Washington, Nov. 14, 2006-By focusing on health-care consumers-offering them direct access to a variety of insurance plans and providing premium assistance when necessary-the revolutionary health reforms adopted earlier this year in Massachusetts can be a model for other states seeking a viable path toward universal health coverage, according to a paper appearing in the new issue of Health Affairs.

Authors Ed Haislmaier and Nina Owcharenko, health policy experts at The Heritage Foundation, note that the commonwealth's health-insurance system overhaul embraced two key innovations that, taken together, should serve as models elsewhere. First, it created a "single market" structure to make more health-care plans available to more people. Second, instead of providing subsidies to caregivers (such as hospitals and doctors), it will instead provide subsidies to consumers so they can purchase their own insurance coverage.

"Perhaps the most important insight behind the Massachusetts legislation was the realization that the whole was greater than the two parts," they write. The reform not only aims to cover the uninsured, it aims to make it easier for all state residents to obtain a private insurance plan they like.

This "consumer-focused approach to health system change" has three crucial features, the Heritage experts write. It will make private coverage available to any state resident, make health-insurance plans portable and make coverage easier to obtain and keep.

At the same time, Massachusetts has improved its approach to covering the uninsured. Instead of simply pouring money into Medicaid, the Massachusetts approach pools that money and uses it to buy individual insurance plans for needy residents. This holds down costs while also giving the poor more and better health-care options.

It "also eliminates any stigma associated with enrollment in public programs, since service providers don't know the source of the funds used to purchase private coverage," the experts write.

"The problem of the uninsured can never be adequately and effectively addressed without first tackling the issues of coverage continuity and portability," they conclude, two key problems the Massachusetts approach solves.