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Presentation: Health Reform in Massachusetts

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This is a slideshow presentation that looks at the outcomes of the 2006 Massachusetts health reform law. These are major findings related to insurance coverage, access to care, costs, emergency room …

This is a slideshow presentation that looks at the outcomes of the 2006 Massachusetts health reform law. These are major findings related to insurance coverage, access to care, costs, emergency room use, and other select outcomes from the more comprehensive report by Mass-Care and Massachusetts PNHP: "Massachusetts Health Reform in Practice, and the Future of National Health Reform."

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  • 1. The Massachusetts Model of Health Reform in Practice And the Future of National Health Reformhttp://masscare.org/massachusetts-health-reform-in-practice/
  • 2. Massachusetts Health Reform (“Chapter 58”) April 12, 2006Patient Protection and Affordable Care Act Presidential Elections March 23, 2010 November, 2012
  • 3. Origins of Mass. Health Reform• 2006 expiration of Massachusetts Medicaid Waiver (Section 1115).• Bush Administration opposition to state’s ‘Free Care Pool’ payments: culture of insurance.• Two binding ballot initiatives for ’06 election. The ‘Free Care Pool’• Hospital & health center reimbursement for care of uninsured, 0 to 200% of poverty line.• 452,000 users in FY2006 (659K uninsured).• $710 million in FY2006 (Medicaid: $10 bill).• Covers all services available at hospitals, health centers, no cost-sharing, not considered insurance.
  • 4. Structure of Mass. Health Reform• Commonwealth Care: free subsidized insurance from 0 to 150% of poverty; sliding subsidies from 150% to 300% of poverty.• Commonwealth Choice: ‘exchange’ for individual and eventually small business market (40K users currently).• Individual Mandate: adults above 150% of poverty must demonstrate insurance coverage or pay a fine ($200 to $1,200) on tax forms.• Employer Play-or-Pay: with 11+ employees, must cover 1/4th of employees and offer to cover 1/3rd of premium costs, or pay $295/per worker per year fine.• No New Revenue: financed from existing free care pool funds, federal matching funds, private payments, and limited cash from state’s General Fund.• No Cost Control: limited to access for political reasons.
  • 5. Impact on the Uninsured12% 11.3% 10.4%10% 10.3% Health 9.3% Reform 9.2% 8.5%8% Census/ACS 7.4% 6.2% Census/CPS 5.6%6% 6.4% 5.5% 5.3% State/CSR 5.7% 5.4% 4.4% 4.4% 4.4% State/Urban Inst4% 4.2% 4.3% 4.1% CDC/BRFSS**2% 2.6% 2.7% 1.9%0% 2004 2005 2006 2007 2008 2009 2010
  • 6. Notes on the Uninsured• Most commonly cited estimates are impossibly low: state survey finds less than 144,000 uninsured in fall 2008, but 150,000 report they are uninsured for whole year on tax returns.• Most reliable surveys show uninsured population cut in half, around 4-5% of pop.• State reports that 4/5ths of the newly insured received public subsidies – majority of these were eligible for free care prior to reform.
  • 7. Impact on the Employer- Sponsored Coverage80% 77% 76%75% 72% 70% 69%70% 68%65%67% 63% 63%60% 60%55% 57% 54%50% 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 % of Employers Offering Workplace Coverage % of Employees Buying Workplace Coverage
  • 8. Impact on Employer Coverage of Low-Income Residents70.0% 59.4%60.0% 55.6% 54.2%50.0% 46.1% 42.4%40.0%30.0% 26.2% 25.3% 21.8% 20.9%20.0% 17.2%10.0% 0.0% 2005 2006 2007 2008 2009 Employer-Sponsored Insurance Public Insurance
  • 9. Access to Regular Source of Care Improved Massachusetts Residents, Ages 18-64, Reporting a Regular Source of Care, Three Sources of Data94.0% 92.1%92.0% 91.0% 89.9%90.0% 89.0% 90.0% 88.0%88.0% 87.0% 88.3% 87.8% 87.7%86.0% 86.3% 85.4%84.0%82.0% 2005 2006 2007 2008 2009 2010 BRFSS Blue Cross/Urban Inst State/Urban Inst
  • 10. Cost Barriers to Care Declined Massachusetts Residents, Ages 18-64, Didn’t Receive Needed Care Due to Costs, Three Sources of Data35.0% 29.0%30.0% 27.0% 26.0%25.0%20.0% 16.3%15.0% 11.6% 11.7%10.0% 9.9% 8.6% 7.8% 7.9% 7.6% 5.0% 6.9% 0.0% 2005 2006 2007 2008 2009 2010 BRFSS Blue Cross/Urban Inst State/Urban Inst
