Massachusetts has an opportunity to protect health insurance coverage and make health care more affordable, accessible and equitable for individuals and families across the state. The House of Representatives voted to enhance the state’s successful ConnectorCare program in its 2024 budget. This proposal would lower copays, deductibles and premiums that continue to squeeze Massachusetts families and put care out of reach for too many.
The two-year pilot program would expand eligibility for the state’s subsidized health insurance program, ConnectorCare. Individuals and families earning up to 500 percent of the federal poverty level (approximately $73,000 a year for an individual) would become eligible for insurance with reduced premiums and minimal out-of-pocket costs under the pilot. It is estimated that 47,000 to 70,000 Massachusetts residents would be newly eligible for more affordable coverage. The pilot program would be fully funded by leveraging state savings from enhanced federal subsidies passed by Congress that are accruing to the state’s Commonwealth Care Trust Fund, which was established to support affordable care. It would not require any additional state funding.
The proposal is especially timely as more than 2 million individuals will go through a redetermination process, and many may lose their MassHealth coverage as the federal public health emergency comes to an end. Fortunately, many individuals will become eligible for ConnectorCare, and this pilot program will help ease transitions and provide direct relief to those facing the growing challenge of affording the care they need. More than 40 percent of residents report challenges affording care. At a time of rising costs across the board, out-of-pocket health care costs force too many people to avoid needed care and treatment including doctor’s visits and prescription medications. It is also fundamentally an issue of health equity with Black and Hispanic/Latinx residents more likely to report challenges accessing care due to cost, and those disparities most are acute for those above the current eligibility limit for ConnectorCare.
A false and inaccurate concern has been raised that the proposed pilot would negatively impact small employer coverage and insurance premiums. The suggestion that employees could choose this new option over employer insurance is inaccurate because ConnectorCare is only available to employees who are not offered a minimum standard of employer coverage (covering 60% of costs with premiums that are no more than 9% of the employee’s income). The pilot will not incentivize employees to choose subsidized coverage because they simply aren’t allowed to unless their employer no longer provides an affordable coverage option for them. Most of the people who will benefit from this proposal are already purchasing insurance on their own or they are among those who are expected to lose MassHealth coverage during the current redetermination process.
Additionally, the suggestion that increased enrollment in the ConnectorCare program would raise premiums for small businesses is incorrect, and in fact, any additional enrollment in the ConnectorCare program is likely to stabilize costs for small employers based on the analysis of the Merged Market Advisory Council. The merged market contains three groups of insured individuals – small businesses, ConnectorCare recipients and individuals who purchase unsubsidized insurance on their own. The merged market spreads the risk for health insurance coverage across these three groups. An analysis for the Merged Market Advisory Council found that the costs of ConnectorCare members were roughly the same as those in small employer plans, and both of these groups were less expensive than those with unsubsidized insurance. ConnectorCare plans are less expensive, in part, because the vast majority of them have more limited networks, which are more affordable for individuals with modest incomes. Even as eligibility for these plans expands through the pilot to individuals slightly higher up the income scale, they are still more likely to purchase the less expensive, narrower network plans, given that they are by far the more affordable option.
Finally, analyses conducted of both Massachusetts’ 2006 health reform and of the Affordable Care Act found that despite claims that subsidized coverage would “crowd-out” employer coverage, this turned out to not be the case. These expansions in coverage showed no negative impact on employer coverage.
There is important work to do to address rising health insurance costs for small businesses, including building on successes in improving the health insurance rate review process and addressing underlying drivers of health care costs from prescription drugs to high-cost hospitals. We are excited to work with a wide range of stakeholders in this effort. However, blocking more affordable coverage for more people without employer insurance won’t help small businesses or the people left with high costs.
Massachusetts has the opportunity to meet the moment by supporting residents during the MassHealth redetermination process and to address the rising challenge of affording care for those without employer insurance. It has never been more important to tackle these affordability concerns. Massachusetts has a history of showing we can come together to get important reforms done that help everyone, and the pilot program to expand ConnectorCare is one of these important reforms.
Alex Sheff is Director of Policy & Government Relations at Health Care For All.
