The secrets of Massachusetts' success (including bigger carrots and smaller sticks)

Robert Restuccia, Executive Director of Community Catalyst, writes about the less-talked-about lessons from Massachusetts-style health reform.

Massachusetts as model – it’s a common claim in health policy circles. With the lowest rate of uninsured residents in the nation – just 2.7 percent – it’s clear to those watching that Massachusetts’s mix of Medicaid expansions, sliding scale subsidies, private insurance reforms and individual mandate are working to expand coverage and have served as the template for national reform. 

But there are other, less obvious lessons from the Massachusetts experience that have not really filtered into the political and policy discourse in Washington.  Here are a few of the most important.

There are good policy and political reasons for putting coverage expansions ahead of cost containment

Massachusetts made the strategic decision to tackle health coverage before cost containment – making it easier to keep all players at the table.  Despite bold words to the contrary at the start of the process, the Congressional leadership and the Obama Administration too are finding it hard to arrive at a consensus on significant cost containment while still keeping the industry backers of coverage expansion at the table.  But Massachusetts is using the pressure from the cost of its coverage expansion to jump-start a more serious debate about cost containment than ever before.

Faster is better

The current health reform is not the first time Massachusetts attempted to enact a near-universal coverage program.  In the late 1980s under Governor and soon-to-be Presidential candidate Michael Dukakis, Massachusetts enacted a major health reform proposal with an employer “pay or play” as its central element along with a number of other smaller programs.  Today those smaller programs, implemented almost immediately after reform passed, are still going strong, while the employer pay or play, which was not scheduled to go into effect for several years after passage, was first delayed and then repealed as the political and economic environment shifted.

A strong exchange can yield important benefits

Massachusetts empowers its exchange (the Connector) to negotiate premium rates for the Commonwealth Care plans—the only plans that qualify for subsidies.  As a result, premium rates have risen only 5% per year on average; well below the general rate of growth of insurance premiums.  A rough estimate is that a similar provision in federal legislation could save $27 billion.

A kinder, gentler approach is the key to successful implementation and broad popular support

In general Massachusetts offers better benefits, better premiums subsidies, and has a gentler individual mandate than most are contemplating in Washington. With a bigger carrot and a smaller stick, Massachusetts has been able to expand coverage without significant adverse selection and maintained the broad support of all interest groups as well as the general public (75% according to the most recent survey).  While the federal government is unlikely to be able to match the benefits and premium subsidies provided in Massachusetts, a better balance of incentives to penalties is likely to help ensure the operational and political success of reform.

Comments

[Brian Rosman]

One other lesson we at MA Health Care For All would add is the critical role of making enrollment simple and easy, including supporting community-based outreach and enrollment.

Massachusetts quickly ramped up enrollment by using a simple application. Thousands of people who had applied for other programs were automatically transferred into the health reform program by using information already in the state's system.

A myriad of community groups got modest grants to explain the new requirements and enroll people into the program. We found this was critical particularly for people not fully comfortable in English. For those getting coverage for the first time, a trusted advisor from your community is very important.