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200,000 in Massachusetts May Require More Health Insurance

By Alice Dembner

More than 200,000 people with health insurance would have to buy additional coverage to meet proposed minimum standards under Massachusetts’ new health insurance law, according to a count completed by insurers Monday.

Most of the individuals do not have coverage for prescription drugs or have drug coverage that is more restrictive than the minimum proposed by the state board implementing the law. The Commonwealth Health Insurance Connector board is scheduled to vote on the standards in March. Individuals would face a fine of about $200 next year and more in future years, if they do not have insurance that meets the standards.

“It’s very troubling,” said Richard Lord, president of Associated Industries of Massachusetts and a member of the Connector board. “The new law was about expanding access for people without any health insurance. I don’t think we should be forcing people who do have some coverage to spend more.”

The number of residents whose insurance would not meet the minimum standards is more than four times the estimate made by the board’s staff earlier this month before the board altered the proposed standards. And the new number includes only those covered by the five largest Massachusetts insurers. It does not include tens of thousands more who have policies that set dollar limits on coverage, policies that the board also said were inadequate.

The minimum standards are still very much in flux. The board postponed a final decision last week because of concern about the cost of the basic plans.

Many of the initial bids from insurers who hope to offer the plans carried premiums that the board considered unaffordable. Based on bids from insurers, the board estimated that a rough average premium would total $380 a month, far above the $200 cited by then-Governor Mitt Romney, before the health law was passed. The board added more requirements and then asked insurers to submit new bids with lower price tags.

Under the law, adults must obtain coverage that meets the minimum standards by July 1 or pay a penalty, unless they get a waiver by proving they can’t afford insurance. The first-year penalty, a loss of the personal tax exemption, wouldn’t kick in until after people file their 2007 taxes.