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from NewsLink, Vol. 4, No. 4, Summer 2000
In July, BHI Executive Director David Tuerck addressed 100 members of the American Legislative Exchange Council's Task Force on Health and Human Services during ALEC's 2000 Annual Meeting in San Diego. His presentation, Universal Health Care: Bad Medicine for Massachusetts, described four Massachusetts universal health care scenarios and their costs to the Commonwealth.
The four schemes are:
• A single-payer system, similar to that in place in Canada and Europe, under which the state would provide health insurance for all residents.
• Mandated health care, under which (a) employers would be required to provide health insurance to all employees through the current private insurance system and (b) the state would cover unemployed uninsured residents through Medicaid.
• Pooled health insurance, under which the state would provide health insurance for all uninsured residents.
• High-risk pooled health insurance, under which the state would provide health insurance only for the uninsured and uninsurable.
Of these, the most costly and economically damaging is the single-payer system. According to BHI's analysis, a single-payer system would compel the state to raise the personal income tax by 173%. The result would be the loss of 917,000 jobs – one-fifth the state labor force – and $45 billion in payrolls.
Mandated health care would add almost a billion dollars to employer health care costs and require the state to raise an additional $223 million in tax revenue. The result: a loss of 45,000 jobs and a $4.3-billion reduction in payrolls.
The cost to Massachusetts of insuring all uninsured residents would be about $1.6 billion. Because of the rise in the income tax necessitated by this change, there would be 172,000 fewer jobs and $11 billion in reduced payrolls.
The least burdensome system for Massachusetts would be high-risk pooled health insurance, requiring the state to raise $285 million in new revenue, with a consequent loss of 25,500 jobs and $1.62 billion in payrolls.
A forthcoming Beacon Hill Institute study will detail these estimates. This summer, the Massachusetts legislature passed and Governor Cellucci signed a Patients Bill of Rights that guarantees that all HMOs provide the same protections to all members. A November 2000 ballot initiative would go further, establishing “a state Health Care Council to review and recommend legislation for a health care system that insures comprehensive, high quality health care coverage for all Massachusetts residents.” If passed, the ballot initiative could lead to the adoption of some form of universal health insurance.
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