Reaching the Goal: Expanding Health Insurance Coverage in New England Current Strategies and New Initiatives
As the number and percentage of people without health insurance continues to climb, the goal of expanding such coverage is even more pressing. Traditional strategies have had only limited success. And with little movement at the federal level, states have chosen to enact their own bold initiatives. Four New England states - Maine, Massachusetts, Rhode Island, and Vermont - have recently passed or implemented programs to expand health insurance coverage, some with the goal of achieving near-universal coverage. By combining different strategies from across the political spectrum, the new initiatives represent a unique amalgam approach to expanding health care coverage. This paper examines existing strategies that have taken a more incremental approach to expanding coverage and also explores the new initiatives in New England, comparing and contrasting their designs and strategies.
Over the past decade or so, states have had varying degrees of success in pursuing a number of traditional strategies, often in combination, to achieve incremental reductions in the rate of uninsured. Policies targeting the low-income population, such as Medicaid and SCHIP expansions, have been modestly successful in expanding coverage at a fairly low cost. Yet efforts to address the high-risk population and policies to expand coverage in the individual and small group markets have had limited success.
In contrast to previous efforts to expand coverage, the new insurance initiatives in New England emphasize "shared responsibility," placing the onus for coverage on government, employers, and individuals alike. Several of the plans provide public subsidies to ensure affordability for low-income residents. Two states also impose financial penalties on employers that do not offer health insurance coverage. To encourage individual participation, most of the plans offer fairly comprehensive coverage, with relatively limited cost sharing. Massachusetts has gone further, mandating that individuals purchase coverage, either from the state, through their employer, or in the private market.
Yet, the New England states face various pitfalls as they expand coverage. For example, in setting subsidies for individual premiums, policymakers must balance the need to make coverage affordable with the desire to minimize the potential for disruption in the group insurance market. Another challenge is to maintain minimum benefits standards while negotiating premium discounts with insurers, a task that may prove difficult in the future if the new programs are unable to attract a sufficiently large share of the market. Finally, many of the new programs rely on cooperation between states and insurers, which can be difficult to sustain over time, especially in states with few players in the private market.