Massachusetts Health Care Reform - Statute

Statute

The enacted statute, Chapter 58 of the Acts of 2006, established a system to require individuals, with a few exceptions, to obtain health insurance. Chapter 58 has several key provisions: the creation of the Health Connector; the establishment of the subsidized Commonwealth Care Health Insurance Program; the employer Fair Share Contribution and Free Rider Surcharge; and a requirement that each individual must show evidence of coverage on their income tax return or face a tax penalty, unless coverage was deemed unaffordable by the Health Connector. The statute also expands MassHealth (Medicaid and SCHIP) coverage for children of low income parents and restores MassHealth benefits like dental care and eyeglasses.

The legislation included a merger of the individual (non-group) insurance market into the small group market to allow individuals to get lower group insurance rates. The process of merging the two markets also froze the market for such insurance for a short period in April–May 2010 as the current government tried to keep the leading non-profit insurers, which insure over 90% of the residents, in the state from raising premiums for small businesses and individuals. Eventually the state's non-partisan insurance board ruled that the government did not have the acturarial data or right to freeze the premiums. Five of the non-profit insurers then settled for slightly lower premium increases than they had initially requested rather than litigate further. The sixth litigated and won the right to implement all its original increases retroactively. These findings only affect 2010 and the premium increase/review/litigation process will have to begin again for the insurance period beginning January 1, 2011.

Payment rates were supposed to be increased to hospitals and physicians under the statute but that has not happened. The statute also formed a "Health Care Quality and Cost Council" to issue quality standards and publicize provider performance. Many of the ideas proposed by this Council form the basis of the 2012 reform proposals introduced in early May 2012, a form of which are expected to be enacted by July 2012. Chapter 58 also set up a Disparities Council, funds automated prescription ordering in hospitals, and implements changes to the public health council, state insurance laws, mandated benefit requirements, and other health-related programs.