought is the creation of Commonwealth Care. This is a subsidized program for adults who are not in a position to get employer-sponsored insurance and who do not qualify for Medicaid, Medicare. It also includes other special insurance programs for individuals who earn up to 300% of Federal Poverty Level. In this regards plans are for adults with no monthly premiums earning 150% or less of FPL ($ 16,620 for an individual). Additionally, plans are presently there for $ 39 a month for a person earning between $ 16,621 and $ 21,672; $ 77 for an individual earning between $ 21,673 and $ 27,096; and $ 116 if earning between $ 27,097 and $ 32,508. Under the Act no monthly premiums for the children of adults covered by Commonwealth Care this is because the children are covered by Mass Health that is Medicaid. 1.3 Why the Act was adopted The adoption of the Act came at a time when reforms in the health sector in Massachusetts were wanting. The state sought to extend health to its residents (Marcia Angell, 2008). The Act was adopted because its broader health care reform creates unsubsidized and affordable health insurance products for individuals in the state. These individuals overtime have found small-group health insurance difficult to afford or are financially retarded hence not able to get these services. Additionally, take note that through this marketplace in health will become affordable to by enabling individuals and small businesses to compare plan premiums and benefits and chose a plan that best satisfies one’s own or his employees’ needs. Another reason for adopting this legislation is that it increases transparency around health care quality and costs, reforms insurance market, makes it mandatory for individual to take health insurance requirement and agitates for employer participation responsibilities. The federal-state partnership for subsidized coverage is achieved by the Demonstration and the other private market concept in the health care reform in Massachusetts has been model for states around the US. When it comes to Mass Health the Act provided for expanded coverage to low-income children, families and individuals in Massachusetts. This is because Massachusetts has one of the lowest rates of un insured persons in the US. Therefore there was a need take advantage of a chance to cover this group of people in Massachusetts. The legislation on Health provided a pillar for doing so and for enforcing long-term and fundamental reform to Massachusetts’ health care system. 1.4 How has the legislation worked? The new legislation has brought changes to the residents of the Massachusetts state. This is a fact which can be supported by data on the ground. Firstly since enactment of the law the number of uninsured Massachusetts residents had risen from about 5.4%-5.7% to 6% in 2007. Moreover, it was observed in June 2009 to 3% and back to 4% by December 2009 depending on the methodology one uses. This report was prepared by the Massachusetts Department of Healthcare Finance and Policy. Additionally about 3% of taxpayers were observed by the Commonwealth to have accessed affordable insurance however paid an income tax penalty. Statistically about 2% of those qualified were discovered not to have had access to affordable insurance, and a small number chose a religious exemption to the mandate provision. Now when the first half of 2007 is compared to the first half of 2009 one will realize that spending from the Health Safety Net Fund dropped. This is due to the fact that more people became insured. The Fund that replaced the Uncompensated Care Pool then found work by paying for medically necessary health care of people who cannot access health insurance and those who are underinsured. As observed through the implementation of this legislation there has been reduced expenditure by the Massachusetts state. This reduced state payments expected that through reduction of the number of uninsured people Commonwealth Care would decrease the amount of charity care issued by hospitals In general the enrollment in the Commonwealth Choice Plans that is offered through the Commonwealth Health Insurance Connector keeps on changing between15, 000 to 20000 according to the state. According to the report by DHCFP about 89,000 people bought healthcare insurance directly starting on June 2009 from 40,000 in June 2006. The number of people with group insurance in Massachusetts has held steady at around 4,400,000 since passage of the health care reform law, according to the DHCFP's quarterly Key Indicators reports available on its website. More so, the spending by Private health care on each member in the state increased at a yearly rate of 7.5% from 2006 to 2008. The largest contributor to the growth was the pricing system. But individually purchased insurance grew more at lower rate. It should be noted that to this end in the week of April 5, 2010, the Boston Globe stated that more than a thousand people in Massachusetts keen on the mandate/penalty provision of the law. This was because they chose to be insured only a few months a year and that is when in need of a specific medical procedure. On the average the Globe reported these enrollees were paying $1200–$1600 in premiums over a few months and getting $10,000 in healthcare services before dropping coverage. Another study by the Urban Institute which was released by the Massachusetts Division of Health Care Finance and Policy showed that as of June 2010, about 98.1 percent of state residents had coverage. These need to be compared to 97.3 percent having coverage in the state in 2009 and 83.3 percent having coverage in the country. It should be noted that among children and adults the 2010 coverage rate was even higher. Thus it can be confidentially be confirmed that the Massachusetts' achievements in health care reform have been nothing short of extraordinary. This is because employers, government and individuals all share the responsibility of reform there is continuous increase in insurance rate in the country. 