insurance market into the small group market to allow individuals to get lower group insurance rates. the process of merging the two markets also froze the market for such insurance for a short period in april–may 2010 as the current government tried to keep the leading non-profit insurers, which insure over 90% of the residents, in the state from raising premiums for small businesses and individuals. eventually the state's non-partisan insurance board ruled that the government did not have the actuarial data or right to freeze the premiums. five of the non-profit insurers then settled for slightly lower premium increases than they had initially requested rather than litigate further. the sixth litigated and won the right to implement all its original increases retroactively. payment rates were supposed to be increased to hospitals and physicians under the statute but that has not happened. the statute also formed a health care quality and cost council to issue quality standards and publicize provider performance. commonwealth health insurance connector authority the health connector is designed as a clearinghouse for insurance plans and payments. it performed the following functions: it administers the connectorcare program for low-income residents (up to 300% of the fpl) who do not qualify for masshealth and who meet certain eligibility guidelines. it offers for purchase health insurance plans for individuals who: are not working, are employed by a small business (less than 50 employees) that uses the health connector to offer health insurance. these residents will purchase insurance with pre-tax income. are not qualified under their large employer plan, are self-employed, part-time workers, or work for multiple employers, it sets premium subsidy levels for connectorcare. it defines "affordability" for purposes of the individual mandate. employer taxes employers with more than ten full-time equivalent employees (ftes) must provide a "fair and reasonable contribution" to the premium of health insurance for employees. employers who do not will be assessed an annual fair share contribution that will not exceed $295 per employee per year. the fair share contribution will be paid into the commonwealth care trust fund to fund commonwealth care and other health reform programs. the division of health care finance and policy defined by regulation what contribution level meets the "fair and reasonable" test in the statute. the regulation imposes two tests. first, employers are deemed to have offered "fair and reasonable" coverage if at least 25% of their full-time workers are enrolled in the firm's health plan. alternatively, a company meets the standard if it offers to pay at least 33% of the premium cost of an individual health plan. for employers with 50 or more ftes, both standards must be met, or 75% of full-time workers must be enrolled in the firm's health plan. regulatory and analytic information is available on the division's website. there was an additional free rider surcharge assessible to the employer. this surcharge is different from the fair share contribution. the surcharge is applied when an employer does not arrange for a pre-tax payroll deduction system for health insurance (a section 125 plan, or a "cafeteria plan"), and has employees who receive care that is paid from the uncompensated care pool, renamed in october 2007 as the health safety net. individual taxes residents of massachusetts must have health insurance coverage under chapter 58. residents must indicate on their tax forms if they had insurance on december 31 of that tax year, had a waiver for religious reasons, or had a waiver from the connector. the connector waiver can be obtained if the resident demonstrates that there is no available coverage that is defined by the connector as affordable. in march 2007, the connector adopted an affordability schedule that allows residents to seek a waiver. if a resident does not have coverage and does not have a waiver, the department of revenue will enforce the insurance requirement by imposing a penalty. in 2007, the penalty was the loss of the personal exemption. beginning in 2008, the penalty is half the cost of the lowest available yearly premium which will be enforced as an assessed addition to the individual's income tax. young adult coverage beginning july 2007, the connector offered reduced benefit plans for young adults up to age 26 who do not have access to employer-based coverage. changes to the law in 2008 and 2010, much more substantive changes were made to the law, one of the most important of which was to begin an open enrollment period for those receiving subsidized health insurance and anyone buying insurance, including those paying full price, as an individual. prior to that 2010 change, under the massachusetts law, residents buying healthcare insurance individually could do so at any time, even—theoretically—as being admitted to a hospital or entering an emergency room. this led to a gaming of the system and research by the state said this gaming added 1–2% to premium costs, which were continuing to rise for other reasons as well. given the continuing overall rise in premiums post massachusetts 2006 healthcare insurance reform, the major goal of the 2012 amendment was to introduce price controls on health care itself; it is not directly related to healthcare insurance as are the earlier legislative actions. starting in 2014, commonwealth care insurance (and commonwealth choice insurance for those not receiving subsidies) has been replaced by insurance compatible with the federal patient protection and affordable care act. among other differences, consistent with ppaca, the out of pocket spending limits and deductibles are higher under similarly priced (after a ppaca tax credit) ppaca-consistent insurance than the superseded massachusetts insurance law. to try to compensate for these higher limits and deductibles, the commonwealth funded an additional insurance program called connectorcare, by which residents who previously would have qualified for commonwealth care can get very similar benefits for about the same price. implementation the implementation of healthcare insurance reform began in june 2006, with the appointment of members of the connector board and the naming of jon kingsdale, a tufts health plan official, as executive director of the connector. on july 1, masshealth began covering dental care and other benefits, and began