When the Obama administration and the Congress take up health reform in 2009, one of the most contentious issues is likely to be whether to include an individual mandate (IM) in any proposal to expand coverage. When Chapter 58 passed, I was not a fan of the IM. But I’ve since had something of a conversion. While I don’t yet fully embrace the IM, I do think it’s played a much more important role than I expected in the coverage expansions in Massachusetts. And the experience here with designing and implementing the IM holds important policy and political lessons that should inform the debate on whether or not to include an IM in national reform.
Back in 2006, I knew the policy arguments for the inclusion of the IM in our reform law. In particular, the Urban Institute had shown in its Roadmap to Coverage project for the Blue Cross Blue Shield of Massachusetts Foundation that a voluntary insurance system would not get us close to universal coverage, even with a much stronger employer pay or play requirement than was ultimately included in Chapter 58. Without an IM, many people would not take up employer coverage that was available to them and others would not purchase individual coverage even if it were affordable, particularly younger people. In addition, the IM would play a role in helping to make coverage more broadly affordable, since in a voluntary health insurance system people with lower than average medical expenses (e.g., young people) are less likely to purchase coverage. It was also important to cover as many of the uninsured as possible to reduce spending on uncompensated care, since reallocation of money from the Uncompensated Care Pool was a major source of financing for the new Commonwealth Care program.
I also understood the political role of the IM as an important leg of the “shared responsibility” stool. The federal government would like it, as an innovative “market oriented” approach to expanding coverage, which would help gain approval of the federal waiver and the continuation of federal financing required for coverage expansions. So I realized that the IM seemed to be a necessary compromise to get the MassHealth restorations and expansions and the Commonwealth Care program.
Still, I couldn’t shake my long-standing belief that the IM was, at its core, a policy created and pushed by conservative think tanks. The rhetoric about creating a “culture of insurance” in Massachusetts made me very uneasy. I thought the most important policy and political task ahead was to make sure that it was implemented in a “first do no harm” manner in order to blunt its potential negative effects.
Well, two-and-a-half years later, it’s hard not to argue that the IM has turned out to be a very important component of the coverage expansions in Massachusetts. In particular, it is likely the most important reason why more than a third of the newly insured—159,000 of 439,000 newly insured people–are in employer-sponsored plans. Instead of the feared “crowd-out”—the replacement of private coverage with public coverage—we seem to have had crowd-in (to use the words of MIT economist and Connector board member Jon Gruber). And the IM probably explains why a larger percent of Massachusetts employers are offering health insurance now than in 2006—79% according to the latest survey. These increases in Massachusetts are occurring at the same time that employer coverage is eroding nationally. And the IM has no doubt helped contribute to the rapid growth of Commonwealth Care, particularly among income groups that are required to pay a premium for CommCare coverage. It’s difficult to explain why coverage trends in Massachusetts—particularly in employer-sponsored coverage– are so different from those in the rest of the country without giving due credit to the IM.
Many national health policy experts—including those who advised President-elect Obama– have dismissed the importance of the IM. But I for one have been forced to concede that the IM does matter. It has been a more important part of expanding coverage in Massachusetts than I—and I think many others–expected. So, what lessons can the country learn about the IM from our experience here? I can think of many, but here are four big ones:
First, any IM must be coupled with major initiatives to make insurance more available and affordable, particularly for people with low and moderate income people. The expansions of MassHealth and the creation of Commonwealth Care have been essential to coverage gains here (more than half of the newly insured have obtained coverage through these public programs). We can’t obligate people to buy health insurance unless we make coverage more broadly available and affordable, and we will never reduce the number of people without insurance in any significant way without a major expansion of public programs (and federal funding to help pay for them).
Second, the country will need to make major reforms to the regulation of the private health insurance market—particularly the individual and small group segments– if the IM is to achieve its goal of making coverage more broadly affordable by pulling more young people into insurance pools. Massachusetts has long had among the most stringent regulation of these markets, with guaranteed issue and renewability, modified community rating, and requirements that ensure larger more stable rating pools. Thousands of young people have bought coverage through the Connector and directly from insurers and our regulatory structure for the individual and small group market ensures that everyone in these markets benefits when lower risk people participate in the system. This is not the case in most other states, which still permit rating and underwriting practices that were abolished in Massachusetts nearly 20 years ago. To most people, insurance regulation is boring and arcane (hard to believe, eh?) but it’s a critical issue in national reform.
