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 -~ % 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)