enrolling children between 200% and 300% of the poverty level. the federal centers for medicare and medicaid services approved the state's waiver application on july 26, 2006, allowing the state to begin enrolling 10,500 people from the waitlist for the masshealth essential program, which provides medicaid coverage to long-term unemployed adults below the poverty line. in 2006, the division of health care finance and policy issued regulations defining "fair and reasonable" for the fair share assessment. the regulations provide that companies with 11 or more full-time equivalent employees will meet the "fair and reasonable" test if at least 25 percent of those employees are enrolled in that firm's health plan and the company is making a contribution toward it. a business that fails that test may still be deemed to offer a "fair and reasonable" contribution if the company offers to pay at least 33 percent of an individual's health insurance premium. also effective in 2006, the connector board set premium levels and copayments for the state subsidized commonwealth care plans. premiums will vary from $18 per month, for individuals with incomes 100–150% of the poverty line, to $106 per month for individuals with incomes 250–300% of poverty. the connector approved two copayment schemes for plans for people 200–300% of poverty. one plan will have higher premiums and lower copayments, while a second choice will have lower premiums and higher copayments. four managed care plans began offering commonwealth care on november 1, 2006. coverage for people above 100% of poverty up to 300% of poverty began on february 1, 2007. as of december 1, 2007, around 158,000 people had been enrolled in commonwealth care plans. initial bids received by the connector showed a likely cost for the minimum insurance plan of about $380 per month. the connector rejected those bids, and asked insurers to propose less expensive plans. new bids were announced on march 3, 2007. the governor announced that "the average uninsured massachusetts resident will be able to purchase health insurance for $175 per month." but plan costs will vary greatly depending on the plan selected, age and geographic location, ranging from just over $100 per month for plans for young adults with high copayments and deductibles to nearly $900 per month for comprehensive plans for older adults with low deductibles and copayments. copayments, deductibles and out-of-pocket contributions may vary among plans. the proposed minimum creditable coverage plan would have a deductible no higher than $2,000 per individual, $4,000 per family, and would limit out-of-pocket expenses to a $5,000 maximum for an individual and $7,500 for a family. before the deductible applies, the proposed plan includes preventive office visits with higher copayments, but would not include emergency room visits if the person was not admitted. the new plan covered abortions (both elective and medically necessary) in the heavily catholic state. outcomes prior to aca the number of uninsured massachusetts residents dropped from about 6% in 2006 to about 2% in 2010, before increasing to between 3–4% in 2012. the united states census department shows a higher percentage of uninsured for the same years but a similar trend line. both trend lines mirror the approximately 400,000 residents added to the rolls of the insured in 2006/2007 via an expansion in medicaid eligibility rules and the subsidization of the commonwealth care insurance program. a 2011 view of the data, released by the state in 2013, shows the number of people receiving employer-sponsored insurance (esi) in massachusetts decreased by approximately 500,000 people (about 8% of the state population) since the enactment of the massachusetts health insurance law in 2006. the latest u.s. census data on health care insurance types in massachusetts was released in september 2012, and also illustrates the long-term decrease in esi, and an increase in public, free and subsidized insurance. in the early years of the implementation of the law, approximately 2% of those eligible were determined not to have had access to affordable insurance, and a small number opted for a religious exemption to the mandate. approximately 1% of taxpayers were determined by the commonwealth to have had access to affordable insurance during tax year 2009 and had to pay an income tax penalty instead. comparing the first half of 2007 to the first half of 2009, spending from the state's health safety net fund dropped 38–40% as more people became insured, before increasing in later years. the fund—which replaced the uncompensated care pool or free care—pays for medically necessary health care for those who do not have health insurance. according to the dhcfp in a report dated september 2011, "total health safety net (hsn) payments increased by 7% in the first six months of health safety net fiscal year 2011 (hsn11) compared to the same period in the prior year while demand increased by 10%. demand represents the amount that providers would have been paid in the absence of a funding shortfall. because hsn11 demand is expected to exceed hsn11 funding, hospital providers experienced a $38 million shortfall during the first six months of hsn11." versus the same period two years earlier, hsn spending plus demand has increased 20% the reduced state health safety net payments anticipated (but not realized) that by reducing the number of uninsured people, commonwealth care would reduce the amount of charity care provided by hospitals. in a subsequent story that same month, the boston globe reported that commonwealth care faced a short-term funding gap of $100 million and the need to obtain a new three-year funding commitment from the federal government of $1.5 billion. by june 2011, enrollment was projected to grow to 342,000 people at an annual expense of $1.35 billion. the original projections were for the program to ultimately cover approximately 215,000 people at a cost of $725 million. according to the dhcfp, 89,000 people bought healthcare insurance directly as of june 2009, up from 40,000 in june 2006. the number of people with group insurance in massachusetts held steady at around 4,400,000 since passage of the health care reform law, according to the dhcfp. one outcome has been the unavailability of coverage by many insurers previously doing business in massachusetts. a study published in the american journal of medicine, "medical bankruptcy