Massachusetts Provides Revised Guidance on Minimum Creditable Coverage Requirements

We have heard a lot this week about a would-be small businessman in Ohio and whether the Obama health plan or the McCain health plan would be better for his business and his employees. While this is all speculation at this point, a very real decision will be made today in Massachusetts that will affect the cost of health coverage small businesses will pay in that state and that could provide us with look at possible things to come on the national level if legislators attempt to micromanage the choice of plans available to employers and individuals.

The Connector Board is set to meet this afternoon to decide on revised Minimum Creditable Coverage (MCC) regulations. The regulations determine coverage standards for health plans Massachusetts residents must have to comply with the individual mandate. While there is no mandate that an employer’s plan satisfy the MCC requirements, employees enrolled in a plan that fails to meet them may be subject to a tax penalty.

Some employers, including Jon B. Hurst, the President of the Retailers Association of Massachusetts argue that the changes being considered will raise costs for small employers and businesses. Hurst, in a post on the Commonwealth blog, is calling for the Connector Board to call a time out to put on hold all of the changes proposed for January, 2009.

Hurst writes that efforts to derail the availability of important choices on high deductible health plans and health savings accounts ignore the reality of how small businesses and individual consumers live in times of no income growth.

Health Plan Innovation Take: Since the Connector Board is issuing final regulations to implement legislation that has already been passed, it not likely to call a time out or block any of the key elements of the plan. Understandably, if a governmental entity is going to pass legislation as Massachusetts has done that requires everyone to buy health insurance, there must also be rules defining minimum coverage. The problem arises when there are attempts to micromanage the process as looks to be the case with the Massachusetts rules around deductibles and prescription drug coverage that puts in question the ability of high deductible heath plans coupled with health savings accounts to qualify as credible coverage. As Mr. Hurst points out, in times of economic hardship it does not make sense to eliminate plans that Congress has put in place to make health insurance more affordable and to give patients more control over their health care expenses. Hopefully this lesson will not be lost on the next team of reformers to occupy the White House. Rules defining minimum acceptable coverage levels must be set so as to protect consumers from scams that offer no real protection, but they must be broad enough to allow for consumer choice and future innovation. To do this will require both wisdom and restraint.

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