Health premium plan tries to balance fiscal viability for state, poor
by Statehouse News ServiceAUGUST 16, 2006 -- A single adult earning $29,000 would pay $100 per month for health insurance, with annual out-of-pocket pharmacy and surgery expenses capped at $500, under draft regulations for the state’s new health care plan.
Low-income working class enrollees who earn between double and triple the poverty line could access two types of plans, one charging a higher premium but lower service costs and the other leveling a lower premium but requiring higher per-service costs.
A subcommittee of the Commonwealth Health Insurance Connector Authority board plans to present its recommendations at a Thursday meeting, calling them “a good and practical starting point.”
Debate over what services to offer at which price is at the core of the health care reform’s implementation process that is unfolding in the face of a mandate that individuals have insurance by July 1, 2007.
The committee said its calculations were based on efforts to shift people who use the so-called uncompensated care pool over to the new “Commonwealth Care system,” to encourage low-income people to consider health insurance fiscally viable, and “stretching” the state’s health care dollars “to cover as many eligible residents as possible.”
The committee’s report, circulated in advance of tomorrow’s meeting, reads, “Despite their complexity, these issues boil down to one set of trade-offs: can most of the eligible population afford to buy insurance and access services, and can the state afford to cover them?”
Under the proposal, some families earning between double and triple the federal poverty level could devote up to seven percent of their income for health care, said John McDonough, executive director of Health Care for All, an advocacy group for expanded health care access.
“We think that the premium contributions are higher than what we think is affordable” for certain demographics, said McDonough.
Under proposed regulations, the incomes of those targeted for enrollment in these newly developing plans, which will be offered by four managed care organizations, range from $9,800 to $29,400 a year for individuals and from $13,200 a year for a family of two to $60,000 a year for a family of four.
Residents are required to purchase insurance by July 1, 2007, or face penalties through their state income taxes. The enrollment process is scheduled to begin Oct. 1, and the committee’s report acknowledges the authority needs to move quickly.
“The board is under an incredible time constraint to get a huge amount of work done,” McDonough said.
Under the cost-sharing schemes, enrollees above, but less than double, the federal poverty level could access only one low premium/low cost-sharing plan.
With implementation still evolving, officials acknowledged the likelihood their recommendations would change.
“The Committee fully expects that whatever the Board approves on August 17, 2006 will be evaluated and reconsidered over time, in light of experience and changed circumstances,” reads the executive summary.
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