Tuesday, July 29, 2008

The Emperor Has no Clothes 

The WSJ provides some clear thinking on Massachusetts

By Marc Kilmer

Filed As:  Health Care

In an editorial today, the Wall Street Journal illustrates why those who think that Massachusetts health care plan is going well are just plain wrong:

Supporters are exultant because 350,000 people are newly covered since former Governor Romney's parley with Beacon Hill Democrats in 2006; this cuts the state's uninsured rate by about half. That's not the promised "universal" system, but never mind. The ominous news is that only about 18,000 people -- or 5% of the newly insured -- have taken advantage of the "connector," which was supposed to be the plan's free-market innovation linking individuals to private insurers.

Most of this growth in coverage has instead come via a new state entitlement called Commonwealth Care. This provides subsidized insurance to those under 300% of the poverty level, or about $63,000 for a family of four. About 174,000 have joined this low- or no-cost program, a trend that is likely to speed up.

As this public option gets overwhelmed, budget gaskets are blowing everywhere. Mr. Patrick had already bumped up this year's spending to $869 million, $144 million over its original estimate. Liberals duly noted that these tax hikes are necessary because enrollment in Commonwealth Care is much higher than anticipated. But of course more people will have coverage if government gives it to them for free. The problem is that someone has to pay for it.

Thus the extra tab of $129 million, which may need to go higher because it relies on uncertain federal funds from Medicaid. For now, Mr. Patrick wants one-time (yeah, right) charges of $33 million on insurers and $28 million on providers, plus some shuffling of state funds. The balance comes from an estimated $33 million boost in the state's "pay or play" tax: If businesses don't offer "fair and reasonable" insurance to their employees, they get hit.

It's unfortunate for taxpayers in other states that their political leaders are looking to Massachusetts as some kind of model to emulate.

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