More Good News from Massachusetts

Today’s Managing Health Care Costs Indicator is $453 Million

The blogosphere has focused a lot of attention on Massachusetts, where almost everyone (97+%) has health insurance as a result of health care reform that looks almost exactly like the Affordable Care Act.  Our costs in this state are exceptionally high – although they are rising more slowly than costs in other states.

A study released last week by the Massachusetts Taxpayer Foundation  – a nonpartisan group that advocates for good government (including promoting prudence in spending) – shows that it cost the state an additional $453 million, or  an incremental $91 million on the average for each of the last five years to extend coverage to another 7.6% of the population.   The total cost was a bit over $900 million –the additional amount was spent by the federal government for Medicaid and waivers,  employers who increased the portion of the population insured during this time period despite the recession, and individuals who purchased insurance and who would have otherwise gone “naked.”

It’s not perfect for states to go this alone.  Massachusetts hospitals on the New Hampshire border are already seeing higher rates of bad debt due to the difficulty of obtaining affordable insurance to the north.

And the total dollars being spent are not inconsequential.    However, incremental spending to support expanded coverage is equivalent to 1.4% of the total state budget. Seems like a good deal.