I get asked this question a lot these days, which shouldn’t be that surprising. Harvard Pilgrim is headquartered in Massachusetts, and the Massachusetts health care reform plan is already a couple of years old. More importantly, it has added about 440,000 people to the insured ranks (185,000 through unsubsidized private plans and another 255,000 through subsidized, Medicaid-like coverage), has maintained high employer participation (over 70%) and doesn’t appear to be crowding out private coverage as public coverage expands.
But my answer to this question remains “it depends.” There were profound differences between Massachusetts and the rest of the country before health care reform took center stage here that make relying on our experience somewhat challenging for the nation as a whole. For example, Massachusetts already had guaranteed-issue requirements for individual health insurance coverage even before reform. Today, most states don’t. So in Massachusetts, individual coverage was available to anyone who wanted to buy it, but it was really, really expensive.
That’s because most of the people who buy individual coverage — absent a mandate to purchase — usually plan to use health care services once they purchase the insurance. Insurance works through risk pooling – a small number of people who get sick spend the premiums paid by a much larger group of people who don’t. If most of the people who buy the product plan to use it, there’s not enough healthy people to keep the overall price down.Continue reading…


