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September 26, 2006

Massachusetts Health Care Reform Law Questioned

The State of Massachusetts took a bold step earlier this year when it enacted a “play or pay” health insurance reform law. The law generated a lot of headlines. It was proposed by a Republican governor and enacted by a largely Democratic legislature. Individuals from both sides of the isle are looking at the new law as a model for other states to follow.

The Maryland Chamber believes that, although there may be some parts of the law that provide guidance for other states, the Massachusetts law leaves many important questions unanswered:

  • What is the cost of the program – no one seems to have a good estimate of the fiscal impact of the program or how it will be funded in the long term. The law appears to have little or no cost containment provisions.
  • How will the state certify affordable health insurance plans while keeping all of the state-mandated services?
  • Will the state actually have the political will to fine individuals who fail to purchase health insurance?
  • Can the state successfully integrate data systems to match employers with the individuals using free hospital services?
  • Will the legislature increase the assessment on employers if (when) the program funding proves inadequate?
  • Do parts of this act violate federal law?

Now, the Bureau of National Affairs (BNA) has published a report it believes answers that final question. In its Health Care Policy report dated September 18, a prominent health care attorney concludes that three key provisions of the Massachusetts law are preempted by the Employee Retirement Income Security Act (ERISA). You can view the report here (pdf). For more information, contact Ron Wineholt at rwineholt@mdchamber.org.

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