Commonwealth Care Cost to Double

February 5, 2008

Per Patrick administration briefings and public news reports, Commonwealth Care, the state´s subsidized insurance program, is expected to roughly double in size and expense over the next three years. State projections obtained by the Boston Globe show the program reaching 342,000 people and $1.35 billion in annual expenses by June 2011. Those figures would far outstrip the original plans for the Commonwealth Care program, largely because state officials underestimated the number of uninsured residents.

Much will depend on the funding level of the upcoming Medicaid waiver with its planned for supporting 50% of the cost of the program. "The state alone cannot support that kind of spending increase," said Michael Widmer, president of the Massachusetts Taxpayers Foundation, a business-funded budget watchdog group.

Currently, 169,000 people have enrolled in the program, which is expected to cost $618 million in the fiscal year ending June 30. When it authorized the program in 2006, the Legislature estimated that about 215,000 people would eventually be enrolled at a cost of $725 million. State officials in late 2006 reduced that estimate to between 140,000 and 160,000 - a number that was surpassed last year.

If the state doesn´t get all of the federal funds it is seeking, policy makers could face difficult choices: spend more state money or cut back the two programs by reducing enrollment, cutting subsidies, or eliminating benefits. "We need that [federal money] to be able to continue the effort to provide MassHealth and Commonwealth Care to everyone who is eligible," said Thomas Dehner, director of MassHealth.

As more uninsured residents were covered, the state had expected to shift hundreds of millions of dollars from free care to insurance subsidies, but the drop has only been about nine percent. The state had also counted oncollecting tens of millions of dollars from penalties from businesses that do not insure their workers but know it expects to collect about $5 million.

Some advocates have proposed cutting the money allocated to hospitals and physicians that were part of the original intent of the law.

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