New waiver continues Massachusetts health insurance pools

Washington -- State and federal officials have agreed on a $21.2 billion, three-year waiver that will let Massachusetts continue its landmark Commonwealth Connector health system reform through 2011.

The waiver, announced Sept. 30, is $4.3 billion larger than the state's previous waiver. That one expired June 30 but was extended while negotiations continued. At press time, officials had not signed the new waiver but expected to within weeks, said Jennifer Kritz, spokeswoman for the Massachusetts Executive Office of Health and Human Services.

The agreement is a significant step in the drive to cover more uninsured residents, said Bruce Auerbach, MD, Massachusetts Medical Society president. "That was at serious risk if the waiver had not gone through."

About 440,000 people have signed up for public or private health coverage since the state began implementing the reforms in 2006. A requirement that individuals have health insurance went into effect last year.

The waiver will provide the support to fund Commonwealth Care insurance plans for those earning 300% of the federal poverty level or less. Residents earning more than 300% of the poverty level can sign up for private, unsubsidized coverage through Commonwealth Choice.

Massachusetts Gov. Deval Patrick also is expanding the program's contribution requirements for businesses. Firms with more than 10 employees that do not provide insurance for enough workers have been required since 2006 to contribute to a state health care fund. On Sept. 29 the rule was amended to require firms with more than 50 workers to contribute unless they cover at least a third of premiums for at least a quarter of their workers.

That amendment will take effect on Jan 1, 2009, and is expected to raise an additional $22.5 million for the state health care fund, Kritz said.

The Bush administration is committed to reforms like Commonwealth Connector, said Health and Human Services Secretary Michael Leavitt. "This helps provide patients with choice and responsibility in obtaining the coverage that best suits their health care needs."

But the Connector program has cost millions more than anticipated because of higher-than-expected enrollment in Commonwealth Care plans and a decision by the agency managing the program to offer virtually free coverage to enrollees earning up to 150% of the poverty level instead of 100%. Enrollment in the unsubsidized Choice plans has lagged.

Dr. Auerbach also said the state still faces a shortage of primary care doctors. "It's another piece of the puzzle that needs to be addressed if we're going to create universal access."