Mandatory Healthcare Law In Massachusetts
By Justin Gardner | Related entries in Health CareVery interesting development here.
The Governor of Mass is Mitt Romney and he’ll will be running for President in 2008. Now, he’s about to sign a bill into law that would help bring healthcare to 95% of the state’s uninsured population. This should attract a little love from the moderate left to be sure.
From Reuters:
The Massachusetts policy holds both businesses and employees responsible for health care coverage. Businesses with more than 10 employees that do not provide coverage for all staff must pay a $295 fee annually per uninsured worker.Under the legislation, which is expected to be approved by Massachusetts Governor Mitt Romney, insurance agencies would expand health care coverage by offering state-subsidized, low-cost insurance plans with scaled-back benefits.
However, that little stipulation about taxing residents for not having health insurance is sure to anger some:
Residents who can afford insurance but do not choose a plan by July 1, 2007, will face tax penalties that year, as incentive to take out insurance in an attempt to reduce health-care costs statewide.State health officials say the uninsured rely more on emergency room care and drive up insurance costs for everyone.
If they continue to choose not to enroll in subsequent years, they must pay the state half the cost of the lowest-priced insurance plan each year.
What if a plan like this were rolled out on a national scale? Would you support it?
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April 4th, 2006 at 9:26 pm
Mandatory Health Care In MA
from Donklephant (hat tip TMV)The Governor of Mass is Mitt Romney and he’ll will be running for President in 2008. Now, he’s about to sign a bill into law that would help bring healthcare to 95% of the state’s uninsured
April 4th, 2006 at 9:33 pm
Being a libertarian, probably not. I might support it if spending wasn’t already out of control, but under the circumstances, I doubt it. But I’d have to hear more of the nitty-gritty details.
April 4th, 2006 at 11:06 pm
While I’ve been supportive of this plan for a while, I wouldn’t support this plan (or a similar one) going national – yet. Let’s see how this one works out and changes the health care dynamics in the state. I say let federalism do its thing.
April 4th, 2006 at 11:54 pm
Essentially, MA has now declared health insurance a worker’s *entitlement*, as opposed to a benefit. That’s a dangerous precedent, so no, I could never support something like this nationally. It would turn into another windfall for the government, just like personal income tax did.
One can call the $295 per “uninsured worker” (isn’t this canard sorta like an “undocumented immigrant”? – they’re uninsured *people*!!) a “fee”, but it’s a fine, plain and simple, for not meeting the insurance entitlement. And I’m not sure I see how fining employers is going to improve the situation. It’ll be $295 to start, and if it’s kept, it’ll be raised (personal income tax was never supposed to go above something like 2%, remember?). The unintended consequences will ultimately be fewer hires because the fine will have to be factored into the cost of doing business. Or worse, if it’s cheaper to pay the fine than provide health care – ka-ching! – which one do you think a business with a slim profit margin is going to pick!? That’ll cause the fee to be raised for sure.
I guess it’s still not clear to me why people are under this misconception that it’s an employer’s responsibility to provide health care. The mindset we’re locked into is the real problem here. Medical costs are like a gas – they expand to fill the space they’re in. As long as we keep dreaming up new lateral ponzi schemes to expand that space – different ways in which Peter is constantly paying for Paul’s increasing health costs – the source of the problem will never be addressed.
As I’ve said before, the system is open-loop, and broken. Health care is a commodity – the cost should be dropping, not increasing. The reason it’s not is that the health care consumer can not exercise normal economic control over prices because of the “middleman”: the insurance provider. The insurance provider has little incentive to work hard at keeping costs down because more cash flow means more $$ in their pockets, and they can always raise the premiums, just as they’ve been doing for decades, and most people (read: employers, now) will be forced to pay them. Also, the insurance company has little incentive to work hard at being efficient because it’s easier to negotiate lower benefits or, again, raise premiums. Ultimately, it’s the consumer who is screwed. And now the employer. This is bad, bad news all around. Fining employers for not providing insurance only makes the problem worse.
