Mass-Care Criticizes MA Association of Health Plans

Contact Stephanie Nakajima, Executive Director, Mass-Care: the Massachusetts Campaign for Single Payer Health Care,, (617) 297-8011.

Massachusetts Association of Health Plans President & CEO Lora Pellegrini criticized single payer healthcare on grounds that were inaccurate and misleading. MAHP's characterization of An Act Establishing Medicare for All in Massachusetts is inaccurate, and includes claims debunked by the Oct. 26 hearing by the Joint Committee on Health Care Financing and the economic analysis by Prof. Gerald Friedman, UMass Amherst.

Pellegrini equates having some kind of health insurance with health care access. Her claim that “almost 98%” (the correct figure is 97%) of Massachusetts residents have health insurance is misleading; 48% of Massachusetts residents, including 47% of those with health insurance, report that cost was a problem in their ability to access needed health care. Many, possibly 4,000 each year, die from lack of adequate care.

Pellegrini does no better in making comparisons between the current health insurance industry and the proposed Massachusetts Health Care Trust. Warnings of a “one-size-fits-all, government-run health care system” are no more accurate today than they were when used against RomneyCare in 2006. On the contrary, reformers today argue for keeping the existing private delivery system, with only the extension of public financing to everyone via the Trust.

But in fact, there’s something that should “fit all”: ready access to comprehensive care with no financial barriers. We can't know, in advance, what our health care needs will be in the future. What the Massachusetts Association of Health Plans would have us do is gamble. A young person in good health might choose the skimpiest plan with the lowest premiums, gambling on their chances of staying healthy, then get hit by a car, spend months in the hospital, and go bankrupt.

Of course, substituting public for private insurance will require increases in public revenues, but not as much as current spending. There are tremendous savings in private revenues, that is, insurance premiums and cost-sharing, including deductibles and co-pays (including those costs hidden in home and business insurance, injury compensation, and unemployment insurance). The new system will replace this “private taxation” with lower payroll and unearned income taxes.

The Massachusetts Health Care Trust, providing insurance to the largest possible pool, will eliminate major costs and have the bargaining power to control the others. This reform will reduce total health care costs by over $34 billion a year through savings on administrative bloat and monopoly pricing of drugs and other goods and services.

Pellegrini cites “the critical work we must do to control health care costs for employers and consumers.” But her industry has been incapable of controlling costs without government intervention. Private health insurance companies favor high premiums and cost sharing and signing up healthy patients who won’t cost as much to insure. They have years of experience cherry picking healthy patients, denying payments for expensive drugs, and delaying appropriate care through complex bureaucratic processes that save them money but hurt patient outcomes.

The proposed reform allows patients, not insurance companies, freedom and choice. Everyone can access the care they need – the Act says “all medically necessary care” – because there are no financial barriers, no more premiums and out-of-pocket costs keeping people from getting routine preventive care or appropriate emergency care.

Moreover, patients would not have to struggle to find a plan that meets their needs for coverage including their primary care, their specialty referrals, their medications, and coverage for family members. Switching plans because employers frequently choose cheaper plans disrupts health care.

True choice is when all medical care is available; we choose our doctor, hospital, treatment, and can change that choice. Health care coverage choice is only available to all in this reform.

This reform would also reduce burnout among physicians and other health care providers by eliminating and simplifying billing and removing oppressive bureaucracy and red-tape, oversight, prior-authorization, and utilization review by insurance companies, who use these to limit access to health care. Providers will not have to pay for extra office staff to deal with getting paid in a timely and accurate way. Medicare, for example, runs at 3% overhead and pays bills promptly.

The savings and simplicity will benefit virtually everyone and every business and every level of government in the Commonwealth. Even Insurance executives at the MAHP will see their costs come down. But also their profits, which is probably why they oppose this sensible reform.

This statement was prepared by Prof. Gerald Friedman, Patricia Berger MD, Alan Meyers MD, and Jon Weissman, Mass-Care Co-Chair.