Amanda Patterson

Being uninsured is a little bit like playing black jack, according to Dan Corboy, an ER doctor at Massachusetts General Hospital. The majority of adults under 35 are healthy, and being uninsured can be a big money saver. But accidents happen and for the minority who do get appendicitis or hit by a car, the economic fall-out could be severe.

Nationally, half a million people declared bankruptcy last year because of unpaid medical bills, according to Brian Rossman, Policy Director of Healthcare for All.

Fewer employers are offering insurance, fewer still are offering good insurance and premiums have risen steeply since 2000, according to The Kaiser Family Foundation data.

This leaves the 20-30 somethings exposed to significant financial risks, according to Kaiser researcher Katherine Hoffman.

“When something major happens, young adults are so economically vulnerable it really affects the trajectory of their lives,” Hoffman said.

Massachusetts has more insured residents than most states, yet 17.5 percent of adults aged 19-39 were uninsured in 2002. The number of uninsured, college-educated adults has doubled, and the incomes of the uninsured are going up, according to Massachusetts Health and Human Services.

No one has the numbers about poorly insured, people who pay for high-deductible “catastrophic” coverage. These plans often have a cut-off point, after which patients are on their own, according to Rossman.

“The only thing worse than being uninsured is paying to be uninsured,” Rossman said. “These plans don’t work for people, they are bad deals.”

Right now in the Commonwealth, employed adults under 65 who do not have a child, a disability, or AIDs do not qualify for Masshealth, the state Medicaid plan, even if they meet the federal poverty standard of $9,570. Any one else who needs health care but lacks insurance may qualify for the Free Care Pool, which could waive or reduce medical bills for people earning up to $38,000. Though it ensures that every one can get at least emergency care, the fund costs the insured directly, through a 1-2 percent tax levies on premiums, and indirectly.

The Free Care Pool receives $800 million from the state every year, and that isn’t enough. When hospitals can’t get reimbursed they have to re-coup their costs in other ways, according to Saul Franklin of the Insurance Commissioners Office.

“When that pool is exhausted, the only way they can recover their costs will be to raise rates. It impoverishes people who have health insurance,” Franklin said.

So Fix It

People are vulnerable and the Massachusetts legislature is trying to change the system. Right now, House and Senate have each passed different versions of the healthcare reform bill, and both plans have been in joint conference committee for nearly three months. Lawmakers have been unable to compromise and create a single plan which they would all vote on.

Bill sponsors are tight lipped about their progress, but there is some serious deadline pressure on the committee. If they don’t submit a final plan to the Centers for Medicaid and Medicare before March 1, it won’t be reviewed and approved by July 1 when the federal waiver granting essential money to Massachusetts. Which could amount to a million dollars a day, according to Rossman, who doubts the bill will be ready in time.

If legislation eventually passes, decent subsidized insurance will be available to more people. It’s just a matter of how many more, and how bad off they have to be to get help. And, of course, who pays for it.

Show Me the Money

Both plans make healthcare more affordable by increasing subsidies and negotiating better pricing with insurance companies. The House plan offers a lot, but doesn’t give an exact price tag.

The Senate’s version doesn’t cover as many people and relies more on “carrots and sticks”, but it does cover more people who are currently uninsured at a cost of about $117.8 for 2006.

The House plan mandates that citizens be insured unless they can’t afford it. They make it affordable by setting a sliding scale premium for people earning up to $28,700 and raising eligibility for a single parent with one child to 38,500. Single adults at the poverty level would have access to MassHealth.

The House would eliminate the $160 million dollars that businesses now contribute to the Uncompensated Care Pool and replace it with a 5-7% payroll tax. Employees covered by outside insurance would be subtracted from the payroll total, and employers would receive tax credit for their employee health expenses. In addition, federal money would be maximized and yearly tobacco settlement money would pay for health coverage.

Alternatively, the Senate would create incentives for insurers to provide coverage and study the possibility of insuring everyone. Coverage for adults under 25 would have to be offered by insurers and program eligibility for a new insurance program would be increased to $28,700 for families.

Like the president’s federal proposal, money put into “health savings accounts” would be tax-deductible. Small businesses would get increased insurance subsidies and large businesses who don’t offer insurance would have to pay medical expenses for employees using the Free Care Pool. Any one who declined coverage and then used the Free Care Pool would have to pay.

Amanda Patterson can be reached at apatterson@theoysteronline.com

02/22/2006   |   Permalink