Back in 2006, Massachusetts took a step into the unknown with a universal healthcare reform. As we come to the end of 2010, it’s instructive to look at how things have changed in this state, and to assess what lesson may be learned by the rest of the US. Let’s start with an simple statement. Before 2006, large numbers of people played Russian Roulette with their health. It was sufficiently expensive to self-insure, particularly when working from home or running a small business, that most decided not to insure. They gambled they would never need medical assistance, often going years without seeing a doctor no matter what happened. Now the state has established an exchange called the Connector Authority, any resident can sign up for one of the seven plans approved by the state and sold at regulated prices. All the interested parties agree the average premium payable for individual health plans has dropped by about 40%. This would be really good news except that these premium rates are dropping from among the highest in the US. In part, the insurers anticipated the politics of being seen to drop their premiums. So, as the law was going through the legislature, the insurers increased their premiums. Even now, Massachusetts has one of the highest premium rates in the country.
Perhaps more importantly, the percentage of residents uninsured has dropped by 60%. Before 2006, about 10% of the population had no cover. Only about 4% has no cover today. As many are unemployed or in low income jobs, the state subsidizes and regulates the premium rates. Employers with more than 10 employees must offer a health plan. Medicaid has been expanded. Of course, this is not without its more controversial side. Holding cover is mandatory. If people prefer not to self-insure, they must pay a penalty. There have been endless cases challenging the law as unconstitutional and resisting the payment of a penalty. So far, the state has been aggressive in defending the law and enforcing it. All scofflaws are pursued and seen to be forced to pay. Without this, the mandatory quality of the law would be lost.
The main failing of the law has been in controlling costs. As a law, almost 75% of the electorate approve, but they also see the pressure to raise premiums because the prices of treatments and medications are rising faster than inflation. So while cheap health insurance is available through the Connector Authority today, all the good work could be wasted unless the law-makers step in to control costs. There’s also a shortage of primary care physicians. As more people have cover, they want to see doctors. Training them takes time and the current availability is poor in the rural areas. This drives people to the emergency rooms where the pressures are severe. In fact traffic has increased to ERs by 20% in the last four years. All this shows the health insurance providers working well with the state government. If costs could be contained, this would be a perfect model for other states.