Lepore: Admin open to “other ideas” to address rising Masshealth costs

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BOSTON (STATE HOUSE) – If the business community or anyone else knows of a better way to get employers who either don’t offer health insurance or who don’t get enough employees to take their plan to help defray the costs associated with MassHealth, the Baker administration wants to hear it.

Administration and Finance Secretary Kristen Lepore on Thursday told a panel of state budget writers the administration is open to revising Gov. Charlie Baker’s controversial proposal to impose a $2,000 per employee assessment on companies that don’t meet certain requirements.

“We have said all along that this is a proposal, that we’re open to other suggestions, but clearly we have an issue here,” she said.

The administration’s proposal is intended to stem the flow of full-time workers who choose to enroll in MassHealth rather than their employer’s plan, a cost driver that’s straining the entire state budget and consuming funds that could be invested elsewhere.

MassHealth reached an all-time high enrollment — covering a projected 1.93 million people in fiscal 2017 — putting major pressure on state finances.

The assessment is projected to generate $300 million over the last six months of the fiscal year and would generate as much as $585 million when in effect for a full year, according to Baker administration estimates.

The new revenue is intended to help offset $600 million in increased Medicaid costs projected for fiscal 2018.

The business community — including the Greater Boston Chamber of Commerce and the Massachusetts Taxpayers Foundation — has panned Baker’s proposal as an unfair penalty and claim it is based on a faulty premise.

The North Shore Chamber of Commerce Board voted in February to oppose the proposed assessment, reporting that its members “believe the tax is unaffordable and will prevent small businesses from growing and hiring.”

Lepore said the administration has been working with business groups to discuss possible alternatives.

“If someone else has a better idea on how to accomplish this then, yes, we are open to other ideas,” Lepore said. Asked if that meant the administration would be open to an entirely new mechanism for employers to contribute, she said, “Sure. If it’s a better way to do it, sure.”

She said there is not one particular alternative that the administration or the business community have focused on, and said business groups have provided “very valuable feedback about how our proposal would impact the business community.”

Copyright 2017 State House News Service

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