Four Lessons From Massachusetts Health Reform

HealthLeaders Media Staff, September 23, 2009

While senators battle on Capitol Hill this week about the Senate Finance Committee's health reform proposal, I'm left wondering what will actually stick.

Will the public option make it through the sausage factory on Capitol Hill? I don't think so. Will health reform include meaningful cost controls? That's possible, but not probable.

One idea that could make it as a compromise to the public option and insurance co-operatives is an insurance exchange that could be run federally or more likely at the state level with seed money from the feds.

The benefit to the insurance exchange is that there is a test case at the state level. As part of its massive health reform plan in 2006, Massachusetts created the Commonwealth Health Insurance Connector Authority, which oversees the reform effort.

A key part of the program is the insurance exchange Web site that allows Bay Staters to compare available health plans by costs and benefit designs. Federal policymakers and health leaders can learn from the Massachusetts program when creating an exchange.

Greg DeBor, a partner in CSC's Healthcare Group, partnered with the commonwealth to develop the Connector Web site, and coauthor of a white paper about the Massachusetts experience, says The Bay State's experiment is the "best learning lab for policymakers on the Hill."

Here are four lessons from Massachusetts' insurance exchange:

If you don't require coverage, don't expect many to sign up
As I wrote in March, I am surprised the individual mandate is still even part of the debate. It's not that I don't think it's a good idea, but when Hillary Clinton withdrew from the presidential race last summer, I thought any hope of an individual mandate left with her.

At the time, both remaining major presidential candidates were against the idea, but President Barack Obama now says he's open to the individual mandate as part of a larger health reform package.

Requiring everyone to have health insurance will be a tough sell in Congress, but the Massachusetts experience shows that the mandate is needed if lawmakers expect millions—especially the young and healthy—to buy insurance.

Massachusetts officials found that the uninsured didn't flock to the Connector Web site to find a plan until they were required to buy insurance or face a fine.

In other words, if you don't force people to buy health insurance, they will find more enjoyable ways to spend their money.

DeBor says a mandate would "make it easier."

"People simply weren't looking for a simpler way to buy insurance and then rushed out and bought it. They had to be told that this was required of them," says DeBor.

Educate prospective members about healthcare and health insurance
When creating the exchange Web site, Massachusetts learned education was the first step—and not just education about the plans that are available. They needed to know the very basics. What is insurance? What's a premium? How do you find a doctor? These questions are common knowledge to the insured, but for those without insurance they are foreign concepts.

Program officials had to first tell the uninsured about insurance and why they needed it—and speak at a level that everyone could understand. Plus, for those shopping for individual health insurance, program leaders needed to educate people who were covered through an employer previously about the individual health insurance market.

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