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STEVE INSKEEP, host:

Lawmakers in Massachusetts yesterday enacted a sweeping healthcare reform bill. It aims to ensure insure almost every citizen over the next three years, which does not mean the state will be paying the bill.

Massachusetts is trying a different way to get universal coverage. It will require individuals to buy health insurance if their employers do not.

Here's NPR's Richard Knox.

RICHARD KNOX reporting:

It's called an individual mandate. It's like the requirement that all drivers carry car insurance.

Consumer Advocate, John McDonough, says no state has tried it before.

Dr. JOHN MCDONOUGH (Doctor, Executive Director, Health Care For All): This is absolutely fresh. This is absolutely new, and it demands serious attention and support from folks to try to make it work.

KNOX: It already has support from unlikely partners: consumer lobbyists and business leaders, liberal and conservative politicians. It breezed through both chambers of the legislature with only two no votes.

Republican Governor Mitt Romney is expected to sign it into law.

McDonough runs a group called Healthcare for All. He says Romney and the Bush administration like the idea that individuals should be responsible for insuring themselves against illness if their employers won't.

Dr. MCDONOUGH: It was an idea that resonated in certain streams of the Republican world.

KNOX: But getting to this point hasn't been easy, says Herman Hamilton, a Presbyterian minister active in the campaign.

Mr. HERMAN HAMILTON (Minister, Healthcare Advocate): Given the political context, given the tough areas that, at some point, looked like there would be no compromise, we think it's a miracle is really a good word for it. I probably would say that even if I wasn't a preacher.

KNOX: Making it work as intended may take another miracle. If individuals don't buy health insurance and the state decides there are affordable health plans out there for them to buy, they'll have to pay a penalty.

At first they'll lose their personal income tax exemption. But two years from now, state tax authorities can impose a penalty equal to half the cost of an insurance policy.

Mr. HAMILTON: The way it's supposed to work is that you're not penalized if there is an actual, affordable, quality product that's within your range. Now, the questions are who defines affordability? And what criteria do you use to define affordability?

KNOX: State officials will define it, and the criteria are still unknown.

The law does provide subsidies for many of the 550,000 currently without coverage in Massachusetts; those who make less than three times the Federal poverty level, or $60,000 for a family of four. The poorest will get free coverage.

Businesses who don't insure their workers don't get off scot-free. Mike Witmer, of the Massachusetts Taxpayer's Foundation, says un-insuring firms with more than ten employees will pay a yearly assessment.

Mr. MIKE WITMER (Massachusetts Taxpayer's Foundation): Those employers who do not provide healthcare coverage, they will be assessed a per-employee annual charge of $295.00.

KNOX: That's based on what it currently costs to maintain a state free-care fund for uninsured workers.

Mr. WITMER: To date, that cost has been borne by other employers and taxpayers.

KNOX: The law has many other features: tax incentives to purchase insurance, expansion of Medicaid, higher payments for hospitals and doctors. It adds up to more than a billion dollars--nearly all of it comes from redirecting current state and federal health payments.

Alan Weil, of the National Academy of State Health Policy, says the eyes of weary healthcare reformers across the nation will be on Massachusetts.

Mr. ALAN WEIL (President, National Academy of State Health Policy): In health policy, it's very rare for one state to copy the approach taken by another state, but it's very common to borrow elements. And I think the Massachusetts approach has enough elements that we will see other states interested in borrowing them, even if they don't pick it up wholesale.

KNOX: But first, they'll be watching to see if it really works.

Richard Knox, NPR News, Boston.

INSKEEP: And if you're in Massachusetts and wonder how this bill might affect you, you can find details at npr.org.

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