BAY STATE'S HEALTH CARE FUTURE

State government's potentially dire fiscal prospects, the specter of a national health reform bill that's still taking shape, and tens of thousands of job losses have clouded the progress of Massachusetts's landmark health care programs, as members of the board overseeing it wondered Thursday how their efforts would be affected and how they should proceed.

Massachusetts has seen hundreds of thousands of residents newly insured since the advent of a 2006 law mandating individuals to obtain health insurance and subsidizing coverage for low-income individuals - 97.4 percent of the state's 6 million residents are insured, according to the Patrick administration's latest tally. But a new state report shows that about 15,000 fewer people had health insurance in March than in December 2008, largely the result of losing their jobs, and therefore, their employer-sponsored coverage.

In addition, the removal of 31,000 legal immigrants from Commonwealth Care, a state-subsidized health insurance program for low-income residents, combined with changes to enrollment procedures, renegotiated insurance rates and generally shaky budget conditions have led members of the state Connector Board to question the effect on insurers who rely on enrollees steered to them by the state.

Four "managed care organizations" (MCOs) provide the bulk of coverage to low-income Massachusetts residents who don't receive insurance through their employer - BMC HealthNet Plan, Neighborhood Health Plan, Fallon Community Heaelth Plan and Network Health -- and a new entrant in the market, CeltiCare, is hoping to make inroads.

State leaders recently announced that most of the 31,000 immigrants removed from Commonwealth Care would be eligible for a special CeltiCare plan that provides coverage for most health services, except vision, dental, hospice and skilled nursing, and with some significant co-pay increases. The other MCOs have expressed dismay at CeltiCare's exclusive deal, with the Massachusetts Association of Health Plans arguing that the other four plans weren't given a fair chance to compete.

"I have very serious concerns about what this is doing to the margins and the service levels of the MCOs," said Ian Duncan, a member of the Connector Board.

Duncan, along with a handful of other board members, asked for a more thorough briefing about the "cumulative effect" of all the recent changes on the ability of MCOs to provide coverage.

The changes in service are playing out against a backdrop of questions about state government finances. Secretary of Administration and Finance Leslie Kirwan, who chairs the Connector board, said September revenue intake could have a significant impact on whether the administration seeks expanded powers to cut government budgets.

"Through the first two months of this year, we're just about on budget," she said. "That appears to be something that will be reversed in September."

As board members expressed dismay about the cuts to health benefits for legal immigrants, Kirwan emphasized that although their decisions are often made solely in the realm of health and human services, whose budget is constantly expanding, her job is to balance competing interests in programs across government, many of which have been scaled back and are facing severe cuts.

"We don't have information about what the impacts of all those choices would be," she said. "In a revenue decline, other parts of state government ... are declining in order to accommodate growth in health care and human services. We recognize why there is growth. We have more people depending on the commonwealth for programs. It does sort of mask the fact that there are bigger choices and in some cases much bigger budget cuts elsewhere ... If we're in this sort of pattern for a very long time, the challenge is going to be different than if we are in this for a short time."

The discussion also came as the Connector Board undergoes some of the most significant changes in its three-year history. Two members - Tom Dehner, who heads the one-million-member state Medicaid program, and Nonnie Burnes, the state insurance commissioner - are leaving their posts and will vacate their seats on the ten-member board.

Members of the board expressed renewed optimism that a national health plan would pass, offering a generally positive review of President Obama's speech to Congress Wednesday night. In his speech, Obama touted a proposal for a health insurance "exchange" that would help consumers shop for the most appropriate health plan for them, a program, not coincidentally, akin to the Connector. Connector Executive Director Jon Kingsdale said there had been discussions with the Obama administration about a Commonwealth Care member being recognized during his speech.

During testimony to the Committee on Election Laws Wednesday, Sen. John Kerry also emphasized the proposed health exchange, telling members of the Legislature that it's "your plan" that the Obama administration is pushing for national consideration.

Arguing for a change in state Senate succession laws to allow for an interim successor to Sen. Edward Kennedy, who passed away last month, Kerry said the absence of a second Massachusetts senator could lead to the demise of a national health plan.

"[Without a second vote] we don't build a health care system similar to what a vast majority of you here in this body voted for," he said. "The Connector ... we're going to build what's called an exchange that's based on the Connector. We're going to vote that everybody has to sign up. We're going to do it like you did."

Worrying that some iterations of a national health reform proposal could leave Massachusetts worse off, board member Nancy Turnbull wondered if the Connector could help influence the national reform debate to "create a protective bubble around ourselves."

Kirwan agreed, arguing, "We want to be helped for going first, not hurt. I think we need to keep that drumbeat."

"That may be a good reason to appoint a replacement for our senior senator," Kingsdale remarked, referring to the debate over a potential successor for Kennedy.

During the meeting, board members gave unanimous approval to emergency regulations, first adopted in June, permitting Connector staff to cancel auto-enrollment for the lowest-income members of Commonwealth Care, those earning below the federal poverty level. Auto-enrollment is a process that places those deemed eligible for Commonwealth Care into a health plan. By nixing auto-enrollment, the Connector, which over the years has sought to boost enrollment, hopes to curb the growth in enrollment, although members worried that it would lead to gaps in coverage.

Also Thursday, the U.S. Census Bureau released updated information about rates of insurance around the country, providing national context for the health reform debate.

In 2008, 46.3 million people around the country went without any health insurance, about 15 percent of an estimated 301 million U.S. residents. The total is up from 38.4 million people who went without insurance in 2000. Of the 255 million insured Americans, 176 million have employer-sponsored insurance and 87.4 million have a government-sponsored plan, according to the new data.

State-by-state numbers showed Massachusetts had a combined 5.4 percent uninsurance rate in 2007 and 2008, as the state's health reform plan took hold.

"We're about a third of the national average and the lowest in the country," said Brian Rosman, research director for Health Care for All, a Massachusetts consumer advocacy organization. Rosman noted the Massachusetts uninsurance rate dropped in the 2007-2008 time period by 4.4 percent compared to the previous two years, beating a national 2 percent drop in that time.

An August report by the state Division of Health Care Finance and Policy found that the ranks of privately insured dropped by 45,000 between December 2008 and March 2009, reflecting rising unemployment. The losses came as government programs, MassHealth and Commonwealth Care, grew by about 7,000 members. Overall, 5,484,000 Massachusetts residents were insured in March 2009.

Harvard Pilgrim Health Care saw the steepest enrollment decline since the advent of Massachusetts's landmark health plan, dropping by 46,000 members since June 2006, according to the DHCFP report. BMC HealthNet Plan grew by 89,000, the most of any plan in that interim, followed closely by the other three original Commonwealth Care MCOs.

Families USA, a national advocate for consumers, said the number of individuals uninsured nationwide exceeds the collective population of 24 states: Alaska, Arkansas, Connecticut, Delaware, Hawaii, Idaho, Iowa, Kansas, Maine, Mississippi, Montana, Nebraska, Nevada, New Hampshire, New Mexico, North Dakota, Oklahoma, Oregon, Rhode Island, South Dakota, Utah, Vermont, West Virginia, and Wyoming.

Opponents of national health reform plans argue that government involvement in health care will hinder care, place bureaucrats in charge of important medical decisions and limit coverage levels. President Obama has vowed that people who already have health insurance can keep it and maintain their current doctor; however their insurers would be forbidden from dropping them due to preexisting conditions or sudden serious illnesses.

A Rasmussen Reports poll out Wednesday found that 44 percent of Americans support Obama's plan while 53 percent oppose it.