The state Senate, in an 11th-hour bid to keep $385 million in annual federal Medicaid money coming into Massachusetts, will debate a slimmed-down healthcare bill today that aims to cover roughly half of the state's uninsured residents through new subsidized insurance plans.
Senate President Robert E. Travaglini released the new plan after talks with the House over a more comprehensive healthcare measure deadlocked. The state, he said, faces an ''emergency situation," because it could lose the Medicaid money if the Legislature doesn't act immediately on a federal mandate: begin moving the 500,000 to 600,000 uninsured people into insurance plans.
Unlike House Speaker Salvatore F. DiMasi and Governor Mitt Romney, Travaglini has long advocated a gradual approach to covering the uninsured, laying out a broader plan last year to cover about half of them. The plan Travaglini unveiled yesterday employs different strategies to meet a similar target.
Like his first proposal, the plan Travaglini put forward yesterday would allow insurance companies to offer cheaper, stripped-down policies with high deductibles. But unlike his earlier plan, which would have expanded Medicaid eligibility, he now envisions the state purchasing private health plans for about 65,000 of the poorest residents and subsidizing premiums for those between 100 percent and 300 percent of the federal poverty level.
Senate leaders say the new plan, estimated to cost $25 million in the first year, would cover up to 305,000 people, although that's the best-case scenario, in which everyone who is eligible signs up. No one would be required to purchase insurance.
''We are trying, I think, to the best of our abilities to continue to discuss this, to reach consensus and compromise and to send a comprehensive package to Washington that we can all be proud of," Travaglini told reporters at a State House news conference. ''And that's my goal."
Travaglini described the scaled-back measure as a ''placeholder" plan to satisfy the federal government's demands. He said he hoped negotiations with the House over a more comprehensive healthcare reform could continue, although he said late last week that those discussions had reached ''gridlock."
But the Senate's new bill hinges on low- and moderate-income residents, who get emergency care free from Massachusetts hospitals, deciding to purchase an insurance plan. So some critics question whether the measure, lacking a hard incentive for people to sign up, would extend coverage to anywhere near 305,000 people.
Jonathan Gruber, a professor of economics at the Massachusetts Institute of Technology who helped DiMasi draft the House plan last year, said that without requiring people to buy insurance, Travaglini's proposal will cover no more than 150,000 people. DiMasi and Romney included a so-called individual mandate in their proposals, a strategy many healthcare specialists say is essential to covering everyone.
''You need the individual mandate to get the majority of the uninsured," Gruber said. ''Is the goal to provide universal access or universal coverage? What Travaglini is trying to do here is provide universal access."
DiMasi issued a statement late yesterday reiterating a criticism he lobbed at the Senate last week: that it has not been a responsive partner in healthcare negotiations since they began last fall.
''This is the first detailed counterproposal that the Senate has presented throughout Conference Committee negotiations," DiMasi said. ''In the absence of an offer of comprehensive healthcare reform, the House of Representatives will review and respond to this development in a timely manner to ensure the minimum requirements of the waiver are met."
Romney released a statement yesterday saying: ''I haven't analyzed the Senate President's plan in detail, but I am in favor of anything that gets the two sides talking again. I applaud the Senate President for his attempt to keep the ball moving."
The Senate's new proposal is born out of an acrimonious impasse among the House, Senate, and Romney over how to achieve healthcare reform. A primary sticking point is that DiMasi wants an assessment on employers who don't provide coverage for their workers, which Travaglini and Romney reject. The standoff has derailed the chances, at least for now, of a more ambitious healthcare reform package that state leaders hoped last fall would lead to a historic effort to cover all or most of the state's uninsured.
The federal government has given little guidance to Massachusetts about what it needs to do to keep getting the Medicaid money in the next fiscal year, which begins July 1. The government has said it needed 120 days to review the state's plan, which means Massachusetts would need to pass something by this week.
But it's unclear exactly how firm the federal government's deadlines are. Peter Ashkenaz, a spokesman for the federal Centers for Medicare and Medicaid Services, said yesterday: ''There really isn't a date. But it's going to be tough to meet the July 1 start date if we don't get a package soon."
Mary Kahn, a Centers for Medicare and Medicaid Services spokeswoman, said last month that if the state's plan was not completely vetted by July 1, the state could move ahead using its own money initially and receive federal reimbursement retroactively.
State leaders have worked closely with Senator Edward M. Kennedy to ensure that the state keeps getting the federal money. A spokeswoman for Kennedy's office said yesterday that they were still studying the revised plan and that it was too soon to say whether it would satisfy the federal mandate.
The Senate plan envisions free healthcare plans for the poorest residents and sliding-scale premiums for those up to 300 percent of the federal poverty level, which is $9,800 for an individual and $20,000 for a four-person household. It also would set up an entity called the Commonwealth Care Health Insurance Exchange Authority to oversee the subsidized health plan and allow people to set aside pretax dollars to pay for healthcare.
Even if the state goes with the Senate plan and it insures 300,000 people, that would leave 200,000 to 300,000 people uninsured and reliant on the free-care pool, an increasingly expensive method of care. The federal government, which helps pay for the free-care pool, is encouraging states to ease the demands on it by moving people on to insurance plans.
John McDonough of Health Care for All, a Boston-based advocacy group, called Travaglini's new plan ''a significant step backward in terms of where the Senate has been as recently as last week." Health Care for All is part of a coalition of groups backing a November ballot initiative that would cover the uninsured using an expansion of Medicaid and a payroll tax on businesses.
''The notion of putting through special legislation at this point without any ability for public review or comment is troubling," McDonough said. ''We are pleased that the Senate is recognizing the pressure of the federal deadline. . . . Right now we have a question about whether or not this proposal is the right thing, and we certainly don't think it's being done right."
For example, McDonough said he was troubled by the fact that Travaglini's new plan would allow insurance companies to charge high annual deductibles: $5,400 for families and $2,700 for individuals. That means some families with insurance would have a hard time paying medical bills, he said.
Alice Dembner of the Globe staff contributed to this report; Scott Helman can be reached at email@example.com.