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Health Care Reform Financing

July 29, 2008 By philip-edmundson

The following is an op-ed piece issued to major newspapers and now being released on BlueMassGroup:

Massachusetts Healthcare Reform has been successful due to the confluence of  the interests of businesses, healthcare providers, insurers, government and consumers who together have borne additional costs allowing Massachusetts to reduce the number of uninsured  by over 350,000.    Governor Patrick’s new proposals to adequately fund the growing demands of our healthcare system by seeking support from all of these constituents is consistent with the shared responsibility which has brought us success to date.  

Opponents of the governor clothe their criticisms in false assumptions.  These critics contend that the basic proposition of healthcare reform was to shift subsidies away from institutions and toward consumers.  Other detractors contend that the per-worker assessment was intended by the law’s framers to go down over time.  Neither of these points is true.  The basic premise of the law was that a reduction in the number of uninsured required all stakeholders to contribute to the costs of success.  Logically, we can assume from this basic fact that as costs increase, they will be funded by this same variety of stakeholders.  

Indeed, the governor’s proposals are consistent with that premise.  Low income consumers have already begun paying more this month.  None of the governor’s critics remind us that one of the changes for the new fiscal year imparts higher premiums, deductibles and co-payments for consumers amounting to $30 million or more in costs to low income persons under Commonwealth Care.  

New costs to business under the Fair Share assessment were expected to amount to $171 million in the first three years according to the previous administration.  Instead, they have only amounted to less than $15 million.  Governor Patrick’s proposal to refine the definition of “fair and reasonable” contributions by businesses resulting in an additional $33 million in business contributions next year is still much lower than the original estimates that the business community signed on to in agreeing to support healthcare reform.  

Healthcare providers, insurers, and government are also being required to make additional payments under the governor’s proposals.  These funding sources respect the original concept of shared responsibility.  

Healthcare reform is very popular with the citizens of Massachusetts.  Polling indicates that large majorities of the population support the progress made so far and are willing to pay for it.  They support the concept of shared responsibilities between the public sector and the private sector.  They are proud of the leadership that Massachusetts has demonstrated in making more progress on the problem of the uninsured than any other state in the country in the last twenty years.  

The only alternative approaches to dealing with increasing costs are to cap enrollments or to make more assessments on the poor which would reverse the progress which we have made in the past year.  Massachusetts is proudest of its leaders who recognize that the compromises inherent in the governor’s plan are both in the original spirit of the legislation and the best way forward to make further progress.

Philip J. Edmundson is Chairman and CEO of William Gallagher Associates, an insurance brokerage firm as well as Chairman of MassACT!, a coalition of health care providers, insurers, business, and consumer groups

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Filed Under: User Tagged With: budget, finance, governor-patrick, health, health-care, health-care-reform

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