April 5th, 2006 at 12:34 am
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April 5th, 2006 at 1:26 am
Massachusetts to Enact Universal Health Coverage
Massachusetts has taken a big step toward providing universal health coverage (hat tip to Donklephant and The Moderate Voice): The Massachusetts policy holds both businesses and employees responsible for health care coverage. Businesses with more than …
April 5th, 2006 at 5:04 am
Yay Statist entitlement mentality!
Go encroaching Big Brother, Go!
April 5th, 2006 at 1:06 pm
Goy, the problem is not that employers don’t offer health insurance- even McDonald’s has a plan, if you ask for it. The problem is that alot of employers offer really crappy plans. My last job, as a cashier in an airport gift shop, I ended up turning the insurance down bacause after I read the benefits I felt like they were going to take a big chunk of my paycheck, and give me very little in return. Fortunately, the company my husband works for offers a very nice plan- $10 for doctor’s visits, $50 for the ER, and $10 generic scripts. How many of you have it this good, unless you work for a huge corporation?
I believe this plan is meant to target the huge corporations who employ mainly a minimum wage workforce. These are often the people who can’t afford the insurance, and end up using the ER for primary care because the ERs *can’t* turn people away. And then those who do have insurance get stuck with helping to pay for them, either through insurance increases, higher doctor’s fees, or increased taxes.
It would be nice if someone could make the insurers charge more reasonable rates, but then you’d be complaining about the government trying to regulate private business…
April 6th, 2006 at 10:05 am
Seraphim, you’re missing the point (at least my point) entirely, I think.
As things currently operate, the natural economic regulation of the costs of health care as a commodity are confounded by the mechanism that’s currently in place.
Problem #1: Most employees rely on their employer to find a plan. Unless the employer is CIGNA, Kaiser, Aetna, Wellpointe or one of the other med. insurance companies, they aren’t in the business of hawking medical insurance, they’re in some other business, to make a profit in some other area – just like you make a profit when you give up your time to do something for your employer and are paid in return. It should then come as no surprise when the employer selects a “crappy” plan because it’s all their business plan will support when all the other employee-related costs of doing business are factored in.
Problem #2: Once you’re enrolled in a med. insurance plan, you completely lose any negotiating power you may have had over the actual cost of the medical products or services your ins. company is paying for (via your and your employer’s premium payments). See my previous post for how this works out in reality.
Problem #3: American workers have come to see health ins. not as a benefit, but as an *entitlement* (also see http://www.agoyandhisblog.com/?p=137 ). That notion is now being affirmed in spades by the MA legislature, and you’ll have to forgive me but your tone is just as good an example. You seem miffed that your employer doesn’t offer the same plan as your husband’s. It genuinely appears as if you have no sense of how expensive plans like these are – as a cost to the employer – per family. That they pay such a price is amazing, since they’re under no obligation to offer any sort of med. ins. plan whatsoever!
If individuals took what their employer pays for med. insurance as a raise, and contracted for their own services, paying out-of-pocket, there would be a painful adjustment period while the pharmaceutical companies and health services industry drastically increased their efficiency and reduced their cost to the health consumer. But in the end, commodity medical goods and services would find a more reasonable price equilibrium.
But politicians’ trapped-in-the-box thinking is pushing things in the opposite direction, which can *only* lead to rapidly increasing costs ( http://www.nchc.org/facts/cost.shtml ) because of the economic dynamics involved. The consmers’ trapped-in-the-box thinking keeps looking to politicians to solve the problem. The results will be more of what we’ve seen, and worse.
1. Employers must opt for the most reasonably priced plan they can find. That choice must reflect a cost that won’t drive them into bankruptcy the first time there’s a downturn in the economy (note: this is tangentially related to the dynamic that’s causing the protests and riots in France, BTW). Result: employees complain that they’re getting a “crappy” plan.
