Why is Massachusetts health insurance so expensive?
Jay Parkinson asserted,
Massachusetts has been a failure because they mandated insurance without mandating, at the same time, changing how healthcare is delivered.
I think he is wrong. Or, more specifically, I don’t think he has the data to back up the claim. He is responding to a Boston Globe article, which reports that Massachusetts has the most expensive family health insurance in the country. First off, calling Masachussetts a “failure” is a bit … premature. In what manner has it failed? Sure, it’s had budget problems—but so have most states. It also has the lowest rate of uninsured anywhere in the country. That’s a plus. Wait times for a routine check-up are up incredibly high—though any business that has recently seen a dramatic increase in customers is likely to have some lines initially. (Arguing that we can’t give medical treatment to sick people because we might have to wait in line has always seemed a bit reprehensible to me.) On the upside, Massachussets’ emergency rooms have not seen a dramatic increase in wait times and are toward the middle nationally. (Though Boston ER rooms are toward the top in terms of patient satisfaction.) But Jay is not talking about the quality of medical care—he is talking about the price of health insurance. And he blames the price for Massachussetts mandates. Does the cited article really support that conclusion? We could try reading it:
The report by the Commonwealth Fund, a nonprofit health care foundation, showed that the average family premium for plans offered by employers in Massachusetts was $13,788 in 2008, 40 percent higher than in 2003. Over the same period, premiums nationwide rose an average of 33 percent.
The report did not break out how much premiums have increased in Massachusetts since the 2006 changes went into effect, so it does not show whether the law affected the rate of price increases.
Massachussetts premiums increased faster than the rest of the country—though that wasn’t necessarily caused by the health plan. (Some portion of the increase could also be prompted by sick people moving to or declining to move out of a state that takes care of its uninsured.) The mandate (as much as I dislike it) is not the primary reason Massachussetts’ health insurance is so expensive. On the other hand, the expensive health insurance may be what prompted Massachussetts to try to do something to get costs under control. It hasn’t succeeded yet, but they are still working on it.
