LOWELL, MASS. -- Massachusetts Governor Charlie Baker spoke with LowellSun reporters about aspects of the state’s healthcare experience -- including before and during the Affordable Care Act law -- and what insights he offered the Federal government on an ACA replacement plan.
One result of ACA was 350,000 working people, who used to be covered by their employers’ health plans, went onto the state’s health plan, MassHealth. Before ACA, MassHealth was a health insurance program for unemployed people and children that do not have access to health insurance -- Medicaid and the Children’s Health Insurance Program (CHIP) combined as the state’s healthcare safety net.
That plan, along with the state’s ACA healthcare marketplace the Health Connector, was leveraged when healthcare reform went into effect beginning in 2014.
Flight of Massachusetts Workers to Medicaid Under ACA
One attendee at the talk noted that a former employer offered a stipend to employees that opted to go on MassHealth (the “opt-out” option), instead of joining the company’s group policy. That was allowed under federal law, Baker said.
Baker explained that in two years under ACA, MassHealth went from serving about 19 percent to 26 percent of the people in Massachusetts with health insurance coverage, while employer plans went from serving 56 percent to 49 percent of the covered population. That was also exacerbated when the “Connector broke,” a problem he inherited when he became governor in January, 2015.
“Those two numbers moved exactly in tandem with each other,” said Baker, who noted that the state is dealing with “month-over-month-over-month” movement of people going off private coverage and going on the state’s Medicaid/CHIP program under ACA, which now accounts for about 40 percent of the state’s budget.
The data also shows a significant drop in employer-based coverage opportunities, and the total number of people covered by health insurance in Massachusetts hasn’t changed much at all, he said.
It used to be that Massachusetts’ employers could pay into the Health Connector, and their employees could go on it and buy a plan. The state operated the Massachusetts Insurance Partnership after the state passed a health care reform law in 2006. That was an option for smaller businesses challenged to establish and fund group insurance plans for their employees. Under ACA, Massachusetts small businesses were referred to the Small Business Health Options Program (SHOP) marketplace.
What Baker Recommends
In a very-detailed, 9-page letter Baker sent to House Majority Leader California Representative Kevin McCarthy last month -- which defended parts of the ACA -- the Governor indicated Massachusetts would like the flexibility to return to a structure similar to what Baker said worked for the state before ACA. His key point:
“I think if we go back to the firewall, gave people the ability for employers to offer pre-tax funding to people who bought plans through the Connector, gave people the ability to pay with pre-tax money to purchase plans through the Connector, I think we could deal with this and make sure people are covered and have insurance,” and stop the state’s bleeding on this issue.
Baker’s third annual budget reportedly includes a $997 million increase for MassHealth, along with proposed reforms intended to control costs. One of those reforms is an assessment on employers with 11 or more workers who do not offer health insurance.
In the late 1990s, the Massachusetts Insurance Commissioner, the late Linda Ruthardt, appointed Baker chief executive officer (CEO) to Harvard Pilgrim Healthcare to oversee it’s receivership as insolvency loomed.
It didn’t go bankrupt. While CEO, Harvard Pilgrim Healthcare’s membership rose from 750,000 to more than 1 million subscribers.
