439,000 more get health coverage
State shows big gains in landmark program
Nearly three-quarters of previously uninsured Massachusetts residents now have medical coverage under the state's landmark campaign to extend health insurance to virtually all Bay Staters, according to a report released yesterday by Governor Deval Patrick's administration.
Since the program's launch in June 2006, 439,000 more people have enrolled in health insurance, and nearly half of them signed up for private insurance not funded by taxpayers, says the report from the Division of Health Care Finance and Policy. Before 2006, studies had estimated that about 600,000 Massachusetts residents lacked health insurance.
The dramatic expansion has spurred a substantial drop in patients seeking routine care in hospital emergency rooms, where treatment is much more expensive. The reduction is already saving the state millions of dollars, the quarterly report said.
In the past two years, Massachusetts has embarked on a closely watched experiment to become the first state requiring virtually all residents to have health insurance. The figures released yesterday provide some of the most compelling evidence so far that the experiment is working.
"This shows a cultural shift in public attitude, where people understand that as a community, by everyone getting health insurance, we are improving the health of everybody," said Brian Rosman, research director of Health Care for All, one of the state's largest consumer groups.
Still, the economics of the ambitious campaign remains uncertain. Massachusetts is locked in delicate negotiations with federal authorities to determine if the state will continue getting billions of dollars in special assistance to help make the experiment work.
Dr. JudyAnn Bigby, the state's secretary of Health and Human Services, said that the latest enrollment figures should bolster the state's case with the federal government.
"It shows them that it's a good model for Massachusetts," Bigby said in an interview. "The intent of healthcare reform was that if people were getting coverage," then the number of patients relying on the state and hospitals to pick up the tab for their care would decline, she said.
That appears to be happening. For example, from July through September 2007, the most recent period for which data is available, the number of visits to hospitals and community health centers by the uninsured declined by 37 percent, compared with the same period a year earlier, the report said. That drop translated to a $68 million savings in the pool of money the state sets aside to cover the uninsured.
Massachusetts has requested more than $11 billion in federal support during the next three years to pay for dozens of healthcare programs, including its crown jewel, its nearly universal health coverage system. The federal payments, which are crucial to keeping the landmark program afloat, were set to expire June 30, but the state has received four extensions. The deadline for reaching an agreement with the Centers for Medicare & Medicaid Services is now Monday.
Bigby said that during negotiations, federal regulators have asked for data to determine whether the number of uninsured was declining. They have also wanted to see whether employers were dropping coverage and dumping employees on the state's subsidized system, she said.
The new report debunks those fears. In fact, a substantial share of the newly uninsured are opting for private coverage that does not cost the state money. Nearly half of the newly insured are enrolled in private health insurance and the largest group, 159,000 people, signed up for employer-sponsored health coverage from June 2006 through March 2008, the report said.
"That 159,000 is almost twice what was projected. It translates into almost $1 billion more spent by employers on premiums," said Michael Widmer, president of the Massachusetts Taxpayers Foundation, a business-funded public policy group.
The business community has been sparring with the Patrick administration over proposed state regulations intended to help close a gap in funding the healthcare law. Those rules, scheduled to take effect Oct. 1, would raise about $45 million this fiscal year.
The rules would require businesses with 11 or more full-time employees to pay at least one-third of full-time workers' premiums and make sure that at least 25 percent of their full-time workers are covered by an employer plan. Employers who fail to meet this requirement face an annual penalty of $295 per worker.
Widmer said the new report, showing that 159,000 residents have gained insurance through their employers "makes a mockery of the state's allegation that employers have not done their fair share."
In the final months of 2007, state officials and healthcare advocates launched an advertising blitz, reminding residents that the law now required nearly everyone to have insurance or face a $219 tax penalty. Data released by the state yesterday indicate that the ad campaign paid off: More people signed up in the second half of 2007 than in any other six-month period since the healthcare law took effect.
Kay Lazar can be reached at klazar@globe.com. 