Phase-in of Minimum Coverage Recommended

March 14, 2007

The State House news reports that yesterday the staff of the state Connector Authority today recommended mandating drug coverage in Massachusetts insurance plans but only after Sept. 1, 2008 to give the industry time to adjust and people enough time to switch plans, if necessary.

The full board is scheduled to meet on March 20 to vote on draft regulations on minimum coverage. Public hearings on the proposed regulations would take place in May and a final vote is expected in June. Board Chair Leslie Kirwan said for the next meeting, the Connector staff will revise today's recommendations with more information on phasing-in the minimum coverage requirement, drug benefits, lifetime maximum insurance and health savings account plans. "I think we talked about a lot of things that will be re-visited," she said.

The proposed mandate, which also includes capping the maximum out-of-pocket costs and annual deductibles and prohibiting maximum lifetime benefit caps, would establish a coverage floor for insurance plans, which all adults will be required to have by July 1 to avoid financial penalties. The proposal includes:

• The minimum coverage criteria would also cap maximum out-of-pocket spending for in-network services at $5,000 for individual coverage and $10,000 for family coverage.


• The Connector would cap the annual deductibles at $2,000 per individual and $4,000 for families.


• Possible separate deductible for drug coverage, the deductible may not exceed $250 for individuals and $500 for family policies.


• At least three individual preventive care visits and six per family would be needed to be covered by insurance before deductibles kick in.


• The criteria before the committee would also ban a fee schedule for medical services, such as a maximum benefit of $500 per day for inpatient care, or $50 per office visit.


• Prohibiting maximum lifetime benefit caps. 360,000 Massachusetts residents currently have this cap


• Plans would be required to cover preventive and primary care, emergency services, hospitalization benefits, ambulatory patient services and mental health services.

If approved, Massachusetts would be the first state in the nation to require all health plans to comply with such criteria. The changes could also affect as many as 500,000 already insured employees in the state, an insurance industry leader said.

But Marylou Buyse, president and CEO of the Massachusetts Association of Health Plans, said if the Connector approves its staff recommendations, the board could end up creating a significant disruption to 500,000 residents who would be "out of compliance" next year. She said "hundreds of thousands of people would be penalized" unfairly if the Connector mandates drug coverage, prohibits lifetime benefits and caps annual deductibles. "We are very disappointed and deeply troubled by the discussions today," said Buyse after the meeting. "I´d suggest they accept all plans that are on the market." Buyse´s argument about establishing a minimum floor of health coverage that requires people to "buy up" their insurance coverage was echoed during today´s full board meeting.

"Frankly, we don't know how to tackle this without phasing it in," said Jon Kingsdale, executive director of the Connector Authority.

Please feel free to e-mail any questions, comments or concerns. We will continue to update you as more information becomes available.

Back to Headlines

Healthcare Financial, Inc. is a one of the top resources for information on healthcare changes in Massachusetts.

Stay informed - Please sign up to receive our Industry Update emails.