Rocky Transition from MA Health Care Law to Affordable Care Act

Wednesday, February 12, 2014

Zeke Wright, GoLocalWorcester Contributor

There's been plenty of criticism lodged at the rollout of federal health reform, even in Massachusetts, the state often cited as the model for the Affordable Care Act.

Following Gov. Deval Patrick's new plan to overhaul the state's online Health Connector insurance exchange, the Legislature's Joint Committee on Health Care Financing is taking testimony at a Wednesday morning hearing to ask what went wrong.

“I don't think anybody expected the exchange piece to go so poorly,” said Joshua Archambault, the director of health care policy at Boston's Pioneer Institute.

Connector spokesperson Jason Lefferts told GoLocal the state was working to correct issues with its online exchange. “We still have a lot of work ... but we are doing what we set out to do.”

Actions announced by Patrick last week include an outside review of the website by an independent technology firm and the appointment of a special assistant to the governor to move the project forward.

Through most of the open enrollment period, the majority of applications have been processed on paper or offline.

Should Massachusetts be in a better position?

Should the Bay State have had an easier time, given its own reforms that already mandated insurance coverage and set up an online exchange?

“From an operational perspective, I don't think that's true,” said Amy M. Lischko, an associate professor of public health at Tufts University School of Medicine and former commissioner of health care finance and policy and the director of health care policy under Gov. Mitt Romney.

An author of the state's reform, Lischko said the 2006 law may have eased the transition from a policy adoption standpoint. But functionally, “I feel like the federal law was a lot more complicated.”

States without any previous online system may have been in a better position to create all-new exchanges.

Limited in scope before, Massachusetts' online insurance marketplace had to be completely overhauled to comply with standards in the Affordable Care Act.

Lischko said she was of the opinion the state should have received a waiver from those requirements.

“Our system, it was more basic, but it worked.”

Among lowest numbers of sign-ups on health exchange in nation

With technical problems with the state's exchange, few residents are signing up: Lefferts tallied 8,473 new enrollments this year as of last Friday, inclusive of subsidized and unsubsidized medical insurance and dental plans. (That's added to the 5,428 enrolled through the last three months of 2013.)

Many additional residents are being covered through the connector on a temporary basis, including some 101,000 individuals on state insurance programs that have had their coverage extended through the end of March, and an additional approximate 30,000 who've applied for subsidized care and will be receiving temporary coverage while the system's bugs are worked out. Another 5,000 to 6,000 individuals have had their employers pick up insurance through the exchange during open enrollment.

Ensuring all those individuals stay covered is the main priority according to Lefferts. “Our goal throughout has been to make sure everyone who has coverage keeps that coverage,” he said, “and make sure people who do not have insurance sign up.”

The state's earlier reforms had a measurable impact on uninsured rates: from 10.4 percent of the population in 2006 to 4.4 percent in 2009 according to the U.S. Census Bureau.

And a report late last month from the Federal Reserve Bank of Chicago credits Massachusetts' reforms with reducing the total amount of medical-related debt and personal bankruptcies in the state.

Lefferts tallied expanded offerings, better coverage, and premium subsidies as positives following from the federal health reform. “I think we were in a great position to take advantage of what the Affordable Care Act offers Massachusetts,” he said.

Employer mandate to provide coverage pushed back

A second delay to the federal law's employer mandate was announced this week, allowing further time before medium- and large-sized companies are penalized for not providing health insurance options to workers. That requirement was initially to take effect at the beginning of 2014.

In Monday's ruling, the Obama administration gave companies with between 50 and 99 employees another year (to 2016) before they are required to offer insurance coverage or be penalized.

Employers with 100 workers or more get a partial reprieve, in that they only need to offer coverage to 70 percent of their employees in 2015, increasing to the original 95 percent target in 2016.

Businesses of those sizes employ around 82 million people combined according to 2011 Census figures. But as the Kaiser Family Foundation points out [ http://www.kff.org/report-section/ehbs-2013-section-2/], most of those businesses already offer insurance: including 91 percent of firms with 50 to 199 employees, and 99 percent of larger companies.

So what's the effect of moving those goalposts?

The changing deadlines are still throwing businesses, insurers, and brokers for a loop. “Anecdotally, talking to some business owners and insurance brokers, from their perspectives it's a little bit maddening the goalposts keep moving,” Archambault said.

“(Businesses) are wondering what's the next change?” said Paul Pietro of Worcester's Mid-State Insurance Agency.

Pietro said he had a number of employers last year preparing for the original 2014 deadline before it moved. “Everyone is wondering what's going to stay in effect and what's not going to stay in effect.”

Across the nation, to the extent that employers change or drop insurance offerings as a result, Lischko said more people could seek insurance through individual exchanges. “All of these pieces fit together. Whenever there's a deadline that gets extended, it has unintended consequences.”

In Massachusetts, where lawmakers dropped an employer insurance mandate last year in anticipation of the federal rollout, that mandate could be revisited.

Archambault, with the right-leaning Pioneer Institute, said he anticipated problems in advance of rolling out the federal reforms in Massachusetts. “It was going to mean a lot of changes ... especially on the regulatory side.”

Comparing the Massachusetts and federal reforms, “no, these laws are different,” he said.

Related Slideshow: Massachusetts Emergency Care Report Card

The American College of Emergency Physicians released America's Emergency Care Environment report for 2014 in January, issuing report cards for each state in the U.S. Massachusetts ranked second overall - see the Bay State's report card grades and highlights in the slides below.