2. Insurance companies have no incentive to increase efficiency and reduce cost to the employer (or directly enrolled member). They also have little incentive to push health providers to lower their fees for service and cost of goods – it’s much easier to raise premiums. What’s more, the increased cash flow due to the higher prices all around only *adds* to their bottom line, so there’s at least a hinted conflict of interest here. Result: premiums consistently increase.
3. Health providers, doctors, surgeons, fertility clinics, pharmaceutical companies and all others who are paid by insurance companies have little incentive to increase efficiency or lower costs. They have leverage with insurance companies inasmuch as a big part of a plan’s value is where it can be used and what it covers. If an ins. co. doesn’t provide the benefit you’re looking for as health care provider, you can to refuse to accept that plan. Yes, it works both ways, but since people can’t seem to do without health care, the advantage is definitely on the side of the health care provider, and remember – they’ll get paid either way. Result: health care costs consistently increase.
Bottom line: the consumer is screwed.
The only reason we need anything more than catastrophic med. ins. (which is much less expensive, by the way) is because the costs of commodity health care are skyrocketing. The costs of commodity health care are skyrocketing because the med. ins. arrangement we have in place takes normal commodity cost control mechanisms out of the process. It’s a Catch-22 that can only be resolved by taking a completely new approach, i.e., going back to the way all other commodities are purchased: directly.
April 7th, 2006 at 5:03 pm
I am a resident of Massachusetts, and I assure you that people who are informed of this idea of mandatory health care insurance are not happy. By those who are informed, let me say that the legislature and Romney are moving at lightening speed before anyone can actually find out what the whole idea entails. Let me also say that Massachusetts has a mandatory auto insurance law, and our insurance agencies are noncompetitive. Yes, you’ve got it, mandatory noncompetitive auto insurance that cost the average of 2 1/2 times the amount of the same coverage in any other state. As well, if you have a child that turns 18, your policy payment jumps to its highest point and your payments skyrocket (roughly 1,600) a year for the additional driver, until such time as you prove that your child will not be driving your car or lives at home with you. How do you prove this, well, you sign a form that the insurance companies send to you – well, eventually – send to you. So, with that in mind, let’s be honest where this “mandatory health care insurance issue” is going, and whom it benefits.
As well, the government decides who will pay what amount for what coverage. Typical rhetoric when government says “affordable.” Affordable by whose standard? You see they don’t really have to worry do they. We pay the governments health care insurance premiums with our tax monies, which means they receive “socialized medicine,” while they in turn, are going to require everyone to cover him or herself at a rate that “they” deem appropriate and affordable. Go figure!
And of all of that isn’t bad enough, how about a novel idea of, oh, let’s just say, looking into the whole premise of having health care a “for profit business” to begin with let alone the insurance companies being “for profit.”
April 7th, 2006 at 5:23 pm
SilverSeraphim,
Nothing about this mandatory health care insurance is Massachusetts is directed at “lowering” the cost – least of all to the consumers. I have listened to the health care agents – BlueCross and Harvard Pilgrim all day talk about the benefits of the program, along whit Romney and some of our legislators, but I have yet to hear any “actual” talk about how it will lower cost for anyone. Yes, that’s the premise, but hey, when they upped my taxes a few years ago on the premise that they would be lowered when we “got through the crunch” they never did. Look, when health insurance is a “for profitâ€Â? business than the very premise of making it mandatory is bogus to begin with. There is no “publicâ€Â? side to this. The media is pushing this idea and the peoples’ voices are not what they are reporting. The average cost I heard today was that it will cost 325 a month – 325 is affordable? To whom? Romney compared the program to “buying a car.â€Â? You get what you can afford. Thus, many will be required to buy into substandard programs causing people to not only pay their premiums (mandatory) but to pay for all services that are not covered. The same premise for those people who don’t buy health insurance coverage because the cost does not offer benefits will now become mandatory.
