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Governor Sends Back Employer Assessment; Seeks MassHealth Reforms

Posted on July 17, 2017

Governor Charles D. Baker returned to the Legislature today the employer health-care assessment portion of the Fiscal Year 2018 budget, along with provisions changing Unemployment Insurance rates for 2018 and 2019, and urged legislators to include long-term reforms that will put the MassHealth program on a firm financial footing.

Health.Energy.jpgThe governor is also filing separate legislation making reforms to the commercial health-insurance market.

“The governor’s actions provide the Legislature with the opportunity to review and vet the reforms, and to pass a thoughtful, comprehensive package that balances investments made by all stakeholders in the Massachusetts healthcare system,” said Richard C. Lord, President and Chief Executive Officer of Associated Industries of Massachusetts.

The employer assessment would raise $200 million annually through the Employer Medical Assistance Contribution (EMAC) and fall most heavily on companies where employees use MassHealth instead of an employer health plan. The assessment would be offset by a two-year Unemployment Insurance rate adjustment that would save employers $335 million over two years versus current rates.

The administration hammered out the MassHealth reforms during months of negotiations with AIM and other members of the business community. The proposed reforms include:

  • Restructuring MassHealth coverage for non-disabled adults to look like commercial insurance coverage;
  • Moving 140,000 people with income above 100% of the federal poverty level out of MassHealth and into ConnectorCare;
  • Shifting 230,000 MassHealth members from standard MassHealth coverage, which includes coverage for long-term care, into CarePlus, which does not;
  • Requiring the commonwealth to petition the federal government to re-establish the prohibition against employees who are offered employer-sponsored insurance from seeking coverage through MassHealth.

The Baker Administration’s decision to file stand-alone legislation addressing commercial health insurance reforms acknowledges the need for comprehensive reform of our private healthcare systems. As employers are faced with the second most expensive health-care costs in the nation, the need for reform and cost containment is vital to maintain both the quality of care and the level of coverage across our commonwealth.

AIM looks forward to the Legislature’s consideration of these challenging topics and their willingness to engage with a broad coalition of partners across our health-care system to attain an equitable resolution.