Massachusetts Officials To Reduce Cost Of Health Insurance Law

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Massachusettsofficials are seeking ways to address the increasing costs of the state'shealth insurance law as "the state faces a recession and pivotal fundingdecisions that could make or break health reform," the BostonGlobereports. The state faces a $1.3 billion budget shortfall, with the healthinsurance initiative facing about a $100 million shortfall.

According to the Globe, lawmakers could address the $100 milliongap "quickly if the state approves an increase in the cigarette tax"and uses the money for health care, as proposed by state House SpeakerSalvatore DiMasi (D). A $1-per-pack increase in the cigarette tax couldgenerate $152 million a year. A "larger issue" will be securing a newthree-year commitment from the federal government, which provides about half ofthe funds for the state's subsidized insurance program Commonwealth Care, the Globe reports. Massachusetts is seeking$1.5 billion over three years in federal matching funds, but the "Bushadministration has been cutting back federal payments to the states,"according to the Globe.

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Even if the state can obtain enough funding from the tax increase and federalgovernment, the law's "future rests on slowing the growth of health carecosts in general, a task many analysts say is far more challenging than shapingthe complex health reform law in the first place," the Globereports.

Leslie Kirwan, the state's top budget official, last week said the financialsituation might require additional contributions from a coalition of insurers,businesses, hospitals and consumer advocates that worked to pass the law. Sheadded that the state also might have to revisit "some of the original assumptionsof health care reform." State Senate President Therese Murray (D) alsosuggested that the state review provisions of the law as part of a "lookat everything," but DiMasi said he believed it was too soon to revise thelaw. Meanwhile, advocates are calling on Gov. Deval Patrick's (D)administration to require additional contributions from businesses.

A council established by the health insurance law has developed proposals toreduce spending growth, and lawmakers are considering several bills, but the"task is daunting," the Globe reports. Commonwealth Health Insurance Connector Director Jon Kingsdale said,"If we don't grapple seriously with the cost of health care, the supportfor reform will erode and the perception will become broader that it isunaffordable" (Dembner, Boston Globe, 3/26).

Reprintedwith permission from kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, and sign upfor email delivery at kaisernetwork.org/email . The Kaiser Daily Health PolicyReport is published for kaisernetwork.org, a free service of The Henry J.Kaiser Family Foundation.

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