NCPA - National Center for Policy Analysis


December 17, 2007

Massachusetts's universal health-care plan is turning out to be more expensive than predicted.  Now the state is looking at cutting payments to doctors and hospitals next year to make ends meet, says the Boston Globe.

That fiscal reaction, which some critics of the plan warned about, sends a stark message to the other 49 states.  Massachusetts has become something of a model for the national plans proposed by Hillary Clinton and John Edwards, among others:

  • The state requires everybody to buy health insurance.
  • A subsidized health plan offered to the poor as part of the program has proved more popular than expected, and that's helping to push costs 20 percent over what the state had budgeted.
  • The tab could run $619 million for the current fiscal year, $147 million over budget, the Boston Globe reports.

Now the board that oversees the plans has approved cuts of 3 percent to 5 percent in reimbursements to health-care providers caring for those in the subsidized plan.  The Globe suggests the cuts will bring reimbursement in line with Medicaid.

The board postponed a decision on a more controversial issue: whether to raise co-pays and other out-of-pocket costs for those whose income is above the poverty level.  Those with subsidized insurance pay much less than those with private insurance for doctor visits, prescription drugs and hospital care cost, according to the Globe.

Source: Jacob Goldstein, "Mass. To Cut Payments to Docs & Hospitals," Wall Street Journal, December 14, 2007; based upon: Alice Dembner, "Mass. panel approves changes to subsidized residents health plan," Boston Globe, December 14, 2007.

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