By Nicole Cafarella, Tony Carrk | April 13, 2011
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The Affordable Care Act was signed into law one year ago. It is modeled in large part on the landmark Massachusetts health reform law enacted four years earlier in 2006. Opponents of the Affordable Care Act often attack it by distorting the facts about the Massachusetts experience. They selectively alternate between snapshots of and trends in Massachusetts and comparisons between Massachusetts and the United States.
The most appropriate way to assess the impact of the Massachusetts law is to compare changes over time in things like health coverage and premium costs in Massachusetts to changes over time in the United States as a whole. We use that approach below to debunk many of the myths opponents propagate regarding Massachusetts’s experience with health care reform.
Massachusetts increased health coverage while coverage declined in the rest of the country.
Myth
The Massachusetts law failed to significantly reduce the ranks of the uninsured in the state.
Fact
The Massachusetts health reform law dramatically increased the insurance rate in the state over a period when the national health coverage rate declined. As of the end of 2010, 98.1 percent of the state’s residents were insured compared to 87.5 percent in 2006 when the law was enacted. Almost all children in the state were insured in 2010 (99.8 percent). In comparison, at the national level the health insurance rate dropped from 85.2 percent in 2006 to 84.6 percent in 2010.
Employers continued the same level of health coverage in Massachusetts while dropping people in the rest of the country.
Myth
The Massachusetts health reform law is eroding employer-sponsored health insurance.
Fact
The number of people in Massachusetts with employer-sponsored health insurance has not dipped below 2006 levels since passage of the health reform law. Approximately 4.3 million people in Massachusetts obtained health insurance through their employer in 2006. This figure increased to 4.5 million in 2008 before returning to 2006 levels in 2010. In comparison, the number of nonelderly people in the United States with employer-sponsored health coverage declined from 161.7 million in 2006 to 156.1 million in 2009.
Since passage of Massachusetts’s health reform law, a larger share of the state’s employers have offered health insurance to their workers when compared to the United States as a whole. At the national level only 60 percent of employers offered health coverage to their employees in 2005. This is significantly lower than Massachusetts’s rate of 70 percent at that time. The Massachusetts rate increased to 76 percent in 2009, which is 7 percentage points higher than the national figure for 2010.
People buying insurance on their own in Massachusetts are paying lower premiums. Premiums in the nongroup market have increased in the rest of the country.
Myth
Massachusetts residents are paying higher premiums in the nongroup market as a result of the health reform law.
Fact
Nongroup health insurance premiums in Massachusetts have fallen by as much as 40 percent since 2006 because health reform brought healthy people into the insurance market. In contrast, at the national level nongroup premiums have risen 14 percent over that period of time.
More than 98 percent of Bay Staters met the law’s individual insurance requirement.
Myth
A significant portion of Massachusetts residents are ignoring the mandate and only purchasing health insurance when they need care.
Fact
The size of Massachusetts’s individual market more than doubled after passage of the health reform law. This boost and the accompanying drop in the average cost of individual premiums were due in part to more healthy—and previously uninsured—individuals entering the market. Only 1.3 percent of the state’s 4 million tax filers who were required to and did report their coverage status were assessed a penalty for lacking coverage in 2008, the last year for which complete data are available. About 26,000 of these 56,000 people were actually in compliance for part of the year.
For more facts about Health Care Reform in Massachusetts, click here.
Nicole Cafarella is the Payment Reform Project Manager and Policy Analyst, and Tony Carrk is a Policy Analyst for American Progress.
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