Professor Jonathan Gruber from MIT recently spoke to a standing-room only crowd in Konover Auditorium about health care reform in the U.S. Speaking at the 2nd annual Philip E. Austin Forum on the Economics of Public Policy on “Health-Care Reform in the U.S.: What Happened and Where Do We Go Now?”, Gruber described his experience with health care reform in Massachusetts. Gruber was a key architect of the Massachusetts program. He described Massachusetts’ “three-legged stool” approach to ensuring adequate health care coverage, which includes (1) insurance market reforms (to prohibit exclusions or pricing based on health status), (2) a mandate that individuals buy insurance (or pay a penalty for not doing so), and (3) subsidies to help low-income individuals comply with the mandate.
Gruber then compared the Massachusetts experience to the experience of federal health care reform embodied in the Obama-led Affordable Care Act. He noted that, while the federal reform is based on the same three-legged stool approach used in Massachusetts, it is more ambitious (and hence challenging). Unlike the Massachusetts reform, the federal program had to find new sources of money to fund the subsidies required to ensure access to insurance for low income individuals. In addition, the federal reform sought to bring down rising health care costs, which was not a primary goal of the reforms in Massachusetts. Gruber went on to discuss the challenges currently facing the implementation of the federal reform.
Professor Gruber is a leading expert on the economics of health care. He has published extensively on this topic and has served as an advisor on health care reform at both the state and federal level. The Austin Forum is designed to bring experts such as Professor Gruber to UConn to discuss important, contemporary public policy issues from an economic perspective, and to honor the legacy of President Phil Austin, who served as President of the University from 1996-2007 and is currently serving as Interim President.
You say Gruber said:
“Unlike the Massachusetts reform, the federal program had to find new sources of money to fund the subsidies required to ensure access to insurance for low income individuals. In addition, the federal reform sought to bring down rising health care costs, which was not a primary goal of the reforms in Massachusetts. ”
If you are quoting him correctly, I do not understand his statements.
Massachusetts had to find $300 million to $400 million in “new sources” to fund its subsidies (meaning basically free) insurance. It raised sales taxes 20% and cut funding for all other types of state services — other than healthcare — by 7% (all of the healthcare increase was not tied to so-called reform; some was just plain healthcare cost inflation).
As for controlling costs not being a “primary” goal, that’s a nuance that most Massachusetts voter would not recognize. Sort of like Clinton saying “I did not have sexual intercourse with that woman, Miss Lewinsky.” Maybe cost control was not a major goal, but it was a very important, key, much discussed, often hyped goal. But instead of the effort being budget neutral for the state, as promised, the costs went up the $300-$400 million mentioned above. And everyone else’s premiums and provider charges skyrocketed because of the changes in market dynamics that Gruber’s plan caused.