MASSACHUSETTS GOVERNOR SIGNS LANDMARK HEALTH INSURANCE REFORM BILL

Through private market reforms, all Massachusetts citizens to be insured by 2009 Governor Mitt Romney signed landmark legislation today that through a private, market-based reform will make health insurance available to every resident of Massachusetts within the next three years. “An achievement like this comes around once in a generation, and it proves that government can work when people of both parties reach across the aisle for the common good,” said Romney. “Today, Massachusetts is leading the way with health insurance for everyone, without a government takeover and without raising taxes.” The legislation was approved by a bipartisan 154-2 margin in the House of Representatives and a 37-0 vote in the Senate. It was signed at a Faneuil Hall ceremony attended by hundreds of people. “This would not have been possible without the courageous work of Senate President Travaglini, Speaker DiMasi, providers, insurers, consumer groups and all the other industry stakeholders who recognized an opportunity to do something historic,” said Romney. The law requires every individual in the state to purchase health insurance by July 1, 2007. Of the approximately 500,000 uninsured, about 100,000 are eligible for Medicaid, another 200,000 making less than 300 percent of the federal poverty level, but not eligible for Medicaid will receive premium assistance on an income-based sliding scale for policies with no deductibles, and another 200,000 with incomes above 300 percent FPL will be able to purchase lower-cost policies in the private market. Premium assistance will be financed by redirecting a portion of the $1 billion currently spent by state government on the uninsured. Beginning on January 1, 2008, failure by individuals to purchase health insurance will result in the loss of their state tax refund equal to 50 percent of an affordable health insurance premium. Penalties will be assessed for each month without creditable coverage. The creation of an entity, the Commonwealth Care Health Insurance Connector, will allow individuals to now purchase affordable plans on a pre-tax basis. The Connector will administer premium assistance for low-income individuals and facilitate employer contributions for both full-time and part-time workers and those working at more than one company. Eligible to purchase through the Connector are non-working individuals, working individuals at companies that do not offer health insurance, workers not eligible for coverage at their place of business such as part-timers, contractors and new employees, small businesses with 50 or fewer employees, and those who are self-employed. The legislation also enhances the goal of greater transparency in health care cost and quality through the collection and publication of data needed by consumers to make informed decisions. The information will allow consumers to compare the quality, track record and cost of hospitals and providers. The passage of the legislation moves Massachusetts closer to the implementation of a waiver that will allow the state to continue to receive $385 million in federal funding for each of the next two years. The waiver was negotiated by Governor Romney and Senator Kennedy last year, and was dependent on the state developing a “demonstration project” to reduce the rate of uninsured. The Executive Office of Health and Human Services has already begun providing details of the Massachusetts plan for review by federal Medicaid officials. Former U.S. Health and Human Services Secretary Tommy G. Thompson commended Governor Romney for signing what Thompson termed “groundbreaking legislation to provide health coverage to all Massachusetts families.” “Massachusetts is showing us a better way, one I hope policy makers in Statehouses and Congress will follow to build a healthier and stronger America,” said Thompson, a former Republican governor of Wisconsin. The Governor vetoed the creation of a new fee on businesses. The $295 per employee fee would have been assessed to employers with 11 or more full-time workers who do not offer and contribute to their employees’ health insurance. The Governor said the fee is “not necessary to implement or finance health care reform.” The Governor also vetoed a provision to provide dental benefits to adult Medicaid recipients, which will cost $75 million annually. Romney said the benefits expansion is financially unsustainable and noted that it provides a service not offered by most Massachusetts employers. Sixty percent of employers in Massachusetts do not provide dental coverage to their workers.