Connector / Insurers Struggle Providing Affordable Plans

January 22, 2007

The Commonwealth Connector, the authority charged with introducing health insurance plans affordable to about 160,000 uninsured individuals, indicated that plans submitted to date that meet minimum coverage standards are too expensive. The plans are targeted for individuals who are not eligible for publicly subsidized insurance programs that have been rolled out in recent months in accordance with last April's universal health care law.

According to Bob Carey, director of planning and development at the Connector Authority, monthly premiums from submitted plans that met the state's minimum coverage requirements would cost $380, on average. Submitted premiums ranged from $250 for a 28-year-old to $580 for a 56-year-old. The average rate is about $100 higher than what board members had initially expected to be.

The news sent members of the Connector Authority board back to the drawing table. Board members said they will recommend today that lower insurance policy standards be put out for public hearings. The Connector Board had requested proposals from insurance companies that would deliver 60 percent of the benefits of top-notch insurance plans and, based on the results, discovered the cost of such plans would far exceed the ability of individuals to pay, leaving them vulnerable to bankruptcy when the state's insurance mandate kicks in on July 1.

"Our job is to protect people from bankruptcy," said board member Jonathan Gruber, who said he did not want to be "too prescriptive" when defining the regulations. He favored limiting the regulations by capping maximum out-of-pocket costs and deductibles only. Another board member said the panel needs to stay focused on insurance coverage and quality. "This is not about affordability, this is about what kind of plan we can call a health insurance," said member Dolores Mitchell. "I may not like it." Butler said the Connector regulations should not lose sight of the affordability, financial protection and quality of care for individuals. At the end, the committee agreed to recommend to the full board on Monday to cap the out-of-pocket maximum to $5,000 for individuals and $7,500 for families, cap the deductible to $2,000 for individuals and $4,000 for families and have prescribed drugs count toward the out-of-pocket maximum. Other recommendations included coverage of brand name drugs only and coverage for some doctor visits.

Today, the Connector is scheduled to vote on the draft regulations for minimum coverage on Monday. The regulations will then go before a public hearing on Feb. 16 and a final vote is scheduled to take place on March 8.

"I'm getting a little nervous . . . to come up with choices, I mean we're not experts," said Executive Director Jon Kingsdale, adding providers may not be able to meet all the requirements by July. "We have to be confident that what we're doing is doable."

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