Baker will agree to new healthcare fees, fines for employers
State House News Service
Gov. Charlie Baker will sign into law $200 million in new fees and fines on Massachusetts employers to help pay for MassHealth.
Gov. Charlie Baker will sign into law $200 million in new fees and fines on Massachusetts employers to help pay for MassHealth without sought-after reforms to the program, putting his faith in the Legislature to follow through on pledges to work with him this fall to control growth in Medicaid and health care spending.
Risking political backlash from influential business groups, Baker, in an interview in his office Tuesday, said he hoped the decision to sign, and not veto, the measure on Wednesday would remove the controversial employer assessments as a hot potato in the Beacon Hill debate over rising Medicaid spending.
With the focus off the assessments, the governor believes his administration and Democratic leaders will be able to zero in on reforms in the coming months that will put MassHealth on a more sustainable trajectory. Democratic leaders in the House and Senate would appear to have the votes to override a veto, but the issue would have lingered over the Legislature for weeks until they return after Labor Day from their summer recess.
"The Legislature told us they would work with us on this, and we're going to take them at their word," Baker said. The Republican said public comments and private conversations with legislators have convinced him they are serious about tackling the spending problem.
MassHealth, which offers insurance coverage for 1.9 million low-income and disabled residents, has a budget of more than $15.6 billion in fiscal 2018, and without the governor's reforms is expected to grow by $300 million this year.
Baker returned the employer assessments and unemployment insurance (UI) rate relief to the Legislature last month, insisting they be packaged with MassHealth eligibility reforms to address the long-term growth trend in the program, which is crowding out available funds for things like education and public safety.
He gave lawmakers 60 days to hold hearings and vote on his legislation. They quickly held a hearing and promptly rejected his MassHealth reforms by veto-proof majorities, sending the employer assessments and UI measures back to the governor with a sign-or-veto option.
The package of assessments, reforms and UI rate relief was carefully crafted over several months with input from the business community after lawmakers and companies initially balked at the administration's proposal in January to tax employers at $2,000 a head to pay for the shift of full-time workers from commercial coverage to MassHealth under Obamacare.
He presented the recommendations to budget negotiators in late June - too late, lawmakers said, for them to properly vet the proposal.
In signing the assessments, Baker risks angering those members of the business community who negotiated the package with the administration and conditioned their support of the assessments on being part of a package with longer-term MassHealth cost controls.
"We urge Governor Baker to veto the health care assessment in its current form. Not only do we believe that the time has come to prioritize reining in MassHealth spending, but we fear that the "temporary" healthcare assessment may ultimately be added to the long list of permanent costs for Massachusetts small businesses. Our members already struggle to provide health coverage for their workers and do not need an additional expense to make a bad situation worse," National Federation of Independent Business Massachusett State Director Christopher Carlozzi said in a statement last week.
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