Tuesday, June 17, 2003
The new program, called "Dirigo Health," will contract with private insurers for coverage. If there are no firm bids on the contract then Dirigo will offer the insurance directly.
The insurance will be available to individuals, businesses which employ fewer than 50 people and workers with larger companies that do not provide insurance. Individuals will pay based on their income with Dirigo subsidizing the lower income people. The subsidies would decrease the more a person earns. The cutoff for no subsidy is when a family of four earns $55,000.
Small businesses could offer the insurance but be required to pay 60 percent of the premiums for full-time workers and a pro-rated amount for part-time workers who work at least 20 hours per week.
The goal is to have all uninsured people able to get the insurance within five years. Reaching this goal will be a major benefit to unmarried adults in Maine since recent studies show that unmarried people are twice as likely to be without health insurance as married people. It will have a major impact on single parent families since studies show that children raised in a single parent home are much more likely to lack health coverage than children in a married couple family.
A related story published on June 14 in the Press Herald reported that final enactment in the Senate on Friday drew applause from supporters, who said the health-insurance program - coupled with an expansion of Medicaid - will cover the estimated 180,000 Mainers who go without insurance each year.
"It's a great day for people who can't afford the high cost of health-care coverage because help is on the way," said Joe Ditre, executive director of Consumers for Affordable Health Care.
Democratic Sen. Sharon Treat, the bill's chief sponsor in the Senate, said the program aims for the same goal of universal health care as a single-payer health-care system, a controversial measure being studied by a legislative panel. But, she said, Dirigo Health is not "disruptive to the current system we have."
The program is funded by contributions from employers and employees who can afford to pay, federal money and an annual fee on insurance carriers to recover the tens of millions of dollars of bad debt and charity care normally incurred by the uninsured and ultimately shifted onto the premiums paid by insured individuals. The governor has pledged about $53 million in federal funds for the first year of the program, which would start on July 1, 2004.
"One of the key features is that it's a combination of public- and private-sector resources and market forces," said Sen. Michael Brennan, D-Portland, co-chair of the bipartisan Joint Select Committee on Health Care Reform, which unanimously endorsed the bill.
Other groups had mixed feelings about the bill's enactment, saying they hope the plan will work but have their doubts.
Among the bill's provisions is that insurers, doctors and hospitals adhere to voluntary 3 percent caps on revenue increases. There are also tighter restrictions on medical expansions that doctors and hospitals can undertake.
Hospitals, which also face a voluntary 3.5 percent cap on price increases, might have to consider cutting back health-prevention programs and reducing salaries, according to the Maine Hospital Association.
"We don't know how much fat there is out there, but we'll soon find out," said association president Steve Michaud, who says he plans to meet with members this summer to assess the plan's impact.
Many Republicans questioned whether the law will be able to contain costs, but voted for it because of amendments made in work sessions.
To help win a unanimous "ought to pass" report from the health-care reform committee, the Baldacci administration agreed to a provision that would let the Legislature consider a high-risk pool model if Dirigo Health performed unfavorably. That insurance model, found in 31 other states, separates the sickest individuals to bring down premium costs for other premium payers.
Dirigo Health would have to show after three years whether it is helping to reduce the number of uninsured Mainers and whether it is reining in insurance costs.
"We do have a 'Plan B,' and that gave us a lot of comfort," said Rep. Kevin Glynn, R-South Portland, who sat on the health-care reform panel.
The governor was ready to begin making appointments this summer to the Dirigo Health board and an advisory committee on quality, but that will now happen after September. The start date was pushed back when Republicans voted against a version of the bill that contained an emergency provision.
The votes were close. Rep. Joe Bruno, R-Raymond, House Minority leader, said the bill could have been passed with the "emergency preamble" if another vote were taken.
Aides say Baldacci will hold a bill-signing ceremony next week, when members of his health care team - Trish Riley, director of the Office of Health Policy and Finance and the chief author of the bill, and deputy director Ellen Schneiter - will be available.