NCPA - National Center for Policy Analysis


March 7, 2007

Massachusetts residents trying to comply with the ambitious state law that mandates universal health insurance in the state are in sticker shock, says Devon Herrick, a senior fellow with the National Center for Policy Analysis.

The problem with the plan, says Herrick, is that estimates obtained do not reflect actual prices:

  • Then-Gov. Mitt Romney estimated coverage could be obtained through the state-run "Connector" -- which allows those who don't have access to employer-based insurance to obtain coverage -- for as little as $200 per month.
  • However, this January, when the state-run Connector announced its minimum plan requirements, some insurers projected their premiums would run as high as $380 per month -- nearly double the earlier estimate.

Edmund Haislmaier, a researcher with the Heritage Foundation, says insurance carriers are partly at fault for padding their estimates.  In January, Connector officials decided to delay a vote on minimum coverage requirements until March 8, to allow insurers time to revise their bids. That, Haislmaier said, illustrates how the Connector was designed to work through problems.

Others are not so confident in the program, says Herrick.  They say they believe this may be only the first of many cases of sticker shock.

According to professor Alan Sager, co-director of Boston University's Health Reform Program, "The April 2006 Massachusetts legislation has no cost control provisions. To cover more people, it therefore boosts health spending, mainly through higher payments by individuals and families -- many of whom can't afford the premiums they are being asked to pay."

Source: Devon Herrick, "Mass. Mandate May Cost Twice Early Estimate," Heartland Institute, April 1, 2007.


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