Massachusetts Health Insurance Law

New Massachusetts Health Insurance Law - How will it affect me and my employees? By Cathy Chubbuck

In April 2006, Governor Mitt Romney signed into law the Massachusetts Health Insurance Reform Bill, which is slated to go into effect next year. There are several aspects of this law that both employers and employees need to be aware of, as it affects both individuals and their employers alike. Some of the highlights of this Law are listed below:

• All Massachusetts residents will be required to have Health Insurance coverage by July 1, 2007.
• All employers who employ ten (10) or more employees (full and/or part-time) will be required to either offer insurance to their employees, or to contribute up to $295 per year for each uninsured employee. The $295 a year is for a full time employee, contributions for part-time employees will be prorated based on hours worked.
• Policies will be tied to the employee, rather than the employer, making their plans portable from one employer to the next.
• If a part-time employee works for more than one employer, each employer will pay a proportionate cost.
• Those individuals and employers who do not comply will be faced with fines. For an individual, this will mean losing your personal tax exemption in 2008 when filing your Massachusetts tax return.
• Policies will be made available through the formation of “The Connector”, who will receive applications, and arrange for coverage through either insurance companies, or through Mass Health.
• Under Mass Health, subsidies will be available on a sliding scale for those individuals who are under 300% of the poverty level. For an individual, that would be anyone who earns less than $29,400.00 per year. For a family of four (4), their combined income must be less than $60,000.00 to apply for subsidies.
• There will be other changes to Mass Health, in that benefits such as dental and vision services that were cut in 2002 will be restored.
• There will be a new range of products for Young Adults between the ages of 19 - 26. For full-time students, they will be able to remain on their parents’ insurance an additional two years, until they reach twenty five (25).

The overall goal of this new law is to insure that everyone in the State of Massachusetts has access to affordable health care. The only other state at this point that has made similar plans is New Hampshire; the main difference is that their plan is a “voluntary” plan. In addition to other states and the federal government observing us as possible models for them to follow, there are a number of groups such as the AARP who are following this very closely, in order to give their members qualified opinions on the coverage being offered. There still are many challenges to overcome to implement this program fully, but supporters of the law think that this can be done in time to meet the deadline of July 1, 2007. We shall all be hearing much more on this in the coming months.

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