The Beacon Hill Report - April 17, 2014

Date: April 16, 2014

Related Content: News State Massachusetts

Despite a continuing impasse between the House and
the Senate over the proper form of legislation to increase the minimum wage and
change the unemployment insurance system, the House and Senate have agreed to
enact a freeze on unemployment insurance rates for 2014. The Governor had
previously delayed the due date for UI taxes from the end of April to the end
of May. When enacted, the freeze will mean that the average tax will not
increase by $260 from $680 to $940 per employee per year and a $500 million tax
increase on MA employers will be avoided.

It is important to note that, even with a rate
freeze, some companies due to circumstances unique to the particular company
may experience an increase in unemployment taxes.    

The
Patrick administration began the process of ending its contract with the
company that built the Obamacare website for Massachusetts. More importantly
for those small businesses and individuals seeking coverage through the MA
Health Connector, the earliest date for a fully functioning website for the
state exchange is now October 2014 – a full one year from the originally
intended date. Although a final decision has not been made, the administration
appears to have chosen a middle path of rebuilding the site with a new vendor
and/or using a more successful website from another state instead of either
scrapping the website and starting from scratch or working with the original
vendor to make repairs. The costs to taxpayers are mounting rapidly. Beyond the
millions of state dollars wasted on a faulty website design and the spending of
a $180 million federal grant and the forfeiting of additional federal money due
to the non-functioning system, tens of thousands of people are now receiving
health care coverage from the state with the taxpayers picking up the entire cost
at least through June and probably longer.

The
Pioneer Institute has issued one hundred questions about the website, the
funding for the website, the knowledge of the website’s problems, the failure
of the state to respond to the issues in a timely fashion, and how best to
proceed. The fact that, prior to this fiasco, the Commonwealth of Massachusetts
had a functioning system that insured 98% or more of the state’s population
only adds to the frustration and to the questions.    

Related Content: News | State | Massachusetts

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