  • 11. From Safety Net Care to Publicly- Subsidized Private Insurance Co-Payments by Safety Net Plan Free Care Pool Commonwealth Care (2011)Income Eligibility 0-200% 0-100% 100-200% 200-300% poverty poverty poverty povertyAnnual Premium $924 -(for lowest cost plans) $0 $0 $0 - $468 $1,392Primary Care Visit $0 $0 $10 $15Specialist Visit $0 $0 $18 $22Inpatient Care $0 $0 $50 $250Outpatient Surgery $0 $0 $50 $125Emergency Room Visit $0 $0 $50 $100Generic Drugs $1-3 $1-3 $10 $12.50Preferred Brand Drugs $3 $3 $20 $25Non-Preferred Brand Drugs $3 $3 $40 $50Maximum Prescription Co-Pays $200 $200 $500 $800Maximum Other Co-Pays $0 $0 $750 $1,500
  • 12. Patient Story on Mixed Access Impact“Under Free Care I saw doctors at Mass General andBrigham and Women’s hospital. I had no co-payments for medications, appointments, lab tests orhospitalization; the care I received gave me a light atthe end of the health care nightmare tunnel...Undermy Commonwealth Care plan my routine monthlymedical costs included the $110 premium, $200 formedications, a $10 appointment with my primarycare doctor, and $20 for a specialist appointment.That’s $340 per month, provided I stayed well.” Kathryn, Boston MA (2008)
  • 13. Primary Care Wait Times Rise With Increased Demand Average Wait Time for New Patient Appointment 55 53 52 50 50 47 45 48 44Days 40 35 30 33 25 2005 2006 2007 2008 2009 2010 2011 Internal Medicine Trendline
  • 14. Decline in Primary Care Practices Accepting New Patients Percentage of Practices Accepting New Patients70% 66% 64%65%60% 58%55% 51% 49%50% 51%45% 44%40% 2005 2006 2007 2008 2009 2010 2011 Internal Medicine Trendline
  • 15. Underinsurance Rises: Primarily at Small EmployersPrivate Insurance Plans with Share of Medical Costs Covered by SmallHigh-Deductibles ($1,000+) Business Employees’ Insurance, 2007-200912.0% 100% 8% 11.3% 90% 34% 15%10.0% 80% 70% 28% 60% 8.0% 50% 6.1% 46% 40% 6.0% 30% 50% 20% 4.0% 3.4% 16% 10% 0% 5% 2.0% 0.0% 2006 2007 2008 ≤ 70% 70.1% - 80% 80.1% - 90% 90.1% - 100%
  • 16. Out-of-Pocket Barriers Decline Change in % of Families with High Out-of-Pocket Spending25% 21.8%20% 18.4% 18.0%15%10% 9.4%5% 7.3% 6.7%0% 2006 2007 2008 2009 Out-of-pocket costs 5% of income or more Out-of-pocket costs 10% of income or more
  • 17. Impact on Total Household Spending on Health Care Change in Percentage of Families with High Total Health Spending25% 20.2%20%15% 14.2%10% 5.2%5% 3.6%0% Spent 10%+ of income on health care Spent 25%+ of income on health care 2000 2009
  • 18. Impact on Medical Debt and Medical Bankruptcies70% 59.3%60% 52.9%50%40%30% 19.1% 19.1% 19.5% 20.3%20%10%0% Problems paying medical bills Paying medical bills over time Bankruptcies related to illness/medical bills* 2006/07 2009
  • 19. Emergency Department Use Trends in Emergency Department Use (Indexed to 2004)115 113113 111111109 107107 109105 107 102103 100 104101 99 101 97 95 2004 2005 2006 2007 2008 Preventable/Avoidable ED visits Total ED visits
  • 20. Financial Crisis for Safety Net• Contrary to expectations, patient volume at safety net providers has gone up since health reform: – 31% growth in patients receiving care at community health centers – Ambulatory visits to safety net hospital clinics grew at 2X the rate of visits to non-safety net hospital clinics• Reimbursement rates at safety net hospitals are down. Promised Medicaid rate increases reversed through budget cuts and health safety net funds falling short, creating a serious financial crisis. – Unsuccessful lawsuit by Boston Medical Center and six community hospitals for Medicaid underpayments in 2009. – “Soft landing” funds for two largest safety net hospitals run out in 2010. – Cambridge Health Alliance forced to close six clinics and shut down all inpatient services at one of its hospitals, seeking a buyer or a merger.
  • 21. Rise in Premiums Has Accelerated,Growth in Provider Administration • Employer premium growth accelerated in Massachusetts after health reform compared to other states: – For single coverage: premium growth was 5.9% higher in three years after reform for all employers, 6.8% higher for small employers – For family coverage: average annual premium growth was premium growth was 1.5% higher in three years after reform for all employers, 14.4% higher for small employers • Small employer premiums due in part to merger of individual and small group markets in Mass. • Job growth in Mass. health care industry almost double that of nation after reform, slower than nation prior to reform. Almost all of difference accounted for by growth in administrative occupations in Massachusetts, which grew by 18.4% over three years (compared to 8.0% nationally).
  • 22. Concept of “Shared Responsibility”“Massachusetts mandated shared responsibility… The costs of expanding coverage to all are considerable… the only way to ensure the sustainability of that expense over the long term is through universal responsibility, spreading the cost broadly among all sectors of society: individuals, government, and employers.” Bruce Bodaken President and CEO, Blue Shield of California
  • 23. Measuring Shared Responsibility Change in Health Care Spending by Payer, Before and After Reform, 2005-200730% 28% 25%25% 21% 22%20%15%10% 5% 0% Employers and Union Individuals State Government Federal Government Plans
  • 24. Measuring Shared Responsibility Change in Health Care Spending by Payer, Before and After Reform, 2005-2007 30% 28% 25% 25% 21% 22% 20% 15% 10% 5% 0% Employers and Union Individuals State Government Federal Government Plans Increase in Health Care Spending After Reform as a Percentage of Family Income, by Income Quintiles, 2005-2007 5% 4.6%as Percentage of HouseholdIncearse in Health Spending 4% 3% 2% 1.7% 1.4% 0.4% Income 1% 0% -1% -2% -1.5% Bottom 20% Second 20% Middle 20% Fourth 20% Top 20% ($0 - $20k) ($20k - $41k) ($41k - $66k) ($66k - $111k) ($111k+) Income Quintiles: Bottom to Top 20% of Income Earners
  • 25. Mass. Health Reform Has Had Positive Impacts, But Is Unsustainable“If we have double-digit increases (annually in costs), health reform is not sustainable.” Jon Kingsdale Executive Director, Commonwealth Connector“If we do not constrain healthcare costs, the system we worked so hard to create and implement will collapse..” Therese Murray Senate President, Massachusetts Legislature
  • 26. 20% 40% 60% 0% CommCare Enrollment 100000 120000 140000 160000 180000 200000 0 20000 60000 80000 0% Q2 07 Nov 06 5% 40000 3,654 Dec 06 8% Q3 07 Jan 07 Feb 07 Mar 07 Q4 07 25% Apr 07 May 07 Jun 07 Q1 08 20% Jul 07 Aug 07 Sep 07 Q2 08 23% Oct 07 Nov 07 Dec 07 Q3 08 28% Jan 08 5% Feb 08 177,136 Mar 08 Q4 08 29% Apr 08 May 08 Q1 09 33% Jun 08 Jul 08 Aug 08 Q2 09 32% Sep 08 Oct 08Commonwealth Care Enrollment Nov 08 Q3 09 31% Dec 08 Jan 09 Feb 09 Q4 09 31% Mar 09 Apr 09 May 09 Q1 10 43% Jun 09 Jul 09 Aug 09 178,686 Q2 10 42% Share of Commonwealth Care Enrollees Paying Premiums Sep 09 Oct 09% Unemployed Nov 09 Q3 10 42% Dec 09 Jan 10 Feb 10 Commonwealth Care Enrollment and Mass. Unemployment Rate 152,571 Q4 10 9% 42% Mar 10 0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% Q1 11 50% Back Coverage to Control Costs Massachusetts State Has Been Gradually Rolling Q2 11 49% Unemployment
  • 27. Individual Mandate AlsoUnsustainable, Mass. Has Raised Affordability Thresholds Percent of Income Deemed Affordable for Health Premiums (Families of Three, 2007-2011)12.0% 11.0%10.0% 9.5% 8.0% 8.0% 7.5% 7.0% 5.9% 6.0% 6.0% 5.6% 4.9% 5.0% 2007 2011 4.0% 3.3% 3.4% 2.0% 0.0% 151% of 201% of 251% of 301% of 401% of 500% of Poverty Poverty Poverty Poverty Poverty Poverty
  • 28. Takeaway Points for National Health Reform (PPACA)1. Mass. reform affected the insurance status of about 4-5% of the population (half the previously uninsured), and improved access for about half of those. The impact in other states will vary depending on their existing safety net programs, but focus on access outcomes – not insurance coverage!2. National reform is unlikely to have a significant impact on outcomes that predominantly afflict the insured population, including emergency department visits, medical debt, and health-related bankruptcy.3. While safety net providers handle most of the increased demand for care that results from reform, Massachusetts and national reform rely on cuts to public health care programs that can threaten the viability of those providers. This increased demand will also increase strain on primary care provider networks.4. Most of the population will be relatively unaffected by health reform, but will continue to experience the health care crisis of unaffordable premiums and high barriers to care. (They also vote!)5. This model of reform defers serious action on cost control. Without addressing the systemic causes of our high costs – which has thus far proven politically impossible – access gains will face retrenchment, or will force us to sacrifice spending on other basic social goods.

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