Health Care and the Massachusetts Senate Race

What’s bothering folks up there, anyway?

When President Obama came to Massachusetts to rally the troops for Martha Coakley Sunday, he had little to say about health care. That was curious, considering that the White House needs Coakley to keep his filibuster-proof Senate intact so the health care bill makes it to the finish line. It’s also puzzling considering that for weeks health care has been Topic Numero Uno, and the president has been working behind the scenes to shape the legislation.

In his remarks, the president noted that Coakley as attorney general had gone after big insurance companies that misled people into buying coverage, only to deny it when they got sick. Later in his talk, he told the crowd that when it comes to taking on the worst practices of insurance companies that routinely deny Americans the care they need, she’s going to be on your side. That was pretty much it. No mention of how Massachusetts reform became the model for national legislation; no mention of the state’s high cost of medical care; no mention that many residents have dropped coverage because they can’t afford it and are willing to take the penalty; no mention that small businesses are struggling mightily to pay their premiums.

It’s not unreasonable for Massachusetts residents to want their U.S. senator to be on their side, especially when it comes to the state’s soaring cost of health care—an issue simmering beneath the surface, even if it hasn’t quite bubbled over as a major issue, in Coakley’s campaign against Republican Scott Brown. “Small businesses are mad as hell,” says Jon Hurst, who runs the Retailers Association of Massachusetts, a trade group of some 3000 firms. “This is by far the worst year we’ve seen since the [reform] law has gone into effect.” Hurst is talking about the double-digit insurance rate increases his members are seeing in renewal envelopes. The premiums for his own five employees have jumped up thirty-three percent. The next logical step, he says, is a high deductible policy to bring down the price.

Bruce Derosier owns a fitness center in Spencer, a town of about 13,000 in the middle of the state. The premium for his individual policy was affordable at $1,800 nine years ago, but the $9,100 he pays now is not. His agent found him a similar Blue Cross policy for about $6,000 a year, but warned him it was an introductory offer and that the price could go up next year.

Bob Cirba, a painting contractor from Spencer, and his wife, Joy, just got word from their agent that Blue Cross was increasing their premium from $1,002 to $1,594, a 59 percent hike. And that’s for an HMO with a deductible of $1,000 for each family member. “It’s not realistic that a family of four in middle America can come up with over $1,500 a month just for health insurance,” Joy said. They are weighing their options. In western Massachusetts, Terry Carlo and her husband weighed theirs, and last month dropped their policy when the premiums rose thirty percent. Says Hurst: “Providers have gone unchecked because the insurers are more or less working for providers not subscribers. A year after the handshake we’ve made no progress, and that’s discouraging.”

A few days before the president’s visit to Boston, Christy Mihos, a Republican candidate for the governor’s race next fall, issued a press release that got little attention, but asked a crucial question: What happened to the attorney general’s investigation of Partners HealthCare, the state’s biggest health system, and Blue Cross Blue Shield, the state’s biggest insurance company?

A year ago, the Boston Globe reported that the attorney general was probing whether Partners and Blue Cross “may have illegally colluded to increase the price of health insurance statewide over the last nine years.” The AG’s investigation was in response to an in-depth Globe report from late December 2008 that described a handshake agreement between Partners and Blue Cross which, the Globe said, resulted in Blue Cross raising “the rate it pays Partners by 75 percent since 2000.” Partners also pressured the state’s other big insurers to offer similarly large increases that were passed on to policyholders. “There’s still no public word. Why the delay?” Mihos asked.

It’s not clear whether or how often Coakley’s investigation has come up during the campaign, but it appears there is no resolution. In late November, the Globe reported that “no court action has been taken” in the Partners case, and it noted that Coakley had received an endorsement from Partners chairman Jack Connors Jr. A campaign spokesman told the paper that Connors’s support had no impact on her decisions as attorney general. We called Coakley’s campaign to ask about disposition of the investigation, but no one returned our call.

A review of last year’s press releases from the AG’s office indicates no settlement action against Partners and Blue Cross. But they do show that Coakley got a $10,000 settlement from Aetna because the carrier denied coverage for infertility treatment, a mandated benefit. She also reached a $17,000 million settlement with Health Markets Inc., whose subsidies, including MEGA Life and Mid-West National Life, the AG said, had engaged in unfair and deceptive practices. A couple of weeks ago Coakley obtained a $25,000 settlement from Continental American for failing to provide mandated benefits and properly cover preexisting conditions. Presumably, that’s what the president had in mind when he mentioned she took on big insurers. He did not bring up the biggest one of all—the one with power in the state.

Coakley’s actions regarding insurers’ non-compliance with rules to provide sick people coverage and to offer mandated benefits present another lesson from Massachusetts. The federal law would require mandated benefits and prohibit companies from denying coverage for pre-existing conditions. If insurers are thumbing their noses in the Bay State, what will happen in Mississippi?

Pundits say that the Massachusetts vote today is about health care nationally. That it is. It’s also about health care locally—why it’s so costly and why that cost threatens to undo the state’s fragile model. The public is demanding answers that the pols and the press have yet to supply. Telling people in Massachusetts what’s going on with Partners and Blue Cross is a good place to start.

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Trudy Lieberman is a longtime contributing editor to the Columbia Journalism Review. She is the lead writer for The Second Opinion, CJR's healthcare desk, which is part of our United States Project on the coverage of politics and policy. She also blogs for Health News Review. Follow her on Twitter @Trudy_Lieberman.