1.5 What lessons can federal Governments learn from Massachusetts? An analysis by Marcia Angell (2008) was of the view that Massachusetts makes fundamental mistake of confusing healthcare and insurance and that Americans know that the two are not the same. This criticism although constructive lacks substance. The reason I am saying this is that there are many positive side of the legislation on health reforms that other states can borrow. I don’t think that agree that Massachusset is pretending by thinking that having insurance is the same as having healthcare. That is why there are lessons other federal governments should learn from this state. It is the role of the respect states to ensure that its residents get appropriate medical cover. They can do these by introducing making medical cover mandatory to all residents. The following are some of the lesson to be learnt from Massachusetts; 1. That it is important for states to appreciate and realize that strong, centralized and well coordinated government agencies assist to overcome the fragmentation often inherent in the health care sys­tem and in government functions hence there is need for cooperation and proper plans 2. Dedicated stakeholder engagement in health reform facilitates enforcement and aids in overcoming inevitable obstacles in the road towards bettering its residents’ life. 3. When there is a close coordination between Medicaid and new public insurance there is a need for pro­grams to optimize enrollment and retention while also decreasing redundancy and costs related to administration. 4. There is need for other federal governments to develop and support a large array of community based outreach, enrollment, and retention activities which enable those uninsured residents to sign up for, take and maintain healthcare coverage. 5. Another lesson is that for any successful implementation there is a need for high levels of awareness and comprehension among individuals and businesses about their opportuni­ties and responsibilities under health reform. 6. It is fundamental for these federal states to know that no matter how successful health reform proves to be, there will still be uninsured and underinsured people who require access to medical care. 7. That the notion of Health reform enforcement is an ongoing process that needs continuous improvement based on feedback from em­ployers, consumers, providers, and other stakeholders in the state. 8. That moderating future growth in health care spending is more difficult than gaining nearly universal coverage, however, without cost check up, coverage expansions are unsustainable. 1.6 Conclusion The reforms brought by the health care Act in the state of the Massachusetts are worth credit and that other states need to embrace such reforms. The health sector in Massachusetts has received a major boost through enactment of this Act that intended to Providing Access to Quality, Affordable, Accountable Health Care was passed. The target is given and ensures access to affordable health insurance coverage to all residents of Massachusetts. In conclusion the goal of the Act is modernizing health insurance laws and by this it removes all setbacks in purchasing health insurance. Another aim of the legislation is to redirect current government assistance for uncompensated care to health insurance premium subsidies that is from institutions to individual. It is also aimed at ensuring individual responsibility. The Act also provides for employer responsibility and other provisions as shall be outlined. References Turner, M. G. Costs Keep Rising, the Wall Street Journal, October 27, 2009, R8 Marcia, A. “Health Reform you should not believe In”, the American Prospect, May 2008, A15-18 Scott, H. Lobbyists Took in $7.5m on Health Bill, the Boston Globe, April 5, 2006, A1 Robert, S. Health Care Reform in Massachusetts, a Work in Progress, The New England Journal of Medicine, May 18, 2006, 2095-2098 Stan, D. The Secrets of Massachusetts’ Success, Wood Johnson Foundation, November 11, 2009 Evaluation of the Mass Health Enrollment and Outreach Grant Program, Center for Health Policy and Research (CHPR), UMass Medical School, February 2010 Controlling Health Care Spending in Massachusetts, Massachusetts Division of Health Care Finance and Policy, August 2009 Patrick-Murray Administration Proposes Comprehensive Health Care Cost-Containment Legislation, Press Release, Office of the Governor, February 17, 2011 Examination of Health Care Cost, Trends & Cost Drivers, Office of the Attorney General, March 16, 2010 Lobbyists took in 7.5m on Health Bill, Industry Boost spending by Third: retrieved from, http://ezproxy.lib.umb.edu/login?url=http://proquest.umi.com.ezproxy.lib.umb.edu/pqdweb?did=1015876421&sid=2&Fmt=3&clientId=46815&RQT=309&VName=PQD “Health care reform in Massachusetts- A work in Progress, retrieve from, http://ezproxy.lib.umb.edu/login?url=http://proquest.umi.com.ezproxy.lib.umb.edu/pqdweb?did=1040984381&sid=6&Fmt=4&clientId=46815&RQT=309&VName=PQD Read More