We will be able to inform the national conversation in this area even better when we find out more about the nearly 100,000 people who reported on their 2007 tax filings that they had access to affordable coverage but paid a tax penalty instead of buying it. I suspect a disproportionate number of these people were younger. The larger penalties this year might change the purchasing behavior of these folks, but since the penalties will still be much less expensive than buying coverage, it might not. If it doesn’t that will be another important insight about how difficult it is to get younger people to buy health insurance, even with an IM.
This brings me to my third lesson: Congress will need to design and implement any IM with great care and caution in order to sustain public support. This includes developing a transparent and publicly accountable process for setting benefit and affordability standards, reasonable penalties, and generous waiver policies, as the Legislature designed and the state has implemented here. I got an earful last week from some very well known national health policy figures who opined that the IM penalties here are too low and that the IM itself isn’t being enforced aggressively enough. They were particularly concerned about the lack of any penalties for people who don’t file state income taxes, and they had lots of ideas about how to reach this group (including not renewing driver’s licenses without a valid health insurance card and not allowing people to enroll their kids in school if the adults can’t prove they are insured). If these types of highly punitive enforcement measures were ever to become part of an IM, we would rightly have a swift and successful public movement to repeal the mandate
Finally, the expansions of employer coverage we’ve seen in Massachusetts are unlikely to happen on the national level unless a national coverage plan includes much greater obligations on employers to provide, or finance, coverage. A much greater proportion of employers in Massachusetts offer health coverage to their workers than in the rest of the country, and this base of employer coverage has interacted with the IM to expand the number of people with employer-sponsored insurance. If we want to see similar gains from an IM on the national level, we need to find ways to expand employer coverage. A fair share assessment of $295 per worker per year certainly won’t be enough—we’ll need a much more significant employer pay or play provision or, better yet, a national requirement that employers provide health insurance.
So, I’m still on a journey with the individual mandate. I’m not a true believer but I do think a national IM might be a purgatory on the way to something better (which for me would be a uniform national health insurance system, financed by a broad-based progressive tax). Purgatory isn’t heaven, but at least it’s temporary and it beats the alternative.
Nancy Turnbull
Harvard School of Public Health
Ms Turnbull,
The individual mandate is fascism and it punishes an already beleagured middle class. I’ll be there to fight you tooth and nail when it comes to any attempt to take the concept national! President elect Obama would do well to remember that the mandate was one of the things that separated him from Senator Clinton and ultimately made him the more palatable nominee.
Mr Norton:
Thanks for your comment. The beauty of democracy as opposed to fascism is that you can express your passionionate views about this topic in DC, and I am sure many others will join you. As I’ve watched the experience in Massachusetts, I’ve seen that the mandate, while far from perfect, does have some strengths in terms of getting more people covered and getting the health insurance system to work better. But it has many risks as well, particularly political risks since it’s analagous to a tax. It’s also a very inefficient approach to expanding coverage–what Columbia School of Public Health professor Sherry Glied termed “Universal Coverage One Health at A Time,” in an article in the New England Journal of Medicine. National politicans may well be unwilling to support an IM, as President-elect Obama did not. While I understand that decision, I do think we should be honest that it will limit the extent to which any likely reform plan will reduce the number of people without health insurance.
I am curious if you feel equally strongly about other types of mandates: buying car insurance, wearing a seatbelt?
Nancy
Ms. Turnbull,
Feel free to call me Ron. What is happening in Massachusetts is not democracy. I don’t recall having an opportunity to vote on the merits of Chapter 58, it was foisted upon us by arrogant politicians and ivory tower academics who do not reside in the same world as the masses. This approach to healthcare reform is analogous to bailing out GM by forcing us all to buy Escalades, with one group of citizens subsidizing the purchase for another. The architects of this plan have mandated us into a wasteful and inefficient system that perpetually costs more and produces little value for the dollars spent.
To answer your question regarding mandates, yes I am genrally opposed to the government trying to protect us from ourselves. However, your examples are hardly analogous. Mandatory auto insurance indemnifies drivers against losses caused by other drivers or unforseen events. It protects us from one another. While it is hardly a bargain, it is far less costly than health issurance. As far as seat belts go, I’ve been a licensed healthcare provider and health educator for the past thirty years, I’ve seen the results of motor vehicle accidents and the injuries trauma produces. I never get into a vehicle without fastening my seat belt, I also strongly believe that children should be required to wear restraints, but if an adult is foolish enough to want to risk vaulting himself through a windshield, I say let him.
Hi Ron,
Well, the law was enacted by legislators who are elected officials. You and others can work to vote them out of office if you don’t think they represent you well, but our governmental system doesn’t let us each vote on an individual basis for one issue at a time (except through the ballot initiative process).
Best regards, Nancy
I think my analogy to auto insurance is quite apt. Both auto and health insurance are desinged to protect us from the financial consequences of expensive events that are largely unforeseeable. While some medical problems are predictable, others are not, particularly serious problems that result in expenses that most of us could not finance ourselves.
I disagree with you about the purposes of the 4 mandatory coverages we have to buy if we drive a car in Massachusetts. One of the purposes of the mandatory coverages is to protect us from ourselves, and shield the policyholder from finacial consequences of accidents. Bodily injury protection is designed to protect the policyholder from legal liability and the financial consequences if he or she injures or kills another person while driving. Personal Injury Protection pays for medical expenses and lost wages of the policyholder, passengers, pedestrians or anyone else who is injured in an accident. The third protects the policyholder and anyone driving his/her car from bodily injury caused by an uninsured or hit and run driver. And the fourth coverage pays for damage the poliyholder causes to someone else’s property when he/she cause an accident.
Seatbelts are an important public health intervention that reduce deaths and injuries. They also help reduce the medical expenses that result from such accidents. If people who don’t wear their seatbelts are uninsured, everyone with insurance help to finance the care that they get through cost-shifting to us. So the cost of not wearing a seatbelt goes far beyond the individual. This is why many societies mandate that adults wear seatbelts—to improve health and reduce the costs to all the rest of us.
Nancy
Nancy,
Trust me I will be working hard to oust all of the legislators who voted for Chapter 58, although unseating incumbents in this state is next to impossible. I did vote against Bob Spellane on November 4th and withheld my vote from Harriette Chandler. I will also lobby my union to withhold endorsements from certain politicians, Governor Patrick, in particular.
One of the reasons that your auto insurance analogy is weak, in my opinion, is that people can choose to drive or not. However, mandatory health insurance represents a tax on our mere existence. Furthermore, under the existing scheme it has no hope of improving access to services or the quality of care, and we have already seen that it does not lower or even slow the growth of costs. In fact, it has already necessitated new taxes. Even Mr. Kingsdale admits that the situation is unsustainable in the long term.
Overall, I’m thankful for your original post, since it illuminates the caliber of the enemies we are dealing with here. I assume that the Connector’s pet economist and resident sadist, Herr Gruber, is one of those calling for harsher penalties. Suspend people’s driver’s licenses and then can’t go to work. This shifts productive members of society onto to the welfare rolls, but of course, they will then qualify for MassHealth coverage. Try to keep our children out of school because they are uninsured and we will haul the state before the U.S. Supreme Court so fast that Jamie Katz’s head will spin. Frankly, if you attempted to pull any of these stunts in a European or Asian country, the populace would be constructing guillotines and mapping the most expedient route to the Connector offices. Citizens of a democracy ought not to fear the government; government should fear the people. Unfortunately, Americans have gotten used to mediocre and unresponsive leaders; we have come to expect no better.
By the way, when I was one of the “young invincibles” I always carried medical coverage through my employers. My current employer, the Commonwealth of Massachusetts doesn’t feel that I am worthy of coverage via employment. I think the hypocrisy is nauseatingly evident. I can’t leave the state right now, but as soon as I am able, I hope to flee this frozen pothole and never look back. That is why we must keep the cancer that is Chapter 58 from metastasizing elsewhere. I actually agree with you that a single payer system financed through an equitable tax is the fix we need. However, with legislation like Chapter 58 serving to obstruct the way, we can’t get there from here.
Ron,
I am offended by the personal attack on Jon Gruber in your latest response. You might not agree with Jon’s policy positions–as I sometimes don’t. But he has been an incredibly hard working, thoughtful and valuable member of the Connector board. In my experience, Jon is the absolutely best kind of academic: very well versed in the issues, independent, open to new ideas, information and arguments, and able to be pragmatic. I am delighed to serve on the Connector board with him. To call him a “sadist” and “Herr Gruber” is deeply insulting–both to him and his service, and to everyone who has been doing their best to help implement the reform law in a careful and thoughtful fashion. I am happy to discuss and argue about the policy and the politics of the law but not while you’re launching personal attacks.
Nancy
PS Jon wasn’t one of the national policy people with whom I had the conversation about the IM. In addition to stopping the personal attacks, you might be cautious about jumping to conclusions.
Nancy,
My goodness, I had no idea that you were so thin skinned. Sorry if I offended your delicate sensibilities, but I offer no apologies to Dr. Gruber. First of all, Herr is simply a German salutation. Gruber is a Germanic name, is it not? This is no more derogatory than referring to Antonio Banderas as “Senor Banderas”. Any inference on your part is yours alone. Secondly, Gruber refers to those of us who lack insurance as “free riders”, well I have never cost the system a damn dime, and I find the term incredibly insulting! Furthermore, after arrogantly declaring that he had proven that “everyone could afford insurance” he then declared that it was “…time to get mean…”. So I’m not jumping to any conclusions. Dr, Gruber may be a very competent economist, but he comes across an abominable human being. I can’t help but think of a man who has publicly declared his intention to do me harm as anything other than my enemy. You yourself have often referred to the MA plan as a “bold experiment”, I guess that makes us all lab rats. I am a healthcare provider who has no access to health services, I haven’t seen a physician in ten years. Last year I was fined $220 for refusing to buy a worthless product that you and Dr. Gruber say I must have. This year I will be fined nearly $1,000. It is hard not to take that personally. Of course I’m sure you simply consider people like me “colateral damage”. This is not some esoteric policy discussion to me Dean Turnbull, this is my life you people are playing with! So frankly, if you can’t stand dissenting voices, get out of the game. I didn’t start this war, but I have no problem fighting it, and I will not promise to fight fair. If you don’t care to continue the discourse with me, fair enough, but I won’t back down.
I have just taken a deep breath after reading these comments and must say that I agree wholeheartedly with Ron. Since I believe he is referencing the Connector plans a/k/a Commonwealth Choice in part of his discussion, let me tell you, Ms. Turnbull, how it’s going regarding the Commonwealth Care plans in case you haven’t noticed.
First of all, these plans (for residents 300% and below FPL) are not affordable which is very clear when you look at the disparity in the enrollment figures for Plan 3 vs Plan 2b and on down the line, and enrollment in these plans has been more or less flat since January 1, 2008.
These premiums were not affordable in 2007 when the requirement to carry health insurance kicked in, and copays were too expensive for many lower-income residents to attain care. In early 2008, a statewide survey was conducted by 48 outreach agencies, and the testimonies of residents and health caregivers/outreach agents was presented to the Connector, yet, premiums increased by 10 percent, and nearly all the copays went up by 50 to 100 percent for this class of people on July 1, 2008. Another increase of the same magnitude is on the table for 2009 at a time when people can’t even afford heat, food, property taxes or mortgages.
You refer to this as cost-sharing when, in fact, it is cost-shifting – right onto the backs of those who can’t afford it. Your friends at the Connector tried to explain this away by saying they didn’t want the subsidized plans to be more attractive and take business away from their buddies in the insurance companies. I have news for you: we don’t take stupid pills. We get it.
MA state senators and reps were also privy to this survey as well as many other adverse affects of this law but continued (and still do) to march in lockstep with leadership – support MA “Health Care Reform” no matter what is happening to your constituents – all eyes are on MA.
Raising premiums that were already too expensive makes it all the more difficult to comply with this law, and residents are forced to make choices between heating and eating or paying for health insurance or penalties. Increasing copays makes the insurance unaffordable to use, thereby discouraging care, access to RX and tests, etc. Several weeks ago, there was an AP article about MA residents struggling to pay insurance costs. Maybe you missed it.
But, increasing copays saves the state money as it tries to prop up this unsustainable non-system – I say non-system because there are so many grave problems with this model that a comment on a blog cannot cover. In fact, on November 27, an article on increasing Medicaid costs ran in the NY Times. I gagged when I read this – all about reducing costs for the country and/or the states by increasing copays while it blames sick, low-income people for misusing access to care and necessary RX. In other words, raise the copays for this class of people; makes no nevermind if they can’t afford their meds or care. MA beat the Feds to the punch on this one re Commonwealth Care increases as mentioned above. Maybe Mr. Gruber was working with the Feds on this since he obviously has no clue or doesn’t care how low-to-moderate income people struggle to make ends meet.
This morning during a call to a health care center near me, the woman with whom I was speaking mentioned that their staff was talking together last week about the large number of people coming there who can’t pay the copays which is, obviously, a problem for the center. These are people with Commonwealth Care as well as people who were afraid of losing their jobs so signed up for the ESI although they couldn’t afford it, and, obviously, can’t afford to use it, and, of course, those who have remained uninsured b/c of affordability issues and/or estate recovery (btw, the recent additional text re the estate recovery clause on the MBR doesn’t cut it – no way, no how).
Of course, you must be aware of the fact that Commonwealth Care members can’t find doctors b/c the state doesn’t reimburse at a high enough rate for these docs to hire more staff and/or pay their overhead. So Commonwealth Care members have to use the ER while Judyann Bigby and others blame the patients by saying they need to be educated now that they have insurance – they just don’t know they must have a PCP – a medical home. Well, breaking news: If you have been forced to purchase health insurance but can’t find a doctor who will take you, then where do you go? The ER! (NOTE: There are some clinics with volunteer doctors and nurses who are taking Commonwealth Care patients at NO COST to the taxpayers b/c these clinics are privately funded – but there aren’t many places like this, and they can’t be counted upon to do this.)
I recently asked someone from HCFA who stated publicly that the MA health insurance plan was a great success if she considers those who are being adversely affected (and there are many) to be collateral damage. She hesitated, then replied: Those who have fallen through the cracks of health care reform are “unfinished business.
I have news for you and your crowd. I haven’t fallen through any cracks, nor has my sister, my friends, Ron or any of the hundreds of thousands who remain uninsured in MA. We are NOT unfinished business. We are NOT collateral damage. We are people with names and faces, families and lives, and you are playing with our lives by trying to intimidate us, by stealing our hard-earned money in the form of an TAX penalty for being uninsured – money we desperately need to pay our bills – and causing us stress which is the worst thing for our health. Don’t ever mention again FIRST, DO NO HARM in the same breath as saying you support and consider this heinous model of so-called health care reform to be a good thing. And remember, the next time you gloss over the grave problems that people are experiencing in MA under this law: we did not give you et al permission to experiment with our lives.
Ron Pollack, President of Familes USA, spoke and took questions/comments on Washington Journal several weeks ago at which time he stated that MA residents are happy with what the state has done. Someone needs to inform this fellow that in the recent election that brought out the highest voter turnout in Massachusetts probably since 1928, a local ballot initiative supporting single payer and opposing individual mandates passed by landslide margins in all ten legislative districts where it appeared. It read as follows: “Should the representative from this district be instructed to support legislation creating a cost-effective single payer health insurance system that is available to all residents, and oppose laws penalizing those who fail to obtain health insurance?” So much for the popularity of the MA plan among Bay Staters.
The MA plan is a bandaid that is a waste of precious state money while it harms many, has not decreased premium costs for those who were already insured, and, furthermore, does not provide access to affordable, quality, EQUITABLE health CARE for all. Furthermore, although some residents currently benefit from the MA plan, a system that helps some by exploiting others is unjust and cannot be considered a success.
The following is an excerpt from a letter, Working on the Waiver by Senator Edward Kennedy, March 7, 2008, that was posted on this blog: “The Governor [Patrick] is making a strong case for continued strong federal support for health reform, and I will be working right alongside him to make sure Massachusetts gets a fair deal.”
Perhaps, Ms. Turnbull, you will post a response to the following since you have shown yourself to be a key player and supporter of the MA plan:
What people or parties in Massachusetts are getting a fair deal under the current and future implementation of this mandated health insurance law, and how do you determine what is a fair deal and what is not?
Karen Ignani, the mouth piece for the insurance industry, as well as MA politicans and powerbrokers and some in the U.S. branch as well, have become quite accomplished at using single-payer terminology for self-serving reasons, e.g. they can sure smell a money-maker a comin’ down the pike. In fact, that was the point of the Massachusetts “experiment.” Run it in MA, call it Universal Health Care, trumpet it as a success and bingo – it’s a model for the nation!
Shame on the majority of our politicians and health policy experts. If they truly wanted all Americans to have equitable, quality, affordable, comprehensive health care with the goal of accomplishing this in a fiscally responsible manner, they would be looking into the expansion of Medicare for all – HR676. Medicare is in place, and it works. Try to take Medicare away from a senior, and you’ll end up with a black eye.
We don’t need or want this bureaucratic non-system that is MA “health care reform” plan which is akin to rearranging the deck chairs on the Titanic and, at the same time, harming people until she sinks. Shame on Massachusetts!
After reading your article and some of the other comments, I wanted to add my two cents. I think that the individual mandate system is a good idea mainly because it has increased the number of young people who are insured. Between student loans, the increasing cost of living and the economic slump, finding affordable health insurance (especially when you are doing it for the first time) can easily get put on the back burner. Like car insurance, health insurance is a preventative measure so that if something horrible happens, you are not completely overwhelmed by the mechanic or hospital bills. Also, remaining uninsured and forgoing annual medical care can cause relatively minor acute health problems to turn into costly chronic conditions. Helping people gain access to regular health care before conditions become chronic could help decrease the overall costs of the health care system in the long run. Also, increasing the number of healthy members in an insurance program increases the amount of money that can be spent on the sick.
Let’s be clear, the individual mandate is nothing more than a sop to the medical industrial complex. It does almost nothing to actually reduce costs. The lack of participation of the ‘uninsured’ is a minor factor in overall rising rates and poor medical outcomes.
I’m sorry Nancy, but we need much more radical change, not this piecemeal approach. If we don’t throw out the medical insurance system wholesale and then change from a fee for service to a salaried model, then we are going to suffer a catastrophic melt down of the entire medical care delivery system (it has already started). What has kept it going as long as it has are a set of myths and fears held by the public, to the pleasure of those financially raping us and running off with the obscene profits. The Massachusetts law is a sham enacted by a legislature that does not represent the people but has been lobbied by a medical care industry with a bigger budget than the entire commonwealth! Money has talked and we who are paying are left with no options. It is fascism plain and simple. I can only hope that those who have perpetrated this injustice suffer equal injustices when the system collapses. No other developed country on earth allows direct promotion of subscription drugs to the public. This is only one example of the sheer power of this system to do damage to public health and finances.
I agree with Glenn….A big problem with this Massachusetts mandatory healthcare that it charges more to older people. It wouldn’t be bad …..say if I were 20 years younger. The older you are the more expensive the plans. When you are over 50 (even 40) it is difficult since we are too young for medicare. Why is it that older people have to pay more? You know there ARE healthy older americans out there. We’re not already to die yet…..This whole thing is ridiculous! I have recently applied to commonwealth care and haven’t heard a thing yet. My COBRA from my last job is almost up…..I haven’t been able find a job yet!