Massachusetts is tinkering with universal health insurance. By Dec. 31, nearly everyone in the state will be required to have an insurance card.
The Massachusetts plan is a political experiment, a policy experiment, and a social experiment. It imposes a system of shared responsibility, with new burdens on individuals, on employers, and on the government. The state taxpayer association calls it "a truly noble experiment."
In broad strokes, it works like this:
Nearly everyone has to have insurance, or else face a penalty at tax time. Businesses with 11 or more employees have to pay a "fair share" of the cost, or they face a penalty, too.
The state has signed up more than 150,000 poor people for free or subsidized health insurance, negotiated lower-cost plans for everyone else, helped the self-employed and employees of small businesses qualify for group coverage, and required that, starting in 2009, everyone have prescription drug coverage and low deductibles so their health insurance actually helps when they get sick.
We visited two restaurants to meet the owners, cooks and waitresses, who are struggling to adapt to the Massachusetts Health Reform Law.
The Massachusetts plan is a policy experiment, too. Will the state be able to enroll enough young, healthy people — the kind who pay premiums but don't get sick very often — to reach the goal of universal, or near-universal, coverage without needing a tax increase to pay for it? And even if everyone signs up, can the system be sustained if it doesn't address the rising cost of health care?
Since the law took effect on July 1, about 170,000 of the uninsured have signed up — but most of them are the poor. Just 17,500 or so have signed up for the unsubsidized health insurance plans through July, but those plans just became available May 1. That leaves the tougher nut: about 200,000 to 300,000 people who earn enough money so they aren't eligible for subsidized care. They may not see the need to spend part of their disposable income on health insurance.
The state has already backed off of "universal." About 160,000 uninsured people in the state have incomes that are too high to qualify for subsidized health insurance — but too low to afford the lowest-cost unsubsidized plans. About 60,000 of these working poor won't face a penalty for not getting insurance, but the 100,000 others are in a bind.
One premise of the state plan is the state's costs for health care will fall if people get preventive care.
Persuading the young and healthy to join the health plan is key to its success. That's why the state is spending $1.3 million to advertise on Red Sox cable broadcasts. "Their audience is ours," said the spokesman for the state program, Richard R. Powers. "Most of the people in the state who haven't gotten insurance are young, and most of those are men."
So far, only a few thousand people a month have signed up, but the deadline is still four months away, and even then the penalty for noncompliance is weak. Those who can't show proof of insurance by the end of 2007 lose their state tax exemption when they file their income taxes in 2008, or about $219.
The penalty increases in January 2008. For every month in 2008 that they don't have insurance, residents will have to pay a penalty of up to half the cost of the lowest-cost plan. That could be as much as $150 a month, or $1,800 a year, due at tax time in 2009.
The definition of personal responsibility may be expanding. As the Boston Globe's liberal editorial page said of the penalties, "That's tough, but it's necessary to change the behavior of people who are used to going without insurance, either because they are healthy or are accustomed to relying on the Uncompensated Care Pool to pay for their care."