Most in Massachusetts met individual insurance mandate

Only 2.5% of tax filers paid a penalty for not having health insurance. But a physician shortage could pose problems for the reform program.

By Doug Trapp, AMNews staff. June 23/30, 2008.

Washington -- Ninety-five percent of Massachusetts tax filers for 2007 said they met a state mandate to have health insurance -- a compliance rate that health system reform stakeholders touted as a sign the new program is working.

"It's been wildly successful," said Mario Motta, MD, president-elect of the Massachusetts Medical Society, especially enrollment in the state-subsidized private plans for people earning 300% or less of the federal poverty level.

Brian Rosman, research director at Health Care For All, a Massachusetts patient advocacy organization, was impressed that so many residents met the new requirement. "I was frankly expecting a much higher noncompliance rate, like 15% or 20%."

The findings are based on a Massachusetts Dept. of Revenue analysis of 86% of the expected 2007 tax filers, or about 3.3 million people. Insurance status is self-reported on tax returns and will be verified by the Dept. of Revenue.

Massachusetts residents are required to have health insurance, prove they cannot afford it or pay a tax penalty, which will rise from $219 in 2007 to a maximum of $912 for the 2008 tax year.

Of the 5% of residents who said on their 2007 tax returns that they don't have health insurance, about half, or 2.5% of tax filers, were deemed by the state to be able to afford coverage. They were subject to the $219 penalty. Another 2% of tax filers were deemed unable to afford health insurance and were exempt from the mandate.