Closing in on health reform’s two year anniversary, some things are worth remembering. Many observers saw that the financing plan to sustain Chapter 58 over the medium and long haul was deficient. We saw it, and commented that the time would come when we would have to revisit the law’s financing structure.
We predicted the most likely time for the reckoning – spring 2008. For two reasons: first, the second contract period for Commonwealth Care would significantly raise the cost of covering CommCare enrollees; and second, renewal of the federal 1115 Medicaid waiver carries significant risks for the state’s financial exposure. On these two, the first shoe has dropped, and the second not yet.
We did not see the robust enrollment in CommCare, the major factor that has pushed costs beyond most expectations.
Right now, the cost of CommCare is being borne exclusively by taxpayers (state and federal) and by enrollee premiums and copays. Two years ago, the legislative crafters of Chapter 58 estimated CommCare costs at $750 million in FY09; in January, the Patrick Administration’s budget estimated FY09 costs at $869M. Now, according to Alice Dembner’s Globe article today, that may be as much as $100M short.
The cost of CommCare cannot be sustained by taxpayers and enrollees. It won’t work.
Are we in a financing crisis? A crisis is when your back’s to the wall and there are no acceptable alternatives. That’s not the case here. It’s reasonable and fair to ask insurers to bear some of these costs, especially when – by their own recent calculations – health reform has delivered them 111,000 new customers over the past year. It’s also reasonable and fair to ask some providers to sustain this important advance.
Business? Two propositions. First, it’s not fair to ask employers who are covering their workers to pay more. They are already paying their fair share. And it’s fair to ask employers whose workers are not covered, and especially employers whose workers are relying on CommCare for coverage, to pay part of the cost, in addition to taxpayers and enrollees.
This is not a crisis. Not yet.