With the GOP-controlled Congress moving rapidly to dismantle President Obama’s health care law, Governor Charlie Baker is urging fellow Republicans to maintain several key provisions of the Affordable Care Act, including allowing Massachusetts to keep its first-in-the-nation mandate that all its residents have health insurance.
In a letter to House majority leader Kevin McCarthy, made public Thursday, Baker laid out a position in stark contrast to his fellow Republicans in Washington, who, with President-elect Donald Trump’s backing, are already working to eliminate Obama’s health care plan. The Senate voted Thursday morning in favor of a major step toward repeal.
Baker said that any changes should be rolled out gradually, and allow states to opt out of new requirements or keep existing programs.
Speaking to reporters, the governor said he will push aggressively for policies that help Massachusetts.
“My responsibility at this point is to advocate and lobby for what I think has made the Massachusetts system successful,” he said.
But Baker is asking for adjustments to the status quo, too, partially in an effort to save the state money. He wants fewer working people with access to employer-based insurance to be able to choose taxpayer-subsidized plans with lower out-of-pocket costs instead.
Baker, a former health care executive, emphasized that he backs policies that result in nearly all residents having health insurance and opposes any changes that would undermine the state’s health care safety net or result in less funding from the federal government.
“Massachusetts believes strongly in health care coverage for its residents,” he wrote, adding that the state has the highest percentage of residents covered in the country — about 97 percent.
Baker made clear that he believes some changes are sorely needed. He is asking for fixes to help solve a troubling problem that has cropped up in recent years: about half a million working people and their families in Massachusetts shifting from commercial, employer-based health insurance to taxpayer-funded health insurance. That’s one factor in what Baker sees as unsustainable increases in state health care spending.
Under the health care law signed by Governor Mitt Romney in 2006, most Massachusetts workers were mandated to take health insurance offered by their employers. But when Obamacare kicked in, many more people who met certain income requirements were suddenly allowed to choose a taxpayer-funded health insurance option, even if they could get insurance through work. And lots shifted to the choice that was cheaper for them.
Since 2012, Baker wrote, the percentage of residents on commercial insurance has decreased seven points, while Medicaid enrollment has jumped the same amount and now covers almost 30 percent of the population.
That shift “has disrupted the stability of the Commonwealth’s coverage landscape,” Baker wrote.
The administration is considering different ideas to tackle the problem, including implementing a new fee (“an assessment”) on employers to help cover the soaring costs of Medicaid, according to several people with knowledge of the deliberations.
The administration is also working on ways to reduce health care costs for businesses, said another person with knowledge of the deliberations.
In his letter, Baker bucks some key conservative economic ideas, effectively coming out against two elements backed by GOP heavyweights in Washington.
Baker’s letter cast shade on a favorite Republican idea for reforming the health care market, the establishment of high-risk pools for insuring people who are sick. The governor said he was concerned about moving to high-risk pools, given that they have “not been particularly successful.”
He effectively opposed the federal government giving states lump sums for Medicaid, the joint state-federal health program for the poor and disabled, instead of paying for half of Medicaid costs, as it currently does for Massachusetts.
“We are very concerned that a shift to block grants . . . for Medicaid would remove flexibility from states as the result of reduced federal funding,” Baker wrote.
Baker, who was responding to a congressional request for input from governors, also called for maintaining the state’s deal with the federal government to fund Medicaid. His administration secured the five-year deal just days before the Nov. 8 election, locking in $29.2 billion in federal money. The Trump administration could seek to rework the agreement.
In recent years, Medicaid has eaten up a larger and larger chunk of state spending, meaning there is less money to spend on other areas, such as education and transportation. Currently, it represents about 40 percent of the state’s nearly $40 billion budget. Spending on MassHealth, the state’s Medicaid program, has doubled since 2007.
Democrats voiced support for Baker’s letter Thursday.
US Representative Michael E. Capuano, a liberal Democrat from Somerville, said, “Bottom line is: Most of this letter, I agree with!”
He framed the letter as containing the core message congressional Democrats have long trumpeted. “That’s what this letter says: Don’t gut it, but fix it,” Capuano said in a telephone interview.
Asked how to move forward, he had a quick retort: “Don’t know! This is what the Republicans are struggling with themselves. All of a sudden, they’re the dogs that caught the bus.”
Noah Berger, president of the liberal-leaning Massachusetts Budget and Policy Center, said Baker is “sending a very important and pragmatic message: This law is basically working, there are things that could be done to improve it, but repealing it in total could have very negative effects.”
John E. McDonough, a professor at the Harvard T.H. Chan School of Public Health who worked on writing the Affordable Care Act, said that Baker is in line with some other Republican governors “who are deeply concerned that our congressional leadership wants to take a meat ax to Medicaid and achieve their fiscal goals by passing a huge burden to the states.”
Baker’s letter has extra credibility, McDonough said, because of his deep experience in health care, which includes a decade as chief executive of the insurer Harvard Pilgrim Health Care.
In Baker’s letter were some areas of agreement with the incoming administration of Trump. For instance, the governor said Congress must address the growing cost of prescription drugs.
Massachusetts has long been a leader in health care reform. Its sweeping 2006 law created near-universal coverage for the state’s residents. Among its key components: a mandate that every resident get health insurance.
Major aspects of the federal health care law were based on what had come to be known as Romneycare.
Baker, who won election in 2014 by an extraordinarily slim margin, is up for reelection in 2018.
Many in Massachusetts are bracing for chaos if the national health care law is repealed without a replacement. While the state expanded insurance coverage more than a decade ago, half a million additional residents gained coverage through the Affordable Care Act — about 300,000 through Medicaid and nearly 200,000 who received subsidized coverage on the state Health Connector.
A coalition of groups representing Massachusetts hospitals, insurers, employers, and consumer advocates emerged last week to fight against the effects of a repeal.