If you’re a proponent of universal health insurance, Massachusetts is the pioneer and model for health reform. Just about every resident in the state has coverage and health plans are readily accessible.
The only problem is that the state has the highest average insurance premiums in the United States. Health care spending is 27 percent higher in Massachusetts than the national average and costs keep growing.
The theory of the universal health insurance system, of course, is to bend the cost curve of health insurance. Yet in practice, the new Massachusetts system has resulted in annual 30 percent increases in the individual health insurance market.
The most surprising fact may be that the medical loss ratio in Massachusetts for individual policies is 112 percent — meaning insurance companies pay $1.12 in benefits for every $1 in premiums, wrote an opinion piece the Wall Street Journal. That means insurance companies are faced with the undesirable choice of passing that cost to consumers or going out of business.
On the flip side, insurance coverage in Massachusetts is generally much better than it is around the nation. For example, average insurance deductibles are 28 percent lower in Massachusetts than in the rest of the United States.
To help fight the seemingly out-of-control spending, Governor Deval Patrick wants to give state regulators the ability to cap rates of hospitals, physician groups and specialty providers.
But it very possibly may be a fruitless effort. in the 1970s and 1980s, 30 states tried doing the same thing with every state except Maryland rejecting the idea outright because it did not control health care costs.
So is Massachusetts a model of health care and health insurance reform success or massive failure? Certainly depends on how you look at it all.