Massachusetts health bill would burden businesses

Freedom Newspapers

Massachusetts is making its second attempt at a form of mandatory universal health insurance coverage, an idea that it first tried, unsuccessfully, in the late 1980s.

Last week, the Massachusetts Legislature passed, with almost unanimous bipartisan support, a bill mandating that all residents must have health insurance.

Republican Gov. Mitt Romney, a presidential contender in 2008, “is expected to sign the bill, though he may veto a $295-per-employee fee for businesses that don’t offer insurance,” The Associated Press reported on April 6.

The bill takes effect in July 2007.

The scheme is complex, but includes several mandates. Every month, Medicaid and private insurance companies must turn over the lists of those covered, giving the state government intrusive new powers. Beginning in 2008, everyone filing state tax returns must “indicate if they have health insurance,” AP reported. If someone lacks such insurance, penalties begin. For example, personal tax exemptions would be cut off.

The poor will get subsidized insurance “with no premiums and no deductibles,” AP reported.

This plan could go the way of the plan imposed in 1988 by then-Gov. Michael Dukakis, which was somewhat different.

“Employers with five or more workers were to pay a ‘medical security contribution’ equal to 12 percent of the first $14,000 in wages for each employee,” according to a 1993 study of the Dukakis plan by the libertarian Cato Institute.

The plan was delayed, then canned, in the 1990s because of high expected costs.

This top-down, mandatory approach is the wrong pill to swallow. A better prescription is not to increase tax and regulatory costs to businesses, but to reduce them so businesses have more money to pay for coverage. Another reform is to expand tax-free health savings accounts.

Choice, not coercion, is what the doctor ordered.