Health care is not free. If one gets hurt and goes to the doctor/hospital, one is responsible for the payment. Period dot. There is no exception here is Massachusetts. It used to be – way back when – that if you couldn’t afford insurance hospitals couldn’t turn you away and you weren’t responsible. Now hospitals require that you sign a document, before they will administer treatment, which says that you are legally responsible for payment. And they will go after you.
April 7th, 2006 at 5:33 pm
The mere premise that health care is a for profit business and health care insurance is a for profit business in and of itself requires that the premiums continually rise. That employers have to “lock” themselves into – as do most employees i.e., once you choose a plan you cannot change it until the insurance company, along with your employer, open the “open enrollmentâ€Â? only allows for premiums to continually rise.
Now aside of all the flaws of the current state of health care cost, Massachusetts wants mandatory health care insurance from all of its residents. When does the government have the right to tell any one of us that we have to have mandatory medical coverage and they determine 1) how much it will cost, and 2) how much each person will pay….
September 14th, 2006 at 11:49 am
This bill is unconstitutional. Indeed, more and more of what passes itself off as “for the people” is really about the politicians and business owners–and in this case the insurance industry. Mandatory health insurance is a tax. Plain and simply. Like all taxes, anyone who does not pay will be punished. What makes this bill so dangerous is the provision that places stiff fines on those who refuse to pay or who cannot pay but who have not obtained a “waiver.” This is legal extortion–nothinig more and nothing less. Politicians and others who support this bill are trying to distract tax payers with the rhetoric of social responsibility and individual responsibility. However, when I am sick that is no one’s business but my own. If I die of a disease that is my problem. If I seek out medical care and don’t pay the bill, then the hospital has the legal right to sue me for payment. In fact, this is the only industrial country in the world in which people routinely lose their homes and life savings and go into debt because of hospital bills.
Also, will the government now have direct and open access to tax payers medical records? The government will be asking “detailed” questions about our insurance purchases on state income tax forms once this bill has been implemented. Why should anyone believe that they will have a reasonable expectation of medical privacy when the government now has a direct line to our most personal and private dealings with the medical establishment? I say that the people–us who do not agree with government racketeering–should file a class action suit against the Massachusetts State Legislature on the grounds that a mandatory health insurance bill that fines those who do not purchase health insurance is unconstitutional and a form of covert government surveillance.
December 10th, 2007 at 10:34 am
When did we abdicated our freedom of choice?
I just happened on this website while searching for the past week on the subject of FORCED health insurance, as the encroaching deadline approaches.
I was taken aback to read a year old discussions on the ‘mandate’. Not by the people of Massachusetts!
Unfortunately, my husband and I first heard of it in May/June 2007, when we received a ‘postcard’ by the State informing us that as of July 1, 2007 we better be getting health coverage or lose the personal deduction on the income tax in April 2008.
With my husband unemployed and bigger fish to fry, we didn’t give the abuse much thought until the end of the summer.
During a visit to my doctor, paid out of pocket, she kept badgering me about getting insurance.
I was highly irritated. When I schedule a doctor’s visit is to seek medical opinion, not advice on other life’s decisions, nor about how to handle our finances. That’s for sure! Despite informing her several times that both my husband and I were unemployed and could not afford it, she continued to insist that we get insurance. The State, according to her and the lies it spread has made it affordable.
After researching the options I concluded that what the State “deems” affordable is miles apart from reality.
I strongly resent having to give up my personal information for the state to evaluate what I need/should afford.
Add to that, the bewilderment created by discussions with other people. Although, most have little or no discernment of the implications regarding the Mandate, they feel qualified to put forth advice.
The same unsolicited advice I had to endure during my obgyn exam. Yes, while being examined, I had to put up with the doctor argumentation about something that is none of her business. It appears the State has enlisted the help of physicians to subdue those patients that are still able to reason.
In theory, “insurance for everyone†sounds terrific. Matter of fact is anything but! Those that favor it can be placed in 3 categories: the uninformed, the deluded, and the willing offenders. While I pity the ignorant and the deluded, I cannot condone the ones eager to garnish the control of my life and my wages.
Why didn’t the state let the people vote on this? Why does the State feel it has a right to come up with a new tax, under the “guise” of “caring for its citizens”? All rhetorical questions, because the State knew the overwhelming majority could not be fooled. The one exception was to pass it sub rosa, exacting an unjustified, unfair tax from those who comply. For the rest, the “law-breakers†it schemed a fine on the next income tax, and a massive fine for each month in 2008.
THIS IS ABUSE AT ITS WORST! Are the residents of Massachusetts so sedated, so accustomed to being taken advantage of that they cannot stand up and fight the prevarication that we are better off with this mandate than without it?
December 10th, 2007 at 11:13 am
P.Carter and Sick&Tired great points!
Let me add my 2-cents on the compulsive insurance that as P.Carter writes is non-competitive.
As much as I hate it, when it pertains to auto insurance, one has the choice not to have a vehicle. Trust me, I am not advocating we start walking or taking mass transportation, by any means.
However, when it comes to health insurance, the ONLY option is to move out state. Something, my husband and I are seriously considering.
If ‘city hall’ cannot be fought, we are not going to lie down and die.
One more thought. The safeguard of our privacy from all angles is a daily struggle. Then this bill comes along, and in the name of “health insurance” we are supposed to bend down and take it? Not a chance! I don’t want the State or the Insurance Company to snoop in my personal life.
What is next? Will they refuse medical treatment for those that have no insurance but can pay out of their pockets?
We have never been a strain on the system, whether single or married. Way taxes through the nose. One thing we will not accept is to get robbed further.
SilverS. ~ I understand your predicament, fully. Through our married life, we have had medical insurance through the employer, and gone without it when my husband was sel-employed.
This law crammed down our throats, without the possibility to opt out is NOT the solution.
Companies are in a better position to negotiate rates/premiums with Insurance Companies than individuals. It’s just the way it is. It’s called leverage.
December 10th, 2007 at 12:03 pm
Addendum ~
JustThinking, I missed your comments on my initial cursory reading. You too, hit the nail on the head.
This “entitlement” that those with a brain didn’t ask for, and those with 1/2 a brain applaud is no bargain to the residents of Taxachusetts! Unless, of course, one happens to fall in the income bracket that gets everything for free, paid by none other than the taxpayers!
Goy ~
your insights duly noted, I contend the biggest burden is on individuals/family forced to comply or else, rather than employers. At least, not the big companies.
December 10th, 2007 at 5:55 pm
Whose insurance cost would amount to $325/mo.?
I have gone over and over the “affordability tool” at the MAconnector website, more aptly nicked, “ShootMeNow” website, and the best I can come up with in the “affordable” range is $720/mo. for a grand total of $8,620/yr.
Why would anyone of sane mind WILLINGLY cough up a fixed sum every month when typically that would be a non-existent expense.
To sum it up. The State of Massachusetts put in action a plan to rob its citizens at gunpoint with the blessing of Governor Romney.
Interestingly, he shuns talking of his own accomplishment making one wonder if he realized the error of his ways.
January 1st, 2008 at 7:33 am
Ok every person in Massachusatts I have an observation. From the looks of it I believe you could do the whole country a lot of good and follow the example of your forefathers and throw a little tea party, it is now long past time, on second thought it is time for the country as a whole to throw a tea party. but we won’t because our politicians have got us all running scared. If you think you are scared now , just wait till they get done with this crap!!!
January 1st, 2008 at 1:04 pm
Carrie,
You are absolutely right, it is time for another tea party. The citizens of Massachusetts need to take back democracy and show our leaders that this kind of abuse will not stand. Look for a thorough house cleaning in the 2008 state elections. It is time to send these extortionist lackeys of the insurance industry packing!