Unrealistic health plan

By Eileen McNamara, Boston Globe Columnist  |  September 13, 2006

It is clear to Dr. Paul Hattis how few actual low-income people state regulators spoke with before they set insurance rates for the Commonwealth's new universal healthcare law. Although dramatically cheaper than market rates, the subsidized premiums are beyond the reach of a large swath of the working poor in Massachusetts.

Hattis, a professor of healthcare policy at Tufts University School of Medicine, matched the rates set by regulators two weeks ago against the income and expenses of actual human beings, and, ``for too many people, the numbers just don't add up," he said.

Hattis analyzed the financial data provided by 350 low-income people, 108 of whom earn 100 percent to 300 percent of the federal poverty level, $9,804 to $29,412 a year.

Nearly half of that group, 46 percent, could not afford to pay the rates, between $18 and $106 a month, that were set by the new Commonwealth Connector Board. That does not include the copayment and other out-of-pocket expenses that are likely to be part of the subsidized health insurance plans.

The individuals sampled were members of religious congregations of the Greater Boston Interfaith Organization, one of the prime movers behind the push for healthcare reform in the state. The group has been holding workshops for weeks across Eastern Massachusetts to determine what people can really afford to pay.

``These are not people with huge amounts of discretionary income," Hattis noted. ``A large number, 43 percent, said they already have negative cash flow every month. How realistic is it to mandate payments people can't make?"

That is just the question that Paul Weiner is asking. His three part-time jobs -- as a freelance illustrator, a telephone researcher, and a security guard -- earn the 55-year-old just under $20,000 a year. It is enough money to rent an apartment in Mission Hill and meet his basic expenses, but he cannot afford health insurance now and suspects he will not be able to afford it under the new health law.

``I've been fortunate; my health is good," he said. ``But my luck is not going to last forever. I know I need health insurance. I am willing to pay what I can, but I am not going to be able to pay $70 a month."

The law, passed with much fanfare earlier this year, requires all Massachusetts residents to have health insurance by next July or face tax penalties. Employers that do not offer health insurance will be assessed a nominal $295 per employee per year to defray the cost of the state subsidized insurance plans.

The cost to employers was kept artificially low to win passage of the bill, but to make this law work, the state is going to have to raise that assessment or find another revenue stream.

``This is an ambitious law, but it needs to be a realistic one," Hattis said. ``It is a complicated balance. The state does not want to set premiums so low that employers who now offer insurance start to drop coverage and let their workers sign up for this program, but the individual mandate cannot be more than people can realistically pay."

Why aren't the three rivals for the Democratic gubernatorial nomination talking about this? It is all well and good to support universal health coverage, but it makes no sense to adopt rates that half of the uninsured cannot afford.

The Greater Boston Interfaith Organization is sponsoring a forum Sunday to ask all the candidates for governor -- including Lieutenant Governor Kerry Healey, a Republican, and Christy Mihos, an independent -- to discuss how they would make this landmark law work in the real world. Organizers expect 1,000 people, many of them from the income bracket targeted by this law, to come armed with questions.

To date, only Deval Patrick has confirmed that he will be there. What else could the other candidates possibly have to do that is more important than this?

Eileen McNamara is a Globe columnist. She can be reached at mcnamara@globe.com .