Massachusetts Health Care Reform

1. Massachusetts Health Care Reform November 20, 2006 Briefing STATE HEALTH REFORM INITIATIVES: Are There Lessons for Federal Policymakers? Sponsored by The Alliance for Health Reform and The Commonwealth Fund Presentation of Amy Lischko, Director Massachusetts Executive Office of Health and Human Services

2. Agenda • Overview of Massachusetts Healthcare Reform • Implementation Update

3. Massachusetts healthcare problem: • Growing number of uninsured – 460,000 in 2004 −Expensive emergency room care −Poor preventative, primary care • Double-digit insurance premium rate hikes • Businesses dropping benefits nationally • Hard for individuals and small businesses to buy insurance • Free-riders • $1.3 billion cost of free care - growing bigger every year

4. The Uninsured in Massachusetts • Total Commonwealth Population: 6,400,000 • Currently insured (93%) 5,940,000 Employer, individual, Medicare or Medicaid • Currently uninsured (7%) 460,000* <100% FPL Medicaid eligible but unenrolled 106,000 -~100-300% FPL Low Income 150,000 ->300 FPL Middle Income 204,000 Note: Based on August 2004 Division of Health Care Finance and Policy statewide survey * August 2006 Division of Health Care Finance and Policy stateside survey shows 372,000 uninsured residents

5. Organizing principles for a “fully insured” population Stabilize the small group insurance market and keep small businesses from dropping insurance Introduce lower-priced, comprehensive health insurance products Bring younger, healthier people into the risk pool Create a Connector to permit pre-tax premium payments Facilitate the purchase of insurance by part-time employees and employees with multiple employers Promote a culture of insurance and personal responsibility Control costs for system sustainability

6. Responsibility for key elements of the law

7. Benefits of the law

8. Agenda • Overview of Massachusetts Healthcare Reform • Implementation Update

9. Progress to date Connector up and running Commonwealth care benefit packages and subsidies determined Commonwealth Care enrollment began Oct 1, 2006 Medicaid expansions implemented Fair Share regulation completed Free Rider regulation completed Education of employers has begun

10. What’s left to do? Determination of what constitutes creditable coverage Specifications for affordable insurance benefit packages Determination of how affordability for people over 300% FPL will be handled Determine eligibility and services for Safety Net Care Merger of nongroup and small group markets Reporting requirements for employers (HIRD) Rules for Section 125 Plans Anti-discrimination rules and guidance  Education, marketing and enrollment

11. Good news so far but …… Recent Survey of MA residents found: -80% had heard of the law (about a quarter of them knew a lot) -64% support the law -More support for Medicaid expansion for kids and business requirement to offer or pay penalty than for individual mandate -Support across subgroups of insured and uninsured and socio-economic status -Some skepticism expressed about implementation -Concerns about small businesses -Continued support will depend on affordability of premiums (Results from Survey of MA residents conducted by Robert Blendon for BCBS Foundation)