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Countdown to coverage

On July 1, state law requires every adult to have health insurance if affordable plans are available. There are many options. The following is a guide to those choices.

Email|Print| Text size + By Alice Dembner
Globe Staff / June 18, 2007

More than 135,000 Massachusetts residents who were previously uninsured have gotten free or subsidized coverage under the state's landmark health insurance law. The initiative established Massachusetts as the first state to require every resident to have coverage. An estimated 250,000 to 350,000 people remain uninsured. The law mandated the expansion of Medicaid and the establishment of new state-subsidized insurance and lower-cost private plans. It also pressed businesses to provide insurance for their workers. Here are answers to some key questions about the insurance requirement.

Q Is the July 1 deadline real?

A The law requires every adult to have insurance by the beginning of next month. But no one will be subject to a penalty as long as he or she buys insurance by Dec. 31.

Q Will any insurance, including just catastrophic coverage, meet the requirement?

A Yes, this year. But, as of January 2009, more comprehensive insurance is required.

Q Do individuals need to buy policies that cover prescription drugs?

A Not this year. But everyone must have drug coverage by January 2009. State officials decided that drug coverage is an essential part of health insurance because medicines are a critical part of healthcare.

Q Why is the state requiring everyone to have insurance?

A Policy makers were concerned about the health of Massachusetts residents without insurance and about the growing cost of state-paid charity care at hospitals. In addition, the federal government threatened to withhold $385 million a year unless the state reduced the number of uninsured people. Advocates, analysts, and public officials proposed different ways to provide insurance coverage for more people that resulted in a bill signed into law in April last year.

Q How much will this insurance initiative cost taxpayers?

A The total cost is expected to be about $1.7 billion this year, paid for by state and federal funds and assessments on hospitals and insurers. Most of that money was already be-

ing spent for public healthcare programs. Individuals may also face new costs to purchase insurance or upgrade coverage to meet new standards for 2009.

Q Who is deciding what individuals must do?

A The law set out the basic requirements that individuals buy insurance and that businesses be encouraged to provide it. But it left many specific decisions to a new agency, The Commonwealth Health Insurance Connector Authority. The connector is overseen by a 10-member board that includes consumer and labor activists, state officials, insurance specialists, and a representative of the business community.

Q What help is available to cover children?

A The state expanded Medicaid coverage for children to include those from families with incomes up to 300 percent of the federal poverty level -- $51,510 for a family of three. In addition, parents can buy Commonwealth Choice plans for their family or just for their children, which may cost less than market rates.

Q Are there any breaks for healthy young adults?

A Yes, the law authorized special insurance plans for adults age 19 to 26 who are not offered insurance through work. These plans, available only through the Commonwealth Health Insurance Connector, have inexpensive premiums, but nearly all offer limited coverage. In addition, young adults may be covered under their parents' insurance for up to two years after they are no longer dependents, or up to age 26, whichever comes sooner.

Q Isn't there a long standing state program that helps low-income workers pay for premiums?

A The Insurance Partnership subsidizes work-based insurance for people with incomes up to 300 percent of the federal poverty level who work at companies with 50 or fewer employees. Some other rules apply, so not everyone can get this benefit. Information is available at 1-800-399-8285 or www.4ip.org.

Q If someone can't afford insurance, how can they get medical care?

A Some doctors will provide discounted fees for low-income patients. In addition, the state plans to continue to fund some charity care at hospitals and community health centers through the Health Safety Net Trust Fund, which will replace the "free care pool."

Q Under the new insurance law, what are employers required to do?

A Companies with 11 or more workers must provide a "fair and reasonable" contribution to their employees' health insurance or pay an annual fee of up to $295 per worker. In addition, they must allow employees to pay insurance premiums through pre-tax payroll deductions, which saves money for both the companies and employees. The savings for workers can be up to 40 percent of the premiums. Companies that don't provide the tax benefit and whose employees or dependents use the free care pool may face a fine.

Q How is the state going to enforce the insurance requirement?

A Individuals will be required to certify on their annual income tax forms that they have insurance. The state will cross-check those forms with records from insurance companies and employers.

Q Will the state consider individual hardships when deciding who will face a penalty?

A Yes, there are criteria for appeal of the penalties that include homelessness, significant unexpected expenses as a result of illness or death of a family member, or large family size.

Q Are people who get care through the Veterans Affairs system considered to be insured under the new law?

A An individual enrolled in the VA health system is considered insured under the new law. Those eligible for VA health services but not enrolled must have